2010s: Competition and pricing pressure Space launch market competition

awarded global commercial launch market share

after approximately 2010, new private options obtaining spaceflight services emerged, bringing substantial price pressure existing market.

in december 2013, spacex flew first launch geosynchronous orbit providing additional credibility low prices had been published since @ least 2009. low launch prices offered spacex (less $2,500 per pound orbit falcon 9 v1.1 , $1,000 falcon heavy in contracts 2015), communication satellites flying geostationary (gto) orbit, resulted in market pressure on competitors lower own prices.

in years prior 2013, communications satellite launch market had been dominated europe s arianespace, flies ariane 5, , international launch services (ils), markets russia s proton vehicle. in november 2013 arianespace announced new pricing flexibility lighter satellites carries orbits aboard ariane 5 in response spacex s growing presence in worldwide launch market, , followed in 2014 request european governments additional subsidies face competition spacex.

by late 2013, published price of us$56.5 million per launch low earth orbit, falcon 9 rockets [were] cheapest in industry. reusable falcon 9s drop price order of magnitude, sparking more space-based enterprise, in turn drop cost of access space still further through economies of scale. falcon 9 gto missions 2014 pricing approximately us$15 million less launch on chinese long march 3b. despite spacex prices being lower long march prices, chinese government , great wall industry company—which markets long march commsat missions—made policy decision maintain commsat launch prices @ approximately us$70 million.

continuing face stiff competition on price, 7 european satellite operator companies—including 4 largest in world annual revenue—requested in april 2014 esa find immediate ways reduce ariane 5 rocket launch costs and, in longer term, make next-generation ariane 6 vehicle more attractive smaller telecommunications satellites. ... [c]onsiderable efforts restore competitiveness in price of existing european launcher need undertaken if europe [to] maintain market situation. in short term, more favorable pricing policy small satellites being targeted spacex seems indispensable keeping ariane launch manifest strong , well-populated. in competitive bids during 2013 , 2014, spacex winning many launch customers formerly have been all-but-certain clients of europe s arianespace launch consortium, prices $60 million or less.

in june 2014, arianespace ceo stephane israel announced european efforts remain competitive in response spacex recent success have begun in earnest, including creation of new joint venture company arianespace s 2 largest shareholders: launch-vehicle producer airbus , engine-producer safran. no specific details become more competitive released @ time. in 2015, european multinational space agency—the european space agency (esa)—is endeavoring reorganize in order reduce bureaucracy , decrease inefficiencies in launcher , satellite spending have been historically tied amount of tax funds each country has provided esa.

in august 2014, eutelsat, third-largest fixed satellite services operator worldwide revenue, indicated plans spend approximately €100 million less each year in next 3 years, due lower prices launch services , transitioning commsats electric propulsion. indicated using lower prices can spacex against arianespace in negotiation launch contracts. november 2014, spacex had begun take market share arianespace. eutelsat ceo michel de rosen said, in reference esa s program develop ariane 6, each year passes see spacex advance, gain market share , further reduce costs through economies of scale. european government research ministers approved development of new european rocket—ariane 6—in december 2014, projecting rocket cheaper construct , operate , more modern methods of production , streamlined assembly try reduce unit costs plus rocket s modular design can tailored wide range of satellite , mission types [so it] should gain further economies frequent use. in 2016, arianespace projecting launch price of €90–100 million, one-half of 2015 ariane 5 per launch price.

facing direct market competition spacex, large launch provider united launch alliance (ula) announced strategic changes in 2014 restructure launch business—reducing 2 launch vehicles one—while implementing iterative , incremental development program build partially-reusable , lower-cost launch system on next decade. in october 2014, ula announced major restructuring of processes , workforce in order decrease launch costs half. 1 of reasons given restructuring , new cost reduction goals competition spacex. ula has had less success landing contracts launch private, commercial communications , earth observation satellites has had launch military payloads, ceo tory bruno believes new lower-cost launcher can competitive , succeed in commercial satellite sector. gao has calculated average cost of each ula rocket launch government has risen approximately us$420 million. in may 2015, ula stated go out of business unless won commercial , civil satellite launch orders offset expected slump in u.s. military , spy launches.

as of 2015, spacex had remained low-cost supplier in industry. however, in market launch of military payloads, ula faced no competition launches decade, since formation of ula joint venture lockheed martin , boeing in 2006. spacex upsetting traditional military space launch arrangement in us, has been called monopoly space analyst marco caceres , criticized in congress. of may 2015, spacex falcon 9 v1.1 certified usaf compete launch many of expensive satellites considered essential national security.

university of southampton researcher clemens rumpf argues global launch industry developed in old world space funding provided governments, resulting in stable foundation [global] space activities. money space industry [had been] secure , did not encourage risk-taking in development of new space technologies. ... space landscape [had not changed since mid-1980s]. result, emergence of spacex surprise other launch providers because need evolve launcher technology giant leap not apparent them. spacex shows technology has advanced sufficiently in last 30 years enable new, game changing approaches space access. washington post has said changes occasioned multiple competing service providers has resulted in revolution in innovation.

by mid-2015, arianespace speaking publicly job reductions part of attempt remain competitive in european industry [which being] restructured, consolidated, rationalised , streamlined respond spacex price competition. still, arianespace remained confident maintain 50 per cent share of space launch market despite spacex s slashing prices building reliable rockets smaller , cheaper.

following first successful landing , recovery of spacex falcon 9 first stage in december 2015, equity analysts @ investment bank jefferies estimated launch costs satellite operators using falcon 9 launch vehicles may decline 40 percent of spacex typical us$61 million per launch, although spacex has forecast approximately 30 percent launch price reduction use of reused first stage.

in march 2017, spacex reflew orbital booster stage had been launched, landed , recovered, stating cost company of doing substantially less half cost of new first stage. coo gwynne shotwell said cost savings came though spacex did extensive work examine , refurbish stage. did way more on 1 [is planned future recovered stages].

a 2017 industry-wide view spacenews reported: 5 july 2017, spacex had launched 10 payloads during bit on 6 months— outperform[ing] cadence earlier years —and on track hit target set last year of 18 launches in single year.

by comparison, france-based arianespace, spacex’s chief competitor commercial telecommunications satellite launches, launching 11 12 times year using fleet of 3 rockets — heavy-lift ariane 5, medium-lift soyuz , light-lift vega. ... russia has ability launch dozen or more times proton doing both government , commercial missions, has operated @ slower cadence past few years due launch failures , year’s discovery of incorrect material used in rocket engines. united launch alliance, spacex’s chief competitor defense missions, regularly conducts around dozen or more launches per year, boeing-lockheed martin joint venture has performed 4 missions in 2017 far.