At Long Last, Europe Has an Answer to SpaceX (or Does It?)

In 2015, SpaceX changed the space industry, launching and then landing a Falcon 9 orbital-class rocket for the first time in history. Four months later, SpaceX improved on that performance, landing a different Falcon 9 on a drone ship at sea, and over the succeeding years, SpaceX racked up more successful launchings and landings of reusable space rockets, lowering its cost of each rocket with every reuse.

With the threat posed by SpaceX's reusable rockets growing too great to ignore, Airbus (OTC: EADSY) sub-subsidiary Arianespace announced Europe would build a reusable rocket of its own. Dubbed ADELINE, for Advanced Expendable Launcher Innovative Engine Economy, this rocket was designed more like a space shuttle, riding rockets to space before landing back on earth like an airplane. A couple of years later, Ariane changed its mind again, announcing a Prometheus reusable rocket that could launch and land on its tail, just like a Falcon 9.

But since then... crickets.

Citing the need to maintain an economically viable rate of rocket production to preserve European jobs, in 2018 Ariane and its parent company, ArianeGroup, elected to stick with expendable rockets, pouring money into finalizing the design for a new Ariane 6 rather than developing either ADELINE or Prometheus. Ultimately, this resulted in Ariane 6's much delayed July 2024 launch.

Problem is, Ariane 6 still isn't cheap enough to compete with SpaceX's Falcons. And so Arianespace is going back to the drawing board, and announcing for the umpteenth time that it is finally ready to try a reusable rocket design.

Introducing MaiaSpace

To be precise, it's not Arianespace itself, but another subsidiary of ArianeGroup -- MaiaSpace -- that will design the new rocket.

Little is known about the rocket at this time, however. A June 2023 interview with the subsidiary's CEO, Yohann Leroy, didn't divulge so much as the name of the new rocket. What investors do know is that it's supposed to be a small rocket. Not as big as Falcon 9, it's only supposed to be able to put about 1.5 tons in orbit, making it more of a competitor to Rocket Lab (NASDAQ: RKLB) than to SpaceX.

It's also known that it is being designed to launch from land and land on a barge at sea. Leroy added that the company has 10 potential clients interested in launching on the new rocket, and that MaiaSpace hopes to have it ready for a first launch by 2025.

Take that date with a grain of salt.

Last month, MaiaSpace secured a launch site when France's National Centre for Space Studies (CNES) agreed to let it launch from the former Soyuz launch pad at the Guiana Space Center. Launches won't be able to start before 2026 or 2027, however.

What it means for investors

What should space investors make of these promises?

Given Arianespace's spotty record of announcing reusable rocket plans only to cancel them later, I'd actually recommend consuming this news with a few extra dashes of salt -- the more so because Arianespace offered significantly more detail about its plans for building both ADELINE and Prometheus than it's divulged so far about MaiaSpace's new rocket. For all the CEO's protestations that his company is "not at all a 'Powerpoint' company" (i.e., not vaporware), the future for this rocket looks even hazier to me than did those for previous reusable rocket designs.

And remember, those two more substantial promises still evaporated in the harsh light of reality.

Personally, I'm going to want to see a lot more detail on MaiaSpace's proposed rocket, and specifically some financial detail on the economics of trying to reuse small rockets despite their much more limited fuel capacity, before I believe this one will fare any better. Even Rocket Lab hasn't made much headway in reusability of small rockets, and it's the leader in that market right now. Instead, Rocket Lab seems to be placing most of its reusability bet on a much larger Neutron rocket.

If Europe ever hopes to have a reusable rocket of its own, maybe that's the way it should go, too.

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Rich Smith has positions in Rocket Lab USA. The Motley Fool recommends Rocket Lab USA. The Motley Fool has a disclosure policy.