The space and defence industry went from strength to strength in 2009. The sector proved to be crisis-resistant, as the number of projects increased globally by 55%, while in terms of the money spent on new projects, the outlook is even brighter as capital expenditure has nearly doubled, up 93% to $1.3bn.
All key countries included in greenfield investment monitor fDi Markets’ research experienced steady growth in the space and defence sector, with the US achieving 30% year-on-year growth in 2009. However, in the US the industry experienced a mixed first quarter of 2010, with president Barack Obama announcing in February that the NASA Constellation programme would be cancelled. However, this was followed in April by President Obama revealing a new plan involving a $6bn increase in NASA funding over the next five years.
Meanwhile, the UK enjoyed record growth in 2009, with project numbers nearly doubling to 23 – the greatest number of ventures recorded by fDi Markets in any country since it started monitoring the industry in 2003.
Despite the impressive figures, Aman Pannu, consulting analyst at Frost & Sullivan, strikes a cautionary note about the delayed impact of a recession, but adds that the UK emerged as an integral part of the space supply chain and its share of the sector will grow.
The Case for Space report, prepared by the South East England Development Agency (Seeda), is even more optimistic, stating that the industry is expected to grow three times faster than the country’s GDP. Its current contribution to the UK economy is estimated at £6.5bn ($9.43bn) a year and directly employs 19,100 people. Seeda expects that by 2020 these figures will jump to £14.2bn with indirect employment of 115,000 people.
UK shining bright
Surrey Satellite Technology (SSTL) illustrates the rapid growth of the sector in the UK. The company, with its headquarters in Guildford, specialises in small satellite missions. Due to the expansion of the industry in the UK, SSTL has achieved solid growth over the past 10 years. The outlook for 2010 is even brighter as the company, along with its German partner OHB System, starts work on building 14 satellites for the Galileo Navigation System.
The industry in the UK is also expected to benefit from the creation of the Space Agency, which was launched in March 2010. The agency, launched with the International Space Innovation Centre, will serve as the UK space hub. It will manage about £250m a year, and will participate in major European space initiatives such as the Global Monitoring for Environment and Security and the Galileo global-positioning system.
Rapid growth of the sector, especially in the UK, gives ground for the optimism. The delayed impact of the recession may hit the space and defence industry just when other sectors bounce back. But the Space Agency’s launch and additional capital gained through public-private partnerships give the impression that the UK space odyssey will be a successful one.
Growth in the space
and defence sector
Projects in the space
and defence sector