A UK space odyssey: UKspace talks opportunities and growth

The UK space industry aspires to be one of the most advanced and fast-growing space sectors in the world, spanning satellite manufacturing, launch services, applications, research and downstream data services. Employing nearly 50,000 people and contributing around £7bn in GVA, the sector plays a strategic role in the economy. The Manufacturer sat down with Dr Alice Bunn OBE, President, UKspace, to find out more.

Across the world, the space industry is entering something of an inflection point. It’s been just over 25 years since the launch of the International Space Station and plans are in place for its eventual deorbiting after 2030.

As Alice explained, the project involved huge scale, international governmental collaboration, the likes of which we may not see again for some time. “It’s been a really inspiring piece of engineering infrastructure with many different partners involved. It doesn’t feel like we’re going to get something on a similar scale anytime soon,” she said.

However, the fact that space is entering such a pivotal stage means that opportunities are still knocking for the sector’s manufacturers. The development of reusable rocket technology has seen launch costs in the sector steadily decline, which has in turn, opened up new commercial opportunities, particularly in manufacturing.

“The ISS has been fantastic for creating a research environment where we can look at novel materials and production techniques. However, we’re now moving beyond that to a point where the manufacture of some of these products is far more viable because those costs have come down so much. So, it is a really interesting time for the sector.”

Indeed, due to the decrease in costs, we’ve also seen changes around what can actually be taken into space and as such, a further trend has emerged around the increased challenges associated with the operating environment.

It’s increasingly a congested and contested arena, which is in turn creating plenty of opportunities in terms of continuing to manage and operate safely in space.

The UK – a view from space

Looking at the UK in isolation, Alice explained that a vibrant community now exists around in-orbit servicing and manufacturing to enable more life to be extracted out of satellites that are already in space. The traditional model was far more disposable and Alice likened it to buying a new car, driving it until it runs out of petrol and then abandoning it by the side of the road. “That doesn’t make a lot of sense,” she added. “So now, with this new capability around close proximity of operations, we can get to the point where we can refuel and get more life out of existing satellites.”

There are several companies in the UK emerging as experts in this arena as well as others displaying capabilities in debris removal capability. Alongside that, the UK is developing increasing capabilities in space domain awareness and continues to be strong in satellite applications such as Earth observation and large-scale communications.

Space is getting crowded

The sector is faced with something of a double-edged sword. The aforementioned reduction in launch costs is making it far easier and more feasible to get projects – literally – off the ground. However, by definition that almost promotes a single use, disposable culture, at a time when the sector should be thinking more closely about reuse and removal.

The nature of the sector meant that this throwaway ethos was ingrained from the beginning. You only have to turn the clock back a few decades to see that it was once just the superpowers of the US and the then Soviet Union that were players in the sector.

Now, over 100 countries are involved, as well as thousands of commercial operators and academia. Alice added: “We’ve got thousands of different entities launching stuff into space, so it’s definitely a more challenging environment. And it’s also one that we rely on far more than we used to.

“Our dependence on space has grown enormously. It was only in 2000 that the US opened up the GPS signal, instantly improving accuracy for civilians. Being without that feels unimaginable now, so our dependence on space has grown enormously.”

The UK’s space in space

While space underpins our civil and defence capabilities in terms of strategic advantages, Alice highlighted that the UK is utterly dependent on space capability. “The US were the first to realise its importance during the first Gulf War 35 years ago,” she added.

It seems the UK has been playing catch up ever since and while the traditional strengths around secure satellite communications remain, nowadays the modern battlefield relies on space capability for operations. “We don’t have that homegrown navigation capability, so we still work very closely with the US on that,” she added.

The UK’s strengths lie in Earth observation and understanding what’s happening in that space environment, whether that be threats from adversaries moving satellites, or operating them in a way that will hamper the ability of the UK and its allies to operate.

We’re now moving to a point where the manufacture of some space products is far more viable due to the reduction in launch costs. So, it is a really interesting time for the sector.

Space today fundamentally underpins our modern lives. If we took that away, we simply wouldn’t be able to live the way we do. And that is going to be increasingly important in the future, so we need to act now to protect our capability or lose out.
Dr Alice Bunn OBE, President, UKspace

This also applies to natural risks, such as space weather and understanding what’s happening inside the enormous geomagnetic storms that can come from the sun’s surface, and here again, the UK’s relationship with the US is key.

