The European Space Agency is aiming for its own version of SpaceX

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The European Space Agency kicked off its bid to create a European version of SpaceX by selecting two companies on Wednesday to develop commercial cargo services to the International Space Station.

The Exploration Company, a Franco-German startup founded just three years ago, and Thales Alenia Space, a Franco-Italian space systems provider, beat several other applicants to win seed funding of €25 million each to build a commercially viable service to low cost – Earth orbit by 2028. A second round of funding, expected to be in the hundreds of thousands of euros, will be decided at the next ESA ministerial meeting in 2025.

The move marks ESA’s first concrete step in emulating a strategy pioneered by the US space agency NASA nearly 20 years ago, in which it will buy flight services from commercial companies rather than outsource the development of rockets and spacecraft.

NASA’s strategy of awarding development funds followed by fixed-price service contracts was critical to the success of Elon Musk’s SpaceX, today one of the world’s most reliable providers of launch, cargo and crew services to the ISS .

“The signing of the Low Earth Orbit Cargo Return Services contracts shows how ESA has modernized to meet the demands of the next era of the space economy,” said Josef Aschbacher, ESA Director General, who since his appointment has been pushing for more – a commercial approach to public procurement to support the development of the European space sector and reduce costs.

ESA hopes the vehicles could even be adapted for human spaceflight or lunar missions.

“We want to have evolutionary capabilities that will either allow crewed transport to low Earth orbit or bring cargo back from the Moon Portal [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 provided by ESA are much smaller 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 providing resupply services to the ISS, and within two years agreed to $3.4 billion in fixed-price contracts.

ESA only has €75 million for this first phase. The 25 million euros that were not allocated in Wednesday’s announcement were to be awarded to a third bidder, believed to be MaiaSpace, a subsidiary of French-owned ArianeGroup.

However, its initial proposal was rejected and it will either revise its design or the balance will go to the two existing winners for additional proposals to improve the capabilities of their vehicles, 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 its founding in 2021, said the contract was a “milestone” for its Nyx vehicle. ESA became a major customer, which was important for the NASA certification, he said.

Thales Alenia Space said the cargo program comes “at a time when the space exploration landscape is evolving rapidly, with a mix of institutional and commercial players embarking on missions to explore low-Earth orbit, the Moon and Mars.” It aimed to “raise the bar in terms of innovation and efficiency, while strengthening the company’s role as a major player in the coming space economy.”

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