{"id":35096,"date":"2021-07-12T08:17:00","date_gmt":"2021-07-12T08:17:00","guid":{"rendered":"https:\/\/one.sightlinemg.com\/c4isrnet\/uncategorized\/2021\/07\/12\/the-german-new-space-industry-is-booming-so-why-isnt-berlin-buying-in\/"},"modified":"2026-08-08T00:13:12","modified_gmt":"2026-08-08T00:13:12","slug":"the-german-new-space-industry-is-booming-so-why-isnt-berlin-buying-in","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/c4isrnet\/space\/2021\/07\/12\/the-german-new-space-industry-is-booming-so-why-isnt-berlin-buying-in\/","title":{"rendered":"The German \u2018new space\u2019 industry is booming. So why isn\u2019t Berlin buying in?"},"content":{"rendered":"\n

PASING, Germany \u2014 On a balmy June afternoon, members of the defense and space industries, regional lawmakers, and other observers gathered just outside of Munich, Germany, to witness the opening of new space company Mynaric\u2019s first serial production facility.<\/p>\n\n\n\n

The company, which launched in 2009 as a spinoff from the German Aerospace Center, will build laser communication equipment at scale out of its 1,600-square-meter facility. Per the company, Mynaric\u2019s announced contracts for hardware delivery are currently all for U.S.-based customers, including the Defense Advanced Research Projects Agency and the Space Development Agency. A few memoranda of understanding have been signed with customers in Europe and the rest of the world, a spokesperson said.<\/p>\n\n\n\n

That situation is illustrative of many \u201cnew space\u201d companies based in Germany. NATO allies like the United States and France are dedicating evermore resources to military space assets; notably, both Washington and Paris have separated some of their space-related bureaucracies away from their airborne military branches, with the new U.S. Space Force and the French Space Command, respectively.<\/p>\n\n\n\n

See the 2021 Top 100 list here!<\/b><\/a><\/p>\n\n\n\n

Germany, on the other hand, has articulated the importance of space<\/a>, but has yet to put many actual euros behind the statement, observers say. That comes in part from Berlin\u2019s longstanding investments in the automotive and machining sector \u2014 where much of the government\u2019s research and development funds go \u2014 and an ongoing reluctance to dedicate more resources to the country\u2019s military budget.<\/p>\n\n\n\n

But German-based companies like Mynaric and microsatellite launcher Isar Aerospace are betting that, in the long run, Germany and other European governments will understand the value of their products \u2014 not just for the commercial market but also for government and defense uses.<\/p>\n\n\n\n

\u201cGoogle is easy to use. Using satellites isn\u2019t quite as easy, yet,\u201d Mynaric CEO Bulent Altan said at the opening event of the production facility.<\/p>\n\n\n\n

Mynaric is counting on that bet: Officials announced plans to produce 2,000 units per year by using a diversified supply of commercial off-the-shelf components as well as specific proprietary, built-to-print components selected for their scalability and redundancy.<\/p>\n\n\n\n

The company is currently providing its optical cross-link terminals for DARPA\u2019s Blackjack program, which seeks to prove the viability of a proliferated small satellite constellation in low Earth orbit. Mynaric also worked with other cross-link providers as well as the Space Development Agency to develop an interoperability standard to ensure laser cross-links on the U.S. military\u2019s small satellites can communicate effectively with commercial constellations in development by Amazon, SpaceX, OneWeb<\/a>, Telesat and more.<\/p>\n\n\n\n

The \u201cnew space\u201d sector arrived with a bang in the last half decade, thanks to rapid developments in launch capability, reduced launch costs and the business case for small-satellite technology showing promise. While there is currently an appetite for these companies to work on both American and European commercial programs aimed at creating major space-based constellations, the vast majority of government-funded programs still reside in the United States.<\/p>\n\n\n\n

Some European government leaders want to get more involved. Space has been a traditional driver for many large nations\u2019 militaries, but the \u201cnew space\u201d technology sector may be more appropriate for Germany since it applies to smaller use cases, said Thomas Sattelberger, a member of the German Bundestag from the state of Bavaria and a member of the nation\u2019s Free Democratic Party.<\/p>\n\n\n\n

Speaking on a panel at Mynaric\u2019s facility opening ceremony, Sattelberger noted that Germany could find a viable business model in being \u201chidden deep-tech champions.\u201d<\/p>\n\n\n\n

Defense projects are fighting for research dollars against the long-established automotive industry, Sattelberger said. \u201cThe country has long rested on the laurels of building cars and machinery,\u201d but if those funds were put toward space technology efforts, that could push those efforts through the often fatal \u201cinvestment valley of death<\/a>.\u201d<\/p>\n\n\n\n

