Europe is rocketless. How did that happen?
In 2014, Europe and its space industry stood at a crossroads. Things were going well at the time; the continent had around 50% of the global launch market in its pocket. But dark clouds were on the horizon – clouds in the shape of SpaceX’s Falcon 9 rocket and an industry-wide shift towards commercialization and cheaper launches. It seems that nobody checked the forecast; almost a decade later, Europe’s launch capabilities have virtually fizzled out. With its workhorse rocket Ariane 5 now retired, any potential successor is either chronically delayed or just taking its baby steps.
This puts Europe in the tricky and somewhat embarrassing position of being incapable of independently reaching orbit and beyond – a realm which is becoming increasingly important to Earthly aspirations, political and commercial. But the reasons for its current predicament run deeper than the delay of a rocket or two, leaving the continent with limited options of how to dig itself out of its hole.
Modern European space ambitions can be interpreted through the continent’s desire for strategic autonomy, a goal that is slipping further from its grasp every day. The Russia-Ukraine war is making it quite clear that the US calls the shots in defensive matters, also highlighting Europe’s dependence on foreign energy. The space landscape took a similar hit: in cooperation with Europe’s main launch contractor Arianespace, Russia’s cheap, reliable Soyuz rockets frequently shuttled European crew and payload into orbit from Europe’s spaceport in French Guiana before cooperation was severed following Russia’s 2022 invasion. Now, with Europe’s remaining small-lift rocket Vega-C grounded due to a mishap, Ariane 5 retired, and Ariane 6 yet to make a flight, Europe is stuck in launch limbo, depending on US vehicles to reach orbit – not very strategically autonomous.
So why can’t they pull it together? Part of it is due to Europe’s decentralized nature and the befuddling bureaucratic structure of its space entities. Obviously, this is far more confusing than that of single countries like the US; in the latter case, the budget is dictated by the central government, and the industry adjusts accordingly. In Europe, many countries have their own space agencies while also contributing to the European Space Agency (ESA). ESA also receives funding from the EU, although that is an independent entity.
The EU, in turn, has its own complex web of space bureaucracy, resulting in a decentralized and scattered system. As noted here, space decisions are not taken by one or few individuals (‘unfortunately, we do not have an Elon Musk in Europe,’ said one technical officer working for ArianeGroup), but rather make their way through the maze of bureaucracy. This is democratically sound – and perhaps even necessary for a coalition of this breadth – but a plague for space projects, the immediate benefits of which might not be so readily apparent.
The pattern of fragmentation continues within ESA. As mentioned here, the agency operates under a so-called georeturn policy; in principle, the money invested into ESA by a member state should be returned to it in the form of contracts of the same value. But while this helps the industries of individual states, especially smaller ones, it results in programs being spread wafer-thin, becoming decentralized and expensive. To contrast, SpaceX and its bargain launches employ a system of vertical integration, manufacturing most (if not all) of its components and systems in-house.
Then there’s the financial side, which, compared to the US, has two significant difficulties. For one, ESA and the EU Space Programme’s budgets pale in comparison to those of NASA and the Space Force. This means less flashy projects and commercial investments, leading to the second point: Europe’s venture capital funds are smaller and its financial climate is not primed for the expensive, risky business of space. That didn’t stop a plethora of small launch startups from popping up, but as argued here, a lack of government contracts and private investments could cause many to collapse.
And that’s not the whole story. As pointed out by Andrew Parsonson of European Spaceflight, especially France and Germany, who harbor many of these startups, are already heavily invested in one dominating launch company: Arianespace.
Arianespace became the first commercial launch company when it was formed in 1979. It was created by ESA and CNES, the French space agency, to oversee proceedings of the Ariane rocket series. The latter went on to become the workhorse of the industry for decades, the introductions of its newer variants neatly overlapping with the twilight launches of the old to avoid gaps in the launch sequence. Other rockets, including Vega and (partially) Soyuz, were also added to the company’s roster. By the time 2014 rolled around, the company commanded 50% of the global launch market and it was becoming time to think about Ariane 6, the successor to 5. There was a new buzz in the air: the young American company SpaceX offered launches at competitive prices with the ultimate aim of reusability, and was beginning to nibble away at Arianespace’s market share.
