ESA’s ruling council ends without launcher agreement, stalemate with Europe’s Ariane 6 contractors continues
An Ariane 6 upper-stage hydrogen tank is delivered from MT Aerospace to prime contractor ArianeGroup’s Bremen, Germany, facility. Credit: ArianeGroup
PARIS — The European Space Agency’s ruling council on March 21 ended with no resolution of the standoff with Europe’s launch industry that has kept sparkling-new Ariane 6 production facilities off-line.
No one calls it a strike, but it has the earmarks of one. ESA governments say they need Ariane 6 in full service by late 2020 or early 2021, some six months after the vehicle’s planned mid-2020 inaugural flight.
A batch order of 14 Ariane 6 vehicles to cover launches between 2021 and 2023, the transition period from the heavy-lift Ariane 5, is long overdue.
Much more delay in starting production of the 14-rocket series will mean the vehicles will not be ready by early 2021, delaying the planned ramp-up in Ariane 6 flights and potentially missing opportunities to launch European government payloads.
Industry’s position is that it cannot commit capital to a bulk rocket order without customer commitments, and European governments have been unable to commit to more than a few launches.
The two sides have been camped on their positions over a year and have not moved. In the interim, nothing has happened in the commercial-launch market to give industry any hope for a sudden influx of Ariane 6 orders in 2021.
Of course, each mission added to the manifest helps. The OneWeb constellation of low-orbiting broadband satellites recently contracted with Arianespace to launch 30 10-kilogram OneWeb satellites on the inaugural Ariane 62 flight in 2020. The contract included two Ariane 6 options.
OneWeb recently contracted to launch 30 satellites on the inaugural Ariane 6 flight in mid-2020, with two options included in the contract. Credit: ArianeGroup
Already some in Europe are talking about scenarios in which OneWeb’s order of 20 more Russian Soyuz rockets launched from Russian spaceports might be divided with Ariane 6. OneWeb’s launch campaigns are scheduled to start in earnest at the end of 2019.
In fact, given the time lag between satellite construction contracts and launches, 2021 looks like it will be a very bad year for anyone operating large rockets and looking for commercial business — Arianespace, SpaceX, Blue Origin — anyone.
Meeting in Marseille, France, the ESA council had the immediate urgency of the Ariane 5-Ariane 6 transition at the top of its agenda. But while there were signs of a consensus on a solution, none was concluded.
Instead, the council asked ESA Director-General Jan Woerner and his team to meet with industry in the next three weeks in an attempt to find a way forward, and to report back to a special ESA council meeting set for April 17.
Government and industry officials said privately that the solution will include having ESA governments accept that they will pay more to launch their payloads, at least through 2023, than they had originally thought.
In return, industry must accept a simulacrum of a legally binding commitment to launch seven payloads on Ariane 6 between 2021 and 2023.
ESA Launcher Director Daniel Neuenschwander declined to specify what a deal might look like. He said the meeting was not an easy one, but that all ESA governments were united on at least one point:
“Industry has to provide the launchers to be available for our institutional missions, and without delay,” Neuenschwander said.
“We have missions to launch. Ariane 6 has to be ready. If industry is on time, they will get this business. If they are not ready, they miss a huge opportunity and they will have more difficulty in putting this launcher on the market. I hope this much is clear,” Neuenschwander said.
Without resorting to double- or triple-shifts, which would add cost, ArianeGroup estimates it will take about 18 months to produce Ariane 6 vehicles from the time of the order. Currently the 14-rocket batch order for the Ariane 6 transition period was for launches starting in early 2021. That date is still feasible — but only just.
The number of combined missions planned for ESA, European national governments, the European Commission and Eumetsat between 2021 and 2023 is exceptionally high for Europe, where government launches have traditionally been no more than 25-30% of the business for the Arianespace commercial launch company.
But even a high-water market in European government launch demand cannot fully offset the decline in the market for large geostationary-orbit satellites, which for for 40 years have been Arianespace’s main business.
Sensing what was coming, Arianespace and is owner, Ariane 5 and Ariane 6 prime contractor ArianeGroup, in 2018 agreed to reduce their last batch order of Ariane 5 rockets from the contracted 10, to eight.
“It’s a way to phase out, a bit earlier, the costlier asset and favor the Ariane 6 ramp-up,” said one Ariane contractor. Ariane 6 is designed to cost at least 40% less to build and launch than Ariane 5.
That last Ariane 5 batch was supposed to be launched starting in 2020. Whether it might be put into service later than that given the slowdown in orders is unclear.
Every year of dual operations of Ariane 5 and Ariane 6 is a year of high cost, which is why ESA and industry had agreed to a cost-sharing plan to get through it. But that plan now needs to be reviewed given the state of the commercial market.
ESA governments are determined to steer clear of paying annual subsidies — they call them offsets to certain launch industry fixed costs — as they begin the Ariane 6 era.
Neuenschwander said that remains the goal. “It’s better to use it than to subsidize it,” he said. “We don’t want to subsidize the system. The best thing is to come to a rapid ramp-up of Ariane 6 and then transition to the regular exploitation phase.”