[Edaily Marketin Reporter YunJi Kim ] Large-scale funding is pouring into Europe’s private space industry. This trend stems from the growing need to secure independent space transportation capabilities, driven by a widening gap in Europe’s launch capacity following Russia’s invasion of Ukraine, coupled with rapidly increasing demand for satellites. In particular, as this coincides with efforts to reduce dependence on U.S.-based SpaceX, private rocket companies across Europe are emerging as new investment opportunities.

According to local investment banking (IB) industry sources on the 4th, Spanish space startup PLD Space has secured an additional 108 million euros (approximately 170.4 billion won) in Series C funding from Japan’s Mitsubishi Electric, COFIDES—an investment firm partly funded by the Spanish government—and U.S. venture capital firm Endeavor Catalyst. Combined with the funds secured last March, this brings the total raised in this round alone to 288 million euros (approximately 454 billion won).

PLD Space is a Spanish private space company founded in 2011. It made a name for itself in 2023 by launching “Miura 1,” a small rocket it developed in-house. The company is currently developing “Miura 5,” a commercial rocket designed to place satellites into orbit, and plans to allocate the funds from this investment toward the development of Miura 5, the expansion of production capacity, and the construction of launch facilities.

The reason investors are taking notice of PLD Space is Europe’s chronic shortage of launch vehicles. Europe has long maintained its independent space launch capabilities through its flagship rockets, but the use of existing rockets has become difficult following Russia’s invasion of Ukraine, and the Ariane 5, its former flagship rocket, was retired in 2023. The development and commercialization of its successor, the Ariane 6, have also been delayed compared to initial plans, significantly curtailing Europe’s independent launch capabilities for some time.

This launch vehicle gap has led to a reliance on the U.S.-based company SpaceX. The situation has reached the point where even some satellites built by Europe must be launched aboard SpaceX’s Falcon 9. In effect, a structure has emerged in which Europe possesses the capability to design and produce satellites but relies on a U.S. company to actually place them into orbit.

Amid a shortage of launch vehicles, demand for satellites is actually growing rapidly. In Europe, the use of satellites is expanding not only in telecommunications and meteorological observation but also in security sectors such as reconnaissance and military communications following the war in Ukraine. Consequently, the European Union (EU) is accelerating the development of its own satellite communications network to reduce its dependence on non-European operators, including those in the United States.

Consequently, the ability to launch rockets reliably and frequently has emerged as a new challenge for the European space industry. The European Space Agency (ESA) anticipates that demand for satellite launches will peak around 2030 and is considering plans to increase the launch frequency of the Ariane 6 and Vega C. While ArianeSpace plans to launch the Ariane 6 up to 10 times a year starting in 2027, it has determined that existing launch vehicles alone will be insufficient to meet the growing demand.

Private rocket companies have emerged as an alternative to fill this launch capacity gap. As governments and the ESA nurture private companies into new launch service providers, competition in the European launch vehicle market is intensifying. It is against this backdrop that the ESA launched the “European Launcher Challenge,” a program with a budget of over 900 million euros. The plan is to move away from the traditional government-led approach to rocket development and instead support the commercialization of competitive private companies to expand launch options.

The scale of support is substantial. ESA recently signed a 158.9 million euro contract with PLD Space and allocated 197.8 million euros to Germany’s Isar Aerospace. France’s Maia Space is also being mentioned as a candidate for follow-up support. With venture capital and strategic investor funds joining the mix, European private rocket companies are attracting both government support and private investment simultaneously. In essence, Europe’s policy-driven need to address the shortage of launch vehicles is giving rise to a private space industry market.