The veteran company wasn’t worried. ‘SpaceX primarily seems to be selling a dream… which is good, we should all dream,’ said managing director of Arianespace’s Asean offices Richard Bowles in 2013; ‘…personally, I think reusability is a dream.’ He had some reason to think so. There was no predicting just how meteoric SpaceX’s rise would be, and the jaw-droppingly cheap prices it was advertising at the time have still not come about. As a result – plus the fact that greenlighting a risky design like SpaceX’s would have been politically tricky – ESA and Arianespace made the decision to go forward with a nonreusable Ariane 6 in 2014.
But it seems they were more concerned about costs than they first let on. Around the same time, aerospace companies Airbus and Safran proposed to buy up the 35% shares still held in the company by CNES, upping their joint shares to 74%, and suggested radical overhauls to the vehicle’s design in order to lower costs and remain competitive. They would later join forces to create Airbus Safran Launchers, which eventually rebranded to ArianeGroup.
The plan, it seems, backfired. Ariane 6, which is Arianespace’s first project under ArianeGroup, has done nothing but rack up a development bill of $4.4 billion – as of roughly three years ago. Most of this dough comes courtesy of ESA, and ArianeGroup reportedly has a habit of asking for extra subsidies to cushion the financial risks involved with developing rockets. According to SpaceX director of commercial sales Stephanie Bednarek, citing information provided at an ESA Space Day in 2017, almost 19% of ESA’s €5.75 billion 2017 budget – roughly €1 billion – went towards funding Arianespace’s various projects, including Ariane 6 and Vega.
This is in part due to Ariane 6’s constant state of delay. A recent update from October 2022, which pushed the maiden launch to 2023 at the earliest, slapped another €600 million onto the development costs (the launch is now scheduled for 2024). And it was one delay too many; the Ariane 5 retirement was planned to coincide with an operational Ariane 6, and there’s now that gaping hole in the industry calendar. Excuses for the delay include the pandemic, late shipments of parts, and last-minute design changes implemented for competitiveness. The latter involved an Auxiliary Power Unit (APU) that would allow the upper stage engine of the vehicle to be restarted multiple times, making it more versatile – but this semi-commitment to efficiency may have cost Europe independent access to space.
While exact prices remain unclear, launches will reportedly cost €75-115 million a pop, depending on the configuration of the rocket. It’s not exactly competitive, with SpaceX charging around $67 million. Regardless of its issues, though, Ariane 6 is already in business. ESA had previously guaranteed the company five flights a year, with the company having to make up the rest in commercial contracts, of which it has claimed to have 29.
One is reminded of NASA’s SLS rocket, whose contractors inherited their cost-plus deals from the Shuttle program in order to keep the jobs going, making the project exorbitantly expensive. And yet, jobs don’t seem to be what’s at stake here; in 2018, the company announced it would be laying off 2,300 employees, likely to reduce the costs of the cash-guzzling rocket, and generally does not boast nearly as big a workforce as NASA’s longstanding contractors. It has more to do with the georeturn strategy, as noted here, with the manufacturing of the rocket scattered across Europe to help smaller countries and companies get in on the action. ArianeGroup claims to be working with over 550 Europe-wide contractors for the Ariane 5, which is unlikely to change significantly with the new vehicle.
So, to summarize: a rocket nine years in development, no more complex than the Falcon 9, not reusable, and costing billions in investment, has still not flown – and yet, it doesn’t come as a surprise. As explained in this study, the clunky development process is simply the latest in a tradition of Europe’s state-sponsored space business, which worked for the vehicles of the past but does not suit the high-risk, high-reward nature of the modern industry. Ariane 6’s delays are but a symptom of these underlying issues. Still, the rocket series had been serving Europe fine for decades – why change things for the worse?