There is also enormous potential in the UK around in-space manufacturing in areas such as semiconductors and pharmaceuticals, and there is a question around whether the space stations of the future could be smaller, commercially run manufacturing operations rather than large government partnerships. “The UK certainly has a competitive edge where that’s concerned, but we do need to see it followed through,” Alice added.

Barriers to growth

Alice added that the investment landscape within the sector and the understanding of the capability required is currently creating some challenges.

“There is a role for government to play as a customer for space services, even though it can make them nervous,” she added. “That doesn’t mean that we expect government to pay for whole satellite systems, but it is appropriate that they procure satellite services and data.”

Therefore, if government would step up and take a small stake in the amount of space applications and services, it would enable the private sector to leverage investment opportunities far more effectively.

Perhaps unsurprisingly, the biggest product coming out of the space sector is data, and Alice added that it would be extremely beneficial if the government added more clarity around its procurement strategy in this regard.

While this is work in progress, any headway achieved so far has often been at local level and Alice warned that there could be instances where different government agencies or departments are paying twice for the same data.

Entry for SMEs

Despite the sector being characterised by a variety of SMEs, it can be a tough sector to break into, and this is where the government needs to step up and make sure that procurement frameworks are more user-friendly.

“We’re talking to a lot of people in the Cabinet Office in particular about how we can make the sector more accessible for the SME community,” added Alice. “What’s worrying is that we’re very good at creating businesses, but in the absence of a really strong, clear market in the UK, the risk is that those businesses will get bought up by companies overseas, typically in the US.”

It wasn’t all that long ago that the National Security and Investment (NSI) Act was introduced to protect national security by preventing the sale of some capabilities that were of key national interest.

However, Alice believes the UK is yet to see the benefits of this. “My experience of that act is that the threshold for reporting is very low but the threshold for acting, i.e. preventing any overseas acquisition, is actually really high. So, we’re doing a lot of reporting against it, but there’s very little intervention happening.

“We need to stop dithering and come off the fence about where our priorities are in order to maintain the confidence of the sector and keep it in the UK, otherwise people and businesses will look for lucrative offers overseas.”

Support for all

That being said, the space sector is far from the only manufacturing vertical looking for government backing and support. Steel has had an incredibly tough 12 months and other sectors such as automotive and food and drink have also been banging the drum for greater backing from Westminster. It would therefore appear that the government has some tough choices to make.

Alice added: “We have to make hard choices. And that’s difficult coming as President of a trade association, because UKspace is a membership organisation and we’re here to represent the interests of all of our members. But actually, when it comes to government backing, there’s no such thing as a bad choice; what we don’t want is no decision at all and we feel very much in that space at the moment.”

Like many other sectors, space incorporates quite a fragmented landscape. The Department for Science, Innovation and Technology (DSIT) is responsible for R&D, but procurement is occurring across the board, from the Department for Transport, the Department for Business & Trade and the Department for Environment, Food & Rural Affairs (DEFRA), and Alice explained that it is fiendishly difficult to find a way of pulling all those different requirements together into a procurement strategy which not only makes the most sense and creates the best value for government, but also creates a strong signal for the industry in order to leverage private finance.

“Our ability to make those cross-departmental decisions is something we really need to get right. It brings to mind the pioneering work that Baroness Louise Casey did when she was looking at troubled families and joining up the provisions that needed to be made across social services, education, crime, health and welfare.

“It’s not lost on me that every time I talk about the need for better cross-departmental coordination, people usually come up with that example; because it’s a rare example of it being done successfully.”

Sector success – 2030 and beyond

Part of the future success of the sector, Alice explained, is built around the sustainability of the operating environment – a combination of debris removal, space domain awareness and even space weather.

“If we focus our efforts there, we will have a very big contribution to make on the global stage because the benefit of UK companies can also be duplicated for our allies internationally as well.

“And in terms of creating the ability to manage our changing planet, the Earth observation programmes will be really strong, so if we can get the government procurement strategy right, we will increase the commercial opportunity.

“Space today fundamentally underpins our modern lives. If we took that away, we simply wouldn’t be able to live the way we do. That is going to be increasingly important in the future, so we need to act now to protect our capability or we will lose out.”

So, clear government procurement signals, stronger cross-departmental coordination and targeted support for SMEs will be critical to unlocking private investment and retaining strategic capability onshore. Sustainability, security and resilience in space are no longer optional – they underpin modern life and national security alike. The opportunity is clear; the challenge now is to move faster, align priorities and ensure the UK remains a leading space nation well beyond 2030.