🔗 Share this article

A trio of prominent EU-based aerospace companies—the Airbus Group, Leonardo, and Thales Group—have now sealed a strategic deal to combine their space-related operations. The collaboration aims to form a single pan-European tech company capable of rivaling with the SpaceX.

Financial Aspects and Ownership Breakdown

This resulting company is expected to generate annual revenue of approximately 6.5 billion euros (£5.6bn). As per the arrangement, the French aerospace giant Airbus will control a 35% share in the new business. Meanwhile, both Italy's Leonardo and France's Thales will each own 32.5% ownership.

Scope and Goals of the New Company

The unnamed merger represents one of the largest partnerships of its type across Europe. It will unite diverse capabilities in satellite manufacturing, space systems, components, and support services from top defense and aerospace manufacturers.

Guillaume Faury, Roberto Cingolani, and Patrice Caine jointly declared, “The joint company represents a pivotal milestone for Europe's space industry.” They continued, “Through pooling our talent, resources, expertise, and research and development strengths, we intend to generate growth, accelerate progress, and provide greater benefits to our clients and stakeholders.”

Operational Details and Timeline

This new company will be based in Toulouse and have a workforce of approximately 25,000 employees. The entity is planned to become fully functional in 2027, pending necessary approvals. According to the partners, it is projected to generate “hundreds of” millions of euros in cost savings on annual profit each year, starting following a five-year timeframe.

Context and Motivation

Reports indicate that discussions between Airbus, Leonardo, and Thales began last year. The initiative aims to replicate the model of the European missile manufacturer MBDA, which is jointly held by Airbus, Leonardo, and BAE Systems.

Although substantial job cuts in their space units in recent years, the companies assured that there would be no immediate site closures or job losses. Nonetheless, they noted that unions would be consulted throughout the project.

Past Struggles in Space-Related Business

The firms have faced setbacks in their space operations in recent times. The previous year, Airbus recorded €1.3bn in losses from unprofitable space contracts and revealed 2,000 job cuts in its defense and space sector. Similarly, the Thales Alenia Space joint venture, a collaboration of Thales and Leonardo, eliminated over one thousand jobs last year.

Worldwide Competitive Landscape

At the same time, Elon Musk's SpaceX company, founded in 2002, has grown to become one of the biggest startups worldwide, with a valuation of {$400 billion dollars. It leads both the rocket launch and satellite-based internet sectors. Its primary rivals include other US firms such as United Launch Alliance, a joint venture of Boeing and Lockheed Martin, and Blue Origin, created by technology tycoon Jeff Bezos.

Earlier recently, the company successfully flew its 11th Starship rocket from Texas, USA, landing in the Indian Ocean. In August, American President Donald Trump approved an presidential directive to streamline space launches, easing regulations for private space operators.