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Space


Space Green Paper

1.1.3. The industrial and technological base

Europe's space sector should, in order to be competitive and credible, must have available an industrial structure of high quality, and access to key technologies.

Industry

The strong industrial base existing in Europe that is competitive at world level, and capable of mastering the entire chain, must be maintained and/or reinforced if Europe is to exercise its freedom of initiative in the space sector.

Today, the European space sector directly employs 30000 highly qualified people, spread over about 2000 companies which cover the full range of skills relating to systems, subsystems and components.

As for its characteristic features, space industry is at the same time:

  • Strategic: it ensures Europe's independence in essential sectors of the space field;
  • Dual: it covers both civil and defence markets;
  • A "catalyst": its effects go beyond the space sector as such, in particular with regard to the electronic consumer equipment and television broadcasting industries.

Increasing competition has over the years led European space industry to carry out major restructuring. It is now organised at European level and is in competition with or a credible partner of its American counterpart.

However, it is affected crisis in growth in telecommunications and the sharp fall in demand for this type of satellite.

A competitive industry

  • The overall turnover of the European space industry is €5.5 billion a year.
  • In recent years, half of the total turnover of the European space industry has come from institutional orders and the other half from the commercial market (cf. Figure 2). This contrasts with the situation in the United States where three quarters of turnover come from NASA and Defence Department orders.
  • In public expenditure, the ratio between civil and defence expenditure is 1:5 in Europe whereas in the US they are of equal magnitude. Accordingly, European industry does not benefit from the same synergies as its American counterpart.·
  • Investment in the space applications sector in general generates a services market (e.g. TV broadcasting) larger by a factor 10 (cf. Figure 3).

Fig. 2: Consolidated turnover of European space industry(in million €) [Source : Commission]
Fig. 2: Consolidated turnover of European space industry(in million €)
[Source : Commission]

Fig. 3 : Estimation of the cumulative value chain for the global commercial market (satellite navigation and communication by satellite – 1998-2007)(in billion €) [Source: Arianespace, ESA]

Fig. 3 : Estimation of the cumulative value chain for the global commercial market (satellite navigation and communication by satellite – 1998-2007)(in billion €) [Source: Arianespace, ESA]

Europe must determine if it wants to maintain an industrial base covering the whole chain of space activities and applications. In the industrial sector, it should also identify the sectors of maximum added value, where the best comparative advantage may be developed.

Technology

In order to remain competitive, European industry needs a broad and efficient technological base maintained through research and demonstration programmes.

This requires, in particular, that close co-operation be maintained between the space industry, service providers and public research bodies and also calls for early identification of technological requirements in the coming decades.

In the space sector, the technological chains are costly and market volumes limited; this makes it imperative for the public authorities to intervene.

In this context, the European Union, the ESA, the national players and industry have established various instruments to intervene in the whole value chain.

Support to Technology: a range of actions

  • The space technology plan drawn up by the ESA provides the framework in which all public and private players in the European space sector are invited to identify European requirements and participate in joint actions. The ESA itself conducts a number of research and technological demonstration programmes.·
  • The 6th Framework Programme for Research of the Union focuses its efforts in the space sector on applications connected with teledetection, navigation and communication.
  • National R& programmes and self-financed initiatives of industry complete the European space technology landscape.
  • This does not exclude a possible need for programmes, or additional co-ordination mechanisms.

Q2.: In which fields – including those concerned with space systems used for security and defence – does Europe have critical technology and industrial short-comings, and how to redress the balance?

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