Oct 07 2015

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GEO SATCOM industry takes a hit

A Poor Harvest For Satellite Manufacturers, An NSR Examination. Outstanding analysis by Northern Sky Research.

Basically, GEO SATCOM contracts are down 39% this year compared to the 5 year average. NSR points to three reasons why this has occurred:

  1. The rising importance of Export Credit Agencies (ECA). The death of the EX/IM bank has not only hurt US GEO SATCOM manufacturers, but other countries’ ECA likely don’t have enough heft to pick up the slack. This results in a rise in risk for capital investment, which makes it more difficult to agree on contracts.
  2. Launch failures of Falcon 9 and Antares. This is 2/3 of the usual launch vehicles for this market. Manifests have slipped over a year in most GEO SATCOM cases, stretching out current programs and decreasing the need for new contracts.
  3. Stiffer competition overall. Not just from other GEO SATCOM systems, but LEO broadband solutions that are on the horizon.

In today’s space industry, heightened risk is not a question—the question is which risk to take. At the outset this involves more careful planning and market considerations with slower, determined action that results in less near term orders.

Couldn’t have said it better myself.

Their conclusion:

More contracts are expected before the end of the year, including Azerspace-2 and a Telstar 18 replacement, but reaching an anticipated harvest of 23 orders is all but out of reach. NSR already expected lower order levels (17-20 satellites) for 2016-2018, and while 2016 might receive some respite as delayed 2015 orders are realized, the manufacturing market is unlikely to return to the bumper crops of a few years back (30 satellites in 2009).

The whole article is about a page long, and well worth the five to ten minutes of reading. Bravo Zulu, Northern Sky Research!!

Permanent link to this article: http://www.newspaceraces.com/2015/10/07/geo-satcom-industry-takes-a-hit/

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