An antitrust controversy is growing over the integration of the space business institutional sector of major European defense and aerospace corporations. If the merger pushed by Airbus, Thales, and Leonardo S.p.A. goes through, some noted it could reduce competition in public space programs within Europe.
According to the Financial Times on the 5th (local time), Marco Fuchs, CEO of German space and satellite manufacturer OHB, said of the three corporations' combination of their space businesses, "When governments place orders for public space programs, the number of suppliers they can choose from will shrink."
Fuchs criticized the integration as "a merger that hinders competition" and "not desirable for European citizens, the taxpayer, or the market's supply structure."
Codenamed "Bromo," the merger was agreed to in Oct. last year by Airbus, France's Thales, and Italy's Leonardo S.p.A., the largest aerospace corporations in Europe. The three corporations plan to soon file for a formal antitrust review with European competition authorities.
The plan is said to draw on the joint venture model of MBDA, a missile manufacturer involving Airbus, Leonardo S.p.A., and Britain's BAE Systems. With Elon Musk's SpaceX and Starlink rapidly expanding their influence in the satellite communications market, the three corporations argue European corporations must scale up to respond.
However, CEO Fuchs drew a line against that logic. He argued that while SpaceX is a corporation strong in launch vehicles and satellite communication services, the three pursuing the merger have mainly built satellites for European institutional clients, making the direct competitive landscape different.
He said, "The issue is not a frame like 'evil Elon.' The point is that a monopolistic structure is being created within Europe."
Fuchs said he fears that if the number of bidders decreases in major space projects such as Galileo, commissioned by the European Space Agency (ESA), the European Commission, and national governments, the long-term expense burden could grow.