The pickle Europe finds itself in today is due to it half-assing the process of development by selling out Arianespace and uprooting industry processes to bring down launch costs for the sake of competitiveness – while simultaneously refusing to keep with the times. The result is the current situation, which is neither here nor there. Had ArianeGroup gone all-in with reusability, they might have had a competitive edge. That $4.4+ billion development investment far surpasses the roughly $1 billion invested into the Falcon 9’s technology. Had they kept things how they were, the rocket might have been a little pricier to launch – but at least they’d have a rocket.
And that, it turns out, is the most important thing. As the past few years have shown, a European rocket will always find a customer on the continent. For Europe, it’s hard to put a price on one of the only instances of strategic autonomy within reach, which is why the situation is so painful.
When asked how Ariane 6 would keep up with the market, this sentiment was echoed by ArianeGroup civil program manager Franck Huiban; ‘Ariane 6 is being developed first of all to address the launch needs of European institutional customers… each space power needs to keep a sustainable, independent and reliable access to space,’ he said. Commercial projects, he added, come ‘on top’. But this access has now been forsaken to satisfy a market that isn’t even the primary concern. The rocket, with lofty goals of competing against SpaceX while being developed within a system not designed for the likes of it, might have been doomed from the start.
Meanwhile, SpaceX has long cracked reusability and now dominates the industry. The effect is certainly felt in Europe; French economy minister Bruno Le Mair recently admitted that ‘in 2014 there was a fork in the road, and we didn’t take the right path… we should have made the choice of the reusable launcher. We should have had this audacity.’ To its credit, ESA seems to be picking up on the benefits of fostering other commercial opportunities, realizing that to a considerable extent, companies like SpaceX have NASA and other US government contracts to thank for their current prominence. ESA introduced its Boost! initiative for commercial launchers in 2019 and is handing out occasional funding to startups, but with the agency’s smaller budget (and much of it going to ArianeGroup), there’s a long way to go.
As to what Europe’s options are, the pickings are slim. Though the Soyuz is an attractive possibility – being cheap, efficient, and previously operated by Arianespace – a collaboration might not be so appealing to both the EU and Russia. China’s space program is making impressive strides, and ESA has one satellite project in the works in collaboration with that country. However, ESA recently cancelled a trip to China’s space station due to alleged funding issues – but it is also likely that the US, whom Europe dearly needs on its side, might not have taken too kindly to the mission, either. Collaboration with India, an up-and-comer in the space industry, is more likely. Though its companies are still young, ESA has already booked its solar mission Proba-3 a flight aboard an ISRO Polar Satellite Launch Vehicle (PSLV). Having joined the Artemis Accords – the US’s nonbinding set of policies for space exploration – India seems to be in the US’s good books, and its launches are cheap. Then there’s the US itself, and collaboration is already extensive; the Falcon 9 has stepped up to launch ESA’s Euclid telescope, for example, and ESA contributes to the SLS’s Orion capsule.
ESA’s own upcoming launches seem to hang mainly on its Vega-C rocket, which is currently grounded (but at least exists). A few small launch companies such as the UK’s Skyrora and Germany’s Isar are also ramping up their efforts. Also, a recent study showed that private European investments in space tech had beaten out the US in the first quarter of 2023 despite their historic pattern of lagging behind. ESA also has plans for a reusable rocket of its own, known as Themis – but with ArianeGroup as the primary contractor, a much-delayed first launch finally scheduled for 2024, and no halfway operational rocket in sight, it might not be worth holding your breath anytime soon.
So it appears that in order to claim its autonomy and not fall behind, Europe must commit – either by centralizing around Arianespace and ensuring its success, or decentralizing by fostering commercial competition. Right now, it’s doing neither.