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Why is Europe not at the forefront of the spacetech race?

Last month, there were reports that the European Space Agency (ESA) joined forces with SpaceX to send four Galileo satellites into orbit in 2024. They opted for Elon Musk’s US company because Europe’s Ariane 6 rockets faced delays, leaving the continent without a reliable way to launch big stuff into space.

Even though it’s meant to fill a hole in their current capabilities, it’s a letdown for Europe’s spacetech community. Sadly, a lot of them saw this disappointment coming.

Why is Europe unable to match other spacetech nations?

Right now, Europe is falling behind in spacetech compared to the rest of the world. The deal with SpaceX is a clear symbol of the frustrating situation holding back opportunities to boost its capabilities. Why did Europe have to resort to a US company? Well, there’s plenty of demand, and it’s not like the region lacks the top-notch engineering talent required to build its own rockets.

The big issue is the lack of competition driving the development of new capabilities. It’s safe to assume that governments aren’t doing much to improve the situation. European spacetech companies are dealing with a massive funding gap compared to the US and China. In the US, NASA and the Department of Defense poured in over $62 billion in 2022, providing substantial financial support.

China’s got a similar deal, with the government chipping in a total of $12 billion. Now, look at the European Space Agency (ESA), with its annual budget of just 7.5 billion euros, and it’s no wonder the region is falling behind. It’s obvious that relying on foreign imports and companies like SpaceX is going to make Europe’s sovereignty vulnerable in the long run. So, what’s the story behind Europe falling so far behind?

Also Read: Is living on Mars really possible or just a far-fetched dream?

Is “geographic return” becoming a problem for Europe?

Part of the problem with ESA is the “geographic return” regulations. Essentially, when a country funds ESA, an equal amount of money has to be pumped back into its own domestic industry.

The idea behind “geographic return” was to promote investment and distribute the load (and benefits) among both large and small nations. However, lately, it’s been criticized for holding back the competitiveness of the European space sector. In a nutshell, innovation and competition aren’t evenly distributed. Funding should go to the best products, ideas, and the most scalable commercial innovations, regardless of where they come from.

At the start of this year, Josef Aschbacher, the Director General of ESA, suggested that the region should shift to a “fair contribution principle.” This involves tweaking the contribution of each European member state based on the results of industrial competitions and the actual share its industry gains in these competitions.

It’s definitely a move in the right direction, but I’d argue that it doesn’t go far enough. Doing away with “geographic return” altogether would be the game-changer Europe needs to stay competitive in the global space tech race.

Europe is lagging behind globally, and one reason for that is the lack of public-private partnerships to fuel growth in the continent’s space sector.

What is the US different from Europe?

Look at the US, for instance, where NASA’s Commercial Orbital Transportation Services (COTS) program supported SpaceX in creating Falcon 9, the first (and most cost-effective) partially reusable rocket. The triumph of Falcon 9 laid the foundation for an ongoing era of public-private partnerships that keep the US space scene competitive today.

Bill Nelson, the head honcho at NASA, has also voiced support for fixed-price contracts with companies involved in space exploration. With fixed-price contracts, it’s the companies handling the technical systems that bear any unforeseen costs, not NASA. This setup makes the market more competitive, especially for growth-stage companies offering budget-friendly services to the agency.

In Europe, they lack the kind of environment that encourages public-private partnerships. One reason is the absence of a shared defense initiative. Plus, they don’t have someone like Elon Musk or Jeff Bezos ready to throw billions into the mix. According to NASA’s independently verified figures, SpaceX spent around $390 million in total developing both the Falcon 1 and Falcon 9 rockets.

Also Read: ESA’s big plan to eliminate new space debris within a decade

What Europe needs to do urgently

Unlike the US, there isn’t a single European country large enough to go solo in this venture. This is where the magic of collaboration between public-private partnerships and similar-minded companies could really change the game. After all, they’ve witnessed this process thrive with pan-European success stories like Airbus and defense systems specialist MBDA.

The world of spacetech holds the power to drive innovation in every facet of our lives. In Europe, there are plenty of companies working on technologies that won’t just push our outer space goals but will also enhance life right here on good ol’ Earth. But for them to succeed, they need the support and backing to thrive.

If things keep going the way they are, Europe might just end up watching from the sidelines while space industries in countries like the USA and China race ahead. If they don’t do something about it, this situation won’t just hinder their ability to launch satellites; it could put their economy, security, and even defense capabilities at risk.

Vishal Kawadkar
About author

With over 8 years of experience in tech journalism, Vishal is someone with an innate passion for exploring and delivering fresh takes. Embracing curiosity and innovation, he strives to provide an informed and unique outlook on the ever-evolving world of technology.