Isar Aerospace won €197.8 million for a rocket that has flown 30 seconds

The European Space Agency has signed its first contracts under the European Launcher Challenge. Three German and Spanish rocket startups now have until 2028 to get to orbit.

ESA announced the awards on Thursday, describing them as a push to expand Europe’s launch options and reduce reliance on SpaceX.

Spectrum has flown for 30 seconds and just won €197.8 million

Munich-based Isar Aerospace won the biggest of the three prizes, about €200 million ($233 million), the company said in a statement Thursday.

The contract, worth €197.8 million, is funded mainly by Germany, with contributions from Austria and Norway, ESA said.

Isar is working on Spectrum, a two-stage rocket 28 meters high with ten engines. In 2025, the vehicle flew for 30 seconds from a dedicated pad at Andøya Spaceport in Norway before coming down.

A second Spectrum is being groomed for a qualification flight with payloads the company hopes to place in orbit. In its current form, the rocket can carry up to 1,000 kilograms into low Earth orbit.

“Europe is putting serious resources behind its space sovereignty and today’s agreement with ESA is another proof point,” said Isar chief commercial officer Stella Guillen.

Other contracts were inked with Rocket Factory Augsburg (RFA) and Spain’s PLD Space. RFA, also in Germany, took €186.9 million to develop its RFA One vehicle, a three-stage rocket that will launch from the SaxaVord pad in the UK.

RFA One will deliver a payload of up to 500 kilograms to a 500-kilometer sun-synchronous orbit.

PLD Space has procured €158.9 million, mainly backed by Spain with support from Germany. In 2023, the company flew its Miura 1 demonstrator from Spanish soil and is using it to develop the larger Miura 5.

Miura 5 will launch from Europe’s Spaceport in French Guiana and lift up to 540 kilograms to a sun-synchronous orbit.

A fourth challenger, MaiaSpace, has not yet closed. ESA said its award process “is nearing completion and expected to resume in the coming weeks.”

The contracts don’t pay cash up front. Companies free up funds when they reach agreed milestones, and every provider must make an orbital launch before 2028 to prove it can deliver.

Proposals were due April 2026 and were appraised by an ESA board on business case, engineering quality, resources, schedule, and compliance.

“Now it is up to the challengers to prove they can deliver reliable launch services for Europe and compete,” said Lucia Linares, ESA’s head of strategy and launches for space transportation. “Getting to space is not easy and never guaranteed.”

Géraldine Naja, ESA’s director of space transportation, said the awards were meant to drive “competition among European launch providers.”

Bernard Liautaud calls Europe’s SpaceX reliance a huge risk

The funding comes as European governments aim to reestablish independent access to space for civil, commercial, and defense missions and to lessen their reliance on Elon Musk’s SpaceX, the dominant global launch provider.

Earlier, Balderton Capital managing partner Bernard Liautaud said the continent’s reliance on SpaceX was a “huge risk” and Europe needed to be “more self-sufficient.” SpaceX has been valued at around $400 billion.

Leonardo, Airbus, and Thales have agreed to meld their satellite businesses in a new company with annual revenues of some €6.5 billion ($7.5 billion), expected to start operations in 2027 pending regulatory approval.

“Launch capacity is an elementary interest of a state,” said Andreas Schwarz, an SPD member of the parliamentary budget committee in Germany.

Governments should look at a broad range of options, from long-term launch commitments to taking stakes in providers to get satellites in orbit when needed, he added.

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