① Gravity 1 set a new record for the world's most powerful solid rocket and China's most powerful civil and commercial rocket. ② The successful launch of Gravity 1 can provide some practical capacity for China's high-score remote sensing constellations, satellite internet launches and networking. ③ Referring to the development history of SpaceX, it is estimated that in the next ten years, China's commercial rocket core will benefit from the construction of satellite constellations, and the market space will reach 100 billion dollars.
Financial Services Association, January 11 (Reporter Guo Songqiao) At 13:30 on January 11, 2024, Beijing time, China successfully launched the Gravity-1 Yao1 commercial launch vehicle independently developed by Oriental Space Company in the waters off Haiyang, Shandong, and successfully launched the Yunyao-1 18-20 satellite on board into the scheduled orbit, and the flight test mission was a complete success.
A Financial Services Association reporter learned at the launch site that Gravity 1 set a new record for the world's most powerful solid rocket and China's largest commercial rocket. The first flight used a difficult sea launch, marking significant progress in China's independent innovation of solid launch vehicles, expanding the diversified and large-scale launch capabilities of China's medium- and low-orbit satellites, and further enriching China's launch vehicle type spectrum.
The successful launch of Gravity 1 is a microcosm of the rapid development of private commercial space in China. Since this year, good news about China's private space has been spreading frequently. In April, “Tianlong 2” successfully flew for the first time, making the first private liquid rocket successful; in June, “Power Arrow 1” Yao2 was successfully launched, enriching the launch capability spectrum of China's solid launch vehicles; in July, “Suzake-2” Yao2 was successfully launched, making it the world's first liquid oxygen methane rocket to successfully fly into orbit...
Yao Song, co-founder and co-CEO of Oriental Space, said in an interview with the Financial Services Association that the successful launch of Gravity-1 is of great value to China's aerospace industry. It can provide some practical capacity for China's high-score remote sensing constellations and satellite internet launches and networking. “Many policies have been introduced this year to motivate all citizens to work with the power of the country to complete the national satellite Internet construction mission more quickly and at a lower cost. This is the first model of all commercial space rockets that can have enough carrying capacity to obtain such a model that makes a certain contribution to the country's satellite Internet.”
On the topic of commercial space circuit investment, Yao Song told the reporter that the peak period of investment in the aerospace industry occurred in 2019-2021. The industry has been relatively slow in the past year or two, but it has been picking up since the end of 2023. Among them, the Central Economic Work Conference mentioned the need to use scientific and technological innovation to promote industrial innovation and develop new quality productivity. Build a number of strategic emerging industries such as biomanufacturing, commercial aerospace, and low-altitude economy. According to observations, many government guidance funds and funds that are more sensitive to policies now focus on the space industry.
“Focus on cultivating companies with market application prospects”
The aerospace industry is a concentrated expression and an important symbol of the country's comprehensive national strength. The Central Economic Work Conference emphasized the need to improve the resilience and safety level of the industrial chain supply chain; vigorously promote new industrialization, develop the digital economy, and accelerate the development of artificial intelligence; and build a number of strategic emerging industries such as biomantry, commercial aerospace, and low-altitude economy.
Looking back at commercial space development, it can be seen that 2015 was the first year of commercial space development in China. In that year, the National Development and Reform Commission and other departments jointly issued the “National Civil Space Infrastructure Medium- and Long-Term Development Plan (2015-2025)” to guide social capital to participate in the construction of the country's civil space infrastructure, marking the path of China's aerospace integration with the government and market.
2019 was also a critical year for China's aerospace. The National Defense Bureau of Science, Technology, and the Equipment Development Department of the Central Military Commission jointly issued the “Notice on Promoting the Standardized and Orderly Development of Commercial Launch Vehicles”, which for the first time carried out comprehensive regulations and requirements on matters relating to scientific research, production, testing, launch, safety and technical control of commercial launch vehicles.
Due to the strong driving force of the commercial space industry and many related industries, Beijing, Shanghai, Tianjin, Shenzhen, Shanghai, Wuhan, Ningbo, etc. have successively introduced commercial space development policies, and commercial space industrial parks and bases have also been launched in many cities.
At the local level, local governments such as Beijing, Shanghai, Tianjin, and Shenzhen have introduced support policies for the aerospace industry. The General Office of the Beijing Municipal People's Government issued the “Beijing Implementation Plan for Promoting Future Industrial Innovation and Development”, which proposes future space exploration needs in the field of future space and focuses on developing industry segments such as commercial aerospace and satellite networks.
In terms of promoting the development of the commercial space sector, Shanghai recently issued the “Shanghai Action Plan to Promote Commercial Space Development and Build a Highland for the Spatial Information Industry (2023-2025)”. The plan is proposed to form a full-coverage industrial chain from rockets, satellites, ground stations to terminals by 2025. Introduce and cultivate 10 new key commercial aerospace enterprises, cultivate 5 hard-core enterprises preparing for listing on the Science and Technology Innovation Board, support a number of private “specialized, special and new” advantageous enterprises, and achieve a scale of more than 200 billion yuan in the spatial information industry.
