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The European Space Agency fired up its bid to create a European version of SpaceX, selecting two companies on Wednesday to develop commercial cargo services to the International Space Station.
The Exploration Company, a Franco-German start-up founded just three years ago, and Thales Alenia Space, a Franco-Italian supplier of space systems, beat out several other applicants to win seed funding of €25 million each to build a commercially credible low-end service – Earth’s orbit until 2028. The second round of funding, expected to amount to hundreds of thousands of euros, will be decided at the next ESA ministerial meeting in 2025.
The move marks the first concrete step by ESA in emulating the strategy introduced almost 20 years ago by the US space agency Nasa, under which it will purchase flight services from commercial companies instead of commissioning the development of rockets and spacecraft.
NASA’s strategy of allocating development funding followed by fixed-price service contracts has been key to the success of Elon Musk’s SpaceX, today one of the world’s most trusted providers of ISS launch, cargo and crew services.
“The signing of the Low Earth Orbit Return Services contract shows how ESA is modernizing itself to meet the demands of the next era of the space economy,” said Josef Aschbacher, ESA’s Director General, who since his appointment has pushed for a more commercial procurement approach to help nurture the European space sector and reduce costs.
ESA hopes the vehicles could even be adapted for human spaceflight or missions to the moon.
“We want to have evolutionary capabilities that will enable manned transport into low Earth orbit or return cargo from a lunar pass [the space station being developed by Nasa and partners which will orbit the Moon]” said Daniel Neuenschwander, ESA’s director of human and robotic research, in a recent interview with the Financial Times.
The strategy is based on NASA’s Commercial Orbital Transportation Services (COTS) program, launched in 2006. However, the amounts made available by ESA are far less than those that led to SpaceX’s success. Nasa initially awarded more than $400 million to two companies, including SpaceX, to develop a vehicle capable of resupplying the ISS, and within two years had awarded $3.4 billion in fixed-price contracts.
ESA only has EUR 75 million available for this first phase. The €25 million not awarded in Wednesday’s announcement was to be awarded to a third bidder, believed to be MaiaSpace, a subsidiary of French-owned ArianeGroup.
However, his initial proposal was rejected and he will either revise his design or the remainder will go to the two existing winners for additional proposals to improve their vehicles’ capabilities, a person familiar with the discussions said.
Even before ESA launched the cargo vehicle challenge last December, both TEC and Thales Alenia Space were working on their own cargo vehicle designs.
TEC, which has raised about $70 million in funding since it was founded in 2021, said the deal was a “major achievement” for its Nyx vehicle. ESA became a major client, which was important for certification by NASA, it said.
Thales Alenia Space said the cargo program came “at a time when the space exploration landscape is rapidly evolving, with a mix of institutional and commercial players embarking on low-orbit exploration missions around Earth, the Moon and Mars”. It aimed to “raise the bar in terms of innovation and efficiency, while at the same time strengthening the company’s role as a major player in the emerging space economy”.