Macron challenges Europe to rival US, China in space

By Tim Hepher, Giulia Segreti, Makini Brice
PARIS: President
Emmanuel Macron
threw France's backing behind plans for a European
satellite manufacturing
champion and called for accelerated deployment of Starlink-type satellites as he declared space the new theatre for world power competition.
Speaking at the Paris Airshow on Friday, after France moved to take control of Starlink competitor
Eutelsat
, Macron called for an energetic push spanning launchers to manufacturing and services as he set out a strategy to counter the sprawling rocket-to-telecoms interests of U.S. billionaire Elon Musk.
Staged amid the conflict between Israel and Iran, the world's largest aerospace event has mostly been dominated by geopolitical and trade tensions and fragile supply chains, rather than the usual glittering jetliner order announcements.
On Friday, attention turned from defence displays to space.
"At the intersection of all these public and private questions, as well as civil, military, scientific and industrial ones, space has in some way become a gauge of
international
power," Macron said in a speech to delegates.
Europe has taken a lead in Earth observation but has struggled for years to keep up with the United States and China in a domain now considered as strategic as the planet's oceans.
It lost independent access to orbit for more than a year in 2023 following technical problems, delays and a breakdown of ties with Russia over Ukraine that halted use of Soyuz rockets.
Despite Europe being the world's largest exporter of satellites, its two main manufacturers - Airbus and a tie-up between Thales and Italy's Leonardo - have struggled to make money and want to pool those activities.
"They have our full support and confidence. I want us to build this new champion as soon as possible," Macron said.
"This is what will allow us, as Europeans, to have the scale to improve competitiveness and volume. It's a sector consolidation."
Under pressure from Musk's cheaper low Earth-orbit Starlink satellites and a shift away from bespoke satellites in higher orbit, Airbus, Thales and Leonardo have said they are discussing plans code-named Project Bromo to forge a combined venture.
Previous efforts to pool satellite-making have been thwarted by competition concerns.
DEFENCE SPENDING
In a third battleground, the importance of satellite services and connectivity has been highlighted by Ukraine. On Thursday, France agreed to inject $1.55 billion into debt-laden Eutelsat, sending its shares soaring.
U.S. and Chinese spending on space dwarfs European budgets and insiders say industrial squabbling has curbed co-operation.
The
European Space Agency
says the U.S. accounted for nearly two-thirds of the global space budget in 2023; Europe just 11%.
Space budgets may get a lift from defence funds flowing into the sector. But fiscal room for Macron's new agenda is tight.
"Partnership between public and private capital will be needed and this requires a considerable effort", said Jean-Pierre Darnis, associate fellow at the Foundation for Strategic Research. France is struggling to get public finances under control after spending spiralled higher last year.
Europe is already hiking defence spending after U.S. President Donald Trump's team made clear that the United States was no longer willing to be the main guarantor of Europe's security.
"The big story of this show is sovereignty in the wake of some of the statements by (Trump) questioning U.S. commitment to Europe and to NATO," said Vago Muradian, founder of the Defense & Aerospace Report.
Macron flew into Le Bourget days before a NATO summit on a French Air Force A400M transport plane - itself a symbol of Europe's shifting priorities after years of battles over costs.
The future of Europe's troop plane had been under threat after some of its European NATO sponsor nations including France and Spain slowed the pace of deliveries or cut their orders. Exports have also fallen short of expectations.
But Airbus signed an agreement with procurement agency OCCAR at the show to stabilise production until 2029.
Weapons makers and buyers are increasingly touting the label "ITAR-free" to avoid getting caught up in U.S. export controls for certain components, a senior European industry official said. ITAR stands for International Traffic in Arms Regulations.
Some U.S. suppliers are scoping out ways of offering ITAR-free product lines to avoid being left out by the European spending wave, analysts said.
The commercial side of the show fell silent on Friday after being overshadowed by last week's crash of an Air India Boeing 787 jet in India. Boeing sat out any announcements as Airbus and Embraer rolled out deals earlier in the week.
Some airlines are shunning such shows to announce purchases in Washington or other capitals as aircraft become a currency of choice in a new style of transactional politics, delegates said.
Organisers said the show nonetheless had record attendance.

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