Tag Archives: Airbus-Safran

Europe and Airbus Safran ink deal to build Ariane 6

The competition heats up: The European Space Agency and the joint partnership of Airbus and Safran have signed their deal for the development of Europe’s next rocket, Ariane 6, that will replace Ariane 5 and is aimed at competing more effectively against SpaceX in the world’s launch market.

Want to see an Ariane 5 launch in French Guiana? You can!

Arianespace and Airbus Safran are holding a contest where the winning prize is an all-expenses paid trip to French Guiana to see an Ariane 5 launch in 2017.

This is part of Airbus Safran’s public relations effort to promote their new rocket, Ariane 6, that will replace Ariane 5.

Arianespace sets payload weight record

The competition heats up: Arianespace’s Ariane 5 rocket successfully launched its heaviest payload ever yesterday by placing two Intelsat communications satellite in orbit.

This was also the first launch by Arianespace since the ESA company was taken over by the private joint partnership of Airbus Safran.

European commission approves Airbus-Safran buy of Arianespace

The competition heats up: The bureaucrats in the European Union have given their approval to the purchase by Airbus-Safran Launchers of Arianespace, thereby clearing the way for the privatization of that ESA entity and the construction, under Airbus-Safran control, of Ariane 6.

Following an in-depth review, the European Commission has approved under the EU Merger Regulation, the acquisition of Arianespace by Airbus Safran Launchers (ASL), a joint venture between Airbus and Safran. This approval is subject to conditions. Commissioner Margrethe Vestager, in charge of competition policy, said: “A well-functioning satellite and launcher industry is important to guarantee that European companies and institutions can gain access to space at competitive terms. The commitments offered by ASL ensure that after its takeover of Arianespace, all players in the industry will continue to have incentives to innovate.”

The Commission had concerns that the transaction would give rise to flows of sensitive information between Airbus and Arianespace to the detriment of competing satellite manufacturers and launch service providers. The Commission’s approval is conditional on the implementation of the commitments offered by the companies to address these concerns.

I must say that, in reading this story, I understood far better why the United Kingdom voted to leave the European Union. Though this particular deal is certainly different and involves many important government issues, if every private business deal is subject to the numbing concerns of this commission, I myself would run screaming from them as fast as I could.

Airbus Safran merger completed

The competition heats up: The expected merger of Airbus and Safran to create a rocket company called Airbus Safran Launchers is expected to be finalized today, allowing the new company to move forward in its construction of Ariane 6, designed to compete with SpaceX’s lower cost rockets.

Airbus Safran begin Ariane 6 engine tests

The competition heats up: In its effort to build Ariane 6 by 2020, Airbus Safran has begun testing of that rocket’s upper stage Vinci engine.

This test phase, set to last until September, will include running the engine repeatedly as well as for as long as 1,000 seconds. Once they have determined the engine’s design, behavior, and overall thrust, they will be able to design and build the upper stage.

Ariane 6 delayed by tax and legal issues

In the heat of competition: Even as Airbus Safran claimed today that Ariane 6 will be price competitive with SpaceX’s Falcon 9, the company cannot begin work on the new rocket because of a turf war Arianespace and French tax collectors.

The tax issue is as follows:

Airbus and Safran had agreed that Safran would pay Airbus 800 million euros ($874 million) in cash, in addition to its rocket-engine manufacturing capability, to become a 50-50 ASL shareholder with Airbus. Airbus officials since the beginning of the year have been negotiating with French tax authorities to determine how to minimize the tax bite of the cash transfer, which industry officials could be as high as 500 million euros, leaving Airbus with a net of just 300 million euros.

Delays in the cash transfer have meant that ASL, which is expected to count 8,000 employees, has been operating with only around 400 employees. In addition, it has made it difficult for the initial ASL team to present a fixed-price Ariane 6 production proposal to the 22-nation European Space Agency, which is financing the majority of Ariane 6 development.

In addition, the merger is being reviewed by the European Commission, part of the European Union.

The commission is looking at whether Arianespace’s minority shareholders, who are Ariane 6 contractors, will be protected once Airbus Safran Launchers raises its Arianespace shareholding to 74 percent from today’s 39 percent. The commission is also reviewing concerns expressed by satellite builders that Airbus, which is a major manufacturer of commercial satellites, might give its own satellites preferential treatment in setting the Ariane 6 manufest.

Airbus Safran still insists they can get the new rocket launched by 2020, but somehow that doesn’t seem reasonable to me, especially because I expect the French and European government authorities here to carve out their piece of the action, thus making it harder for the private company to deliver on time.

Europe settles on Ariane 6 design

The competition heats up? Airbus Safran and the European Space Agency have settled on the design of their next generation rocket, Ariane 6.

It will not be re-usable, and though they say it will be 40-50% cheaper to produce than Ariane 5, it is very clear from the quotes in the article that they are instead depending on trade restrictions to maintain their European customers, even if it costs them a lot more to put satellites in orbit.

For its part, Airbus Safran does not envisage making Ariane 6 recoverable, not in the short term. Mr Charmeau [the company’s CEO] believes that different market conditions apply in Europe and the US, which means there will not be a single, winner-takes-all approach. He cites, for example, the restricted procurement that exists in all major political blocs, which essentially bars foreign rockets from launching home institutional and government satellites. Nowhere is this more true than in the US, but in Europe too there is an “unwritten rule” that European states should use European rockets.

From an American perspective this lazy attitude is fine with me. Let American companies compete aggressively. They will then leave the Europeans and everyone else in the dust.