Jin Zhonghe, director of the Zhejiang University Microsatellite Research Center, said in an interview with reporters that judging from global experience, commercialization of the space industry is the general trend. In the process of developing space resources, civil forces can complement and form healthy competition with “national teams.”
At the same time, Jin Zhonghe pointed out, however, that at present, China is also facing less demand for commercial space, and domestic competition is quite fierce and cruel, which ultimately results in very limited resources for manufacturers. China's overall satellite development model is still limited to some of the original traditional models, including institutional and commercial operation. The future needs to overcome practical problems such as high costs, large cost investment, inadequate capital support, and unclear market applications. From a capital perspective, we should focus on cultivating enterprises with market application prospects, and we should repeatedly demonstrate the market prospects of applying their technology before investing.
In terms of the market, what type of satellite has increased demand the most in the sky? Yao Song pointed out to reporters that the three traditional applications of satellites are called telecommunication, navigation, and remote sensing. Currently, the biggest increase is satellite internet. The infrastructure scale of the entire satellite internet is no less than that of the original three major operators, because it is equivalent to the entire 6G next-generation communication infrastructure, but these related tasks have not been released that quickly. There are still a few years left. In the long run, it is the launch of satellite internet, which may account for more than 70% or even 80% of all new increases.
“Investment funds are gradually picking up in the space industry recently”
A Financial Services News reporter learned that since the national policy supported commercial space development in 2015, civil and commercial rockets have grown rapidly, and various 300 kg and 1.5 ton carrying capacity rockets have already been launched. Gravity 1 is the first domestic commercial rocket with a carrying capacity of 4 tons/500 kmSSO. It will push China's commercial aerospace technology level and market application to a new level.
Shi Shengqing, CFO of Oriental Space, said in an interview with the Financial Federation that in recent years, from a global perspective, the overall number of rocket launches has shown a rapid growth trend. In 2020, the total number of rocket launches worldwide was around 120. By '22, this number should have grown to more than 190, and close to 205 in 2023. It has actually doubled in three years, and the overall figure is still showing a rapid increase. For example, the US SpaceX is scheduled to be launched 100 times in 2023, actually more than 90, then it is planned to launch 144 times in 2024. Our country's total number of launches in 2023 should be close to 70, but the current launch plan in 2024 should have exceeded 90, so the overall plan is expected to increase by 30% + on a three-year doubling basis.
Shi Shengqing said that overseas is clearly driven by commercial launches. Domestically, it has also begun to show this trend in the past two years. In 2020 and 2021, there is still only one commercial rocket launch, 5 in 2022, and more than 10 in 2023. Currently, there will definitely be further growth this year, so the overall trend is also showing rapid growth.
Shi Shengqing also admits that in fact, even under this growth situation, the entire market is clearly in short supply. In 2023 alone, as an example, there is still quite a lot of demand for commercial satellites. They are purchasing some models of rockets within the system. Because the model tasks are out of line and demand cannot be met, they may have at least three or more rockets of this type, so it is still quite obvious that they are dealing with the overall tight supply and demand situation. Moreover, there are currently some estimates on the market. Facing the next 3 to 5 years, with the construction of the country's large remote sensing constellations and low-orbit communication constellations, it can be said that until 27-28 years, the entire rocket may not be able to meet the growth in demand for satellite launches. This is on the market side. So in general, more rockets are needed to provide.
Kim Joong-hwa believes that both commercial rockets and satellites are high-tech industries that require not only technical support, but also large amounts of capital and manufacturing industry chain support. Competition in the rocket field is very cruel. Demand has yet to explode. The entire commercial rocket market in China is still in its infancy. The real commercial closed loop has not yet been fully established, and there is still a long way to go.
Yao Song told reporters that in the early days, due to relatively unclear national policies, investors were relatively cautious, and only some dollar funds with a particularly long funding cycle, such as Jingwei China, dared to invest. The peak period of investment in the aerospace industry occurred in 2019-2021. The industry slowed down relatively in the past year or two, but it began to pick up at the end of 2023. Among them, the Central Economic Work Conference mentioned the need to use scientific and technological innovation to promote industrial innovation and develop new quality productivity. Build a number of strategic emerging industries such as biomanufacturing, commercial aerospace, and low-altitude economy. According to observations, many government guidance funds and funds that are more sensitive to policies now focus on the space industry.
The Financial Services Association reporter also noticed that the gap in the market has brought “investment fever” to the commercial rocket sector. The CITIC Securities Research Report predicts that in the commercial space era, space activities follow profit as the main purpose and follow a market mechanism, so the low cost and large capacity of launch vehicles is a future trend. Referring to the development history of SpaceX, it is estimated that in the next ten years, China's commercial rocket core will benefit from the construction of a satellite constellation, and the market space will reach 100 billion dollars.