Airbus exploring ways to expand scale in space and satellite sectors
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Airbus Seeks Expansion in Defence and Space Markets
Airbus is actively exploring avenues to expand its presence in defence, space, and particularly in the satellites market, according to CEO Guillaume Faury. Ahead of the upcoming Farnborough Airshow, it has been revealed that Airbus, in alliance with France’s Thales, is considering a potential merger of certain space activities, a response to burgeoning competition within the sector.
Preliminary discussions focused on the companies' overlapping satellite operations have begun, sources suggest. These talks, initially reported by La Tribune, highlight the companies' joint interest in scaling up within the space environment in Europe. Faury stated, "We are looking at opportunities to create scale, and that's true in defence, that's true in space, and in particular on satellites. We would be happy to find ways to create scale in the space environment in Europe in general."
Airbus and Thales Alenia Space, with Italy’s Leonardo holding a 33% stake in the latter, stand as Europe’s leading manufacturers of satellites utilized in telecommunications, navigation, and surveillance. However, their market for geostationary satellites is experiencing increasing pressure. This pressure stems from competition posed by large constellations of expendable satellites in low Earth orbit, such as the Starlink network developed by Elon Musk's SpaceX.
In response to the struggles in its space services business, Airbus recently recorded a substantial financial charge of 900 million euros ($980 million) last month, following a 500 million euro charge the previous year. Faury informed analysts that the company is "evaluating all strategic options" for its space division. These options encompass restructuring, cooperation, portfolio reviews, and potential merger and acquisition scenarios.
As the landscape of space competition evolves, Airbus's strategic maneuvers will be closely watched. The discussions with Thales could potentially lead to significant shifts within the European space industry, as traditional manufacturers seek ways to remain competitive in the face of innovative new players.