France sells Arianespace to Airbus Safran

The competition heats up: In negotiations resulting from increased competition in the launch industry, France and its space agency have agreed to sell their stock in Arianespace to Airbus Safran, builders of the new Ariane 6, giving that private company 74% ownership.

I have reported on this deal earlier. This report makes it clear, however, that Arianespace will essentially become irrelevant after the deal is completed. Airbus Safran will build and own the rocket, and will be in charge.

ESA and Airbus Safran agree on deal to build Ariane 6

The competition heats up: Airbus Safran have come to an agreement with the European Space Agency on building Ariane 6, Europe’s next commercial rocket.

The key part of the deal is that ESA and Arianespace will be ceding ownership of the rocket to Airbus Safran.

The French government is likely to approve the sale of CNES’s 34-percent stake in the Evry, France-based Arianespace launch service provider to Airbus Safran Launchers at about the same time as the Ariane 6 development contract is signed.

With that sale, Airbus Safran will control Arianespace, which means they will also own the rocket they are building for Arianespace. This is fundamentally different than the situation with Ariane 5, which Airbus built for an Arianespace owned and run by the many-headed ESA. The result was a bloated government-run operation that never made a profit.

Now Airbus will own it instead. They have already indicated that they will trim the costs at Arianespace. More importantly, with ownership will come the freedom to compete effectively in the much more competitive launch market created by the arrival of SpaceX. No need to get permission from ESA to do things.

Arianespace admits it is in a head-to-head competition with SpaceX

In testimony at a hearing in the French parliament the head of Arianespace admitted that the company has been in a head-to-head competition with SpaceX for the past two years, with SpaceX grabbing half the business.

He also claimed that they think they will be able to compete with SpaceX, even if it succeeds in recovering and reusing its first stage.

Israel said Arianespace fully expects SpaceX to succeed in its attempt to recover its Falcon 9 first stage.

But that’s just the start of the challenge, he said. It remains unknown what the refurbishment costs will be compared to the cost of churning out a fresh stage from an existing production line. He said it is also unclear whether commercial fleet operators will immediately accept placing $200 million telecommunications satellites on a rocket with a refurbished stage.

Finally, he said, flying a reusable stage means sacrificing first-stage performance so that enough energy is available to power it back to its recovery point. That power is thus unavailable for the mission, which is one reason why Hawthorne, California-based SpaceX thus far has attempted to recover its stages only on low-orbit missions, not for missions to geostationary transfer orbit, where most commercial satellites operate.

All true, but if Arianespace sits on its hands because of these facts it will eventually lose. It needs to rise to the challenge that SpaceX poses, not poo-poo the challenge.

Airbus Safran demands full ownership of Ariane 6

The competition heats up: One of the heads of Airbus Safran that is offering to build Europe’s next rocket, Ariane 6, has said that they must have full control of the rocket and project or they won’t do it.

“We are now a few weeks from the submission of a bid, and of course at this stage everyone defends his camp,” Lahoud said. “It is said that industry needs to make a financial contribution. We have said it’s possible we will contribute, but on condition that [development] not be conducted under the former system.

“We want responsibility for the design, the production, the commercialization and operations to be in the hands of industry, and not in a sort of mixed-economy creation that borrows more from the United Nations than from what our competitors do. Under these circumstances, and only under these circumstances, will there be a business case that allows us to invest, and to defend before our boards of directors the fact that corporate cash needs to be spent.”

In other words, they will not build something that will be under the complex bureaucratic control of the many-headed European Space Agency. Under that framework, they don’t think they can compete, so why bother?

ESA and Airbus Safran in budget dispute over Ariane 6

The competition heats up: The deal between ESA and Airbus Safran to build Europe’s next generation rocket, Ariane 6, to compete with SpaceX for the launch market is now threatened because Europe wants the company to pay more for development than the company expected.

[ESA launch director Gaele] Winters acknowledged that Airbus Safran Launchers has not agreed with ESA’s assessment that industry’s share of the development cost is around 400 million euros. “They told us they have not signed off on the 400 million [euros], and this is correct,” Winters said. “It is an assumption we made, which we will look at next during the full Program Implementation review scheduled for mid-2016. Industry is prepared to invest in the program, and one important condition is that we need to be sure they have a fair rate of return on their investment.”

Winters said ESA is sensitive to the fact that additional costs borne by industry will find their way into the Ariane 6 pricing structure, which would undermine the vehicle’s competitiveness on the international commercial market.

If Airbus Safran wants to own the rocket, they must be willing to pay for some of its development, as have SpaceX and the other new American commercial space companies. This is the price for having the right to make money from the rocket outside of its European government customers. It seems, however, that Airbus Safran is balking at that reality. They are used to having everything covered by ESA, and are now unhappy they might have to lay out some bucks themselves.

Airbus-Safran demand total control of Arianespace

The heat of competition: The European joint-venture between Airbus and Safran is now demanding that be given total control of Arianespace and the development of the new Ariane 6 rocket.

From Airbus’ perspective, the production of rockets in Europe should be done the same way commercial Airbus aircraft are built. “The launcher business in Europe in the beginning of 2014 was one in which the vehicles were designed by government agencies, commercialized by a company called Arianespace, produced by an ensemble of companies, and then launched by Arianespace. This is not an optimal situation,” [Airbus strategy director Marwan] Lahoud said.

“The optimal solution is to industrialize the process, with one prime contractor that designs, builds, sells and operates the launchers, with a supply chain — much as we do with Airbus today.”

Essentially, this would be a shift in ownership of the rocket, moving from the government to the private company. We have seen the same process in the U.S., with the new commercial space products no longer controlled or designed by NASA. The result has been lower cost, faster development, and greater profits.