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Abu Dhabi, UAESaturday 23 February 2019

Arianespace cuts rocket price as commercial space battle heats up

European rocket maker aiming to cut cost of launching the Ariane 6 by around 40 per cent versus the Ariane 5

An Ariane 5 rocket takes off in Kourou, French Guiana. Arianespace is taking on rivals such as SpaceX. EPA
An Ariane 5 rocket takes off in Kourou, French Guiana. Arianespace is taking on rivals such as SpaceX. EPA

Europe's Arianespace is discounting the price of satellite launches with its Ariane 5 rockets as it competes against US rival SpaceX for customers before the release of the cheaper Ariane 6 rocket next year, a senior executive said on Wednesday.

Arianespace is aiming for the cost of launching the Ariane 6 to fall by around 40 per cent versus the Ariane 5 through design changes and higher volume production, bringing its prices more in line with Elon Musk's SpaceX, sai Arianespace managing director and head of sales for Asia-Pacific Vivian Quenet.

He said in current marketing campaigns, the company is offering customers such as telecoms an Ariane 5 launch for the same price as the Ariane 6.

"We have made a lot of effort on the sales price. When we do that, the result is very positive," Mr Quenet said on Wednesday, declining to discuss details of profitability.

Arianespace is competing for two major launch contracts in the Asia-Pacific region that should be awarded this year and expects there could be tenders for another three, he said.

Arianespace, majority-owned by a joint venture of Airbus and Safran, completed 11 launches with its Ariane 5, Vega and Soyuz rockets in 2018, in line with guidance that had been lowered mid-year from an initial 14.

The company, which has a mission of guaranteeing Europe independent access to space and is used by government and commercial clients, this month forecast up to 12 launches in 2019, with four of them targeted in the first quarter.

The Satellite Industry Association lobby group estimates the satellite launch services market is worth $5.5 billion a year. SpaceX has upended the industry with reusable rocket technology that has slashed the cost of space transportation.

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Another US group, the United Launch Alliance joint venture between Boeing and Lockheed Martin, said last week it would conduct the final design review for its new flagship Vulcan rocket within months as it also looks to lower costs to better compete against SpaceX.

Amazon.com Ifounder Jeff Bezos' Blue Origin said this month it will fly its still-in-development New Glenn rocket in 2021 - the same year as Vulcan.

SpaceX, which media reports say is valued at $30.5bn, said this month it would fire about 10 per cent of its more than 6,000 employees, seeking to create a leaner company to deal with the "extraordinarily difficult" challenges of developing interplanetary spacecraft and a global space-based internet.

SpaceX may make a manned mission to space in June.

This month, The National reported that Saudi Arabia has become the latest member of the space club. It is the seventh nation in the Arab world to open an agency and the third in the Arabian Gulf, following the UAE and Bahrain.

The formation of the Saudi Space Agency was part of a broader Government reshuffle by King Salman. The reorganisation installed Prince Sultan bin Salman at the agency’s helm. In terms of experience, there is no one better qualified for the job. The prince was the first Arab to travel to space in June 1985, aboard the Space Shuttle Discovery and responsible for the successful deployment of ArabSat-1B.

Arianespace's majority shareholder, ArianeGroup, announced on Tuesday it had signed a contract with the European Space Agency to study a mission to the moon before 2025 with the aim of mining regolith, an ore from which it is possible to extract water and oxygen.

Quenet said if the mission proceeded, it would be launched with the Ariane 6 at its facilities in French Guiana.

Updated: January 23, 2019 04:46 PM

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