Tag Archives: Stephen Israel

Arianespace lowers its prices.

The competition heats up: In an effort to compete with SpaceX, Arianespace has lowered the price it charges for launching smaller satellites on its Ariane 5 rocket.

According to Stephen Israel, the company’s CEO, the lower prices have already produced some contracts. However, the company has not been able to institute comparable cost savings in its operations, which means it

…will force the European launch supplier to ask European governments this year for a 16 percent increase in annual support payments. In its 2013 annual report, Evry, France-based Arianespace said it will ask European Space Agency governments in December to allocate 116 million euros ($158 million) per year for the period between 2015 and 2018 to enable Arianespace to reach financial break-even. That figure compares to the current allocation of about 100 million euros per year for 2013 and 2014 that ESA governments approved in late 2012.

I wonder if the company will get these additional subsidies. In the past there were complaints from the European partners about the inability of Arianespace to make a profit. For it to lose even more money now will not make people happy.

I think, however, that Israel recognizes this. He has been pushing the organization to streamline its operation. Whether he can succeed against Arianespace’s entrenched pork-laden structure remains the big question.

In a speech in Singapore, the head of Arianespace said that the company urgently needs to overhaul its Ariane 5 rocket in order to meet tough competition from SpaceX and Russia’s Proton rocket.

Recognizing the competition: In a speech in Singapore, the head of Arianespace said that the company urgently needs to overhaul its Ariane 5 rocket in order to meet tough competition from SpaceX and Russia’s Proton rocket.

“We have a newcomer in America with SpaceX. Yes, competition is increasing, but when competition is increasing, we need to be more and more agile,” said Israel. While recognising that Arianespace was the market leader, “we have to ask ourselves one question: what should we do to remain the leader? Europe is very serious about launchers, and Europe will not give up when it comes to launchers.”

For Arianespace this speech is a very good thing, as it demonstrates again that Israel — and the company — are aware of the competitive challenge put forth by SpaceX and are not making believe it doesn’t exist.