\"\"
A worker is pictured inside Mynaric’s new serial production facility at the Oberpfaffenhofen special research airport outside Munich. The company is one of a raft of “new space” start-ups looking to connect with government markets in Germany and Europe. (Mynaric photo)<\/figcaption><\/figure>\n\n\n\n

Many companies could benefit from such a shift in resources. A 2020 report commissioned by the aerospace trade support group Bundesverband der Deutschen Industrie, or BDI, showed that 92 related companies were founded in Germany over the past 20 years. More than one-third of those companies launched in the last five years.<\/p>\n\n\n\n

Many of these companies are using venture capital to build themselves up. Mynaric was formerly VC-backed before going public in 2017.<\/p>\n\n\n\n

Isar Aerospace, which emerged in 2018 out of a student research group at the Technical University of Munich, has raised more than $100 million in venture capital, said CEO Daniel Metzler.<\/p>\n\n\n\n

However, it has been difficult for Isar to receive European or German government funding, he said.<\/p>\n\n\n\n

\u201cWhen we have applied for European grants, for example, we\u2019ve just always been told that it\u2019s too easy for us to get venture capital,\u201d meaning government funding would be deemed needless, he explained.<\/p>\n\n\n\n

Much of German government funding goes toward the automotive industry because it is \u201cby far the biggest job-creating industry,\u201d Metzler noted. Another challenge is that many government officials don\u2019t fully understand the space industry, he added. Meanwhile, \u201cin the U.S., we were seeing billions and billions [of dollars] flowing into U.S. companies developing launchers, developing satellite constellations.\u201d<\/p>\n\n\n\n

Germany risks losing these new space companies to neighbors like Luxembourg and Switzerland if the government doesn\u2019t start investing itself in \u201canchor contracts\u201d or additional research grants, Sattelberger said. An anchor contract involves a government agreeing to procure certain quantities of a commercial product or system that meets mission requirements, allowing the commercial venture to remain viable and keep the product cost effective.<\/p>\n\n\n\n

Traditionally, even when Germany has allocated space contracts, they have all gone to the major prime contractors like Airbus, Thales and OHB.<\/p>\n\n\n\n

\u201cGermany and Europe in general need a system change in space based on the American model. Instead of developing and implementing space projects on their own, governments should purchase services and award more contracts to especially innovative \u2018new space\u2019 companies,\u201d said Matthias Wachter, BDI\u2019s head of international cooperation, security policy, raw materials and space. \u201cThe best way to strengthen the dynamic \u2018new space\u2019 ecosystem is through more government anchor contracts.\u201d<\/p>\n\n\n\n

So far, it\u2019s been particularly difficult for these new space companies to break into the German defense sector. German Navy Rear Adm. Christian Bock, director of NATO\u2019s Center of Excellence for Operations in Confined and Shallow Waters, acknowledged during the panel that the government has been slow to accept military space applications, which made it difficult to develop the optimistic spirit needed to advance the sector.<\/p>\n\n\n\n

\u201cAs the military, we\u2019re not exactly sexy,\u201d he noted.<\/p>\n\n\n\n

Space is \u201csomehow pretty far away for the German military,\u201d Wachter added. \u201cThat\u2019s a big mistake because without space, future wars are definitely lost.\u201d<\/p>\n\n\n\n

While Isar Aerospace doesn\u2019t have any military-related contracts, Metzler sees defense becoming \u201cmore and more important,\u201d as platforms such as the Franco-German-Spanish Future Combat Air System will rely significantly on in-space connectivity, and agencies like NATO are placing a greater emphasis on space capabilities.<\/p>\n\n\n\n

\u201cGoing forward, I definitely see the defense industry as a very, very big driver,\u201d Metzler said.<\/p>\n","protected":false},"excerpt":{"rendered":"

The government has articulated the importance of space, but has yet to put many actual euros behind the statement, according to analysts.<\/p>\n","protected":false},"author":7,"featured_media":115475,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_yoast_wpseo_meta-robots-noindex":"","_yoast_wpseo_meta-robots-nofollow":"","_yoast_wpseo_canonical":"","_acf":"","_yoast_wpseo_primary_category":37,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","_smg_distribution_targets":[]},"categories":[7,106,29,13,32,37],"tags":[],"coauthors":[3329],"class_list":["post-35096","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-battlefield-tech","category-daily-brief","category-home","category-industry","category-newsletters","category-space"],"acf":{"subheadline":"","legacy_arc_id":"3EYAYBE6QJCLRDFGOZM77FYUKI","arc_canonical_url":"\/top-100\/2021\/07\/12\/the-german-new-space-industry-is-booming-so-why-isnt-berlin-buying-in\/","remove_feature_photo":false,"is_sponsored":false,"subtype":"","redirect_url":"","disable_inline_ads":false,"native_logo_pretext":"Presented By:"},"yoast_head":"\nThe German \u2018new space\u2019 industry is booming. 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