Written evidence submitted by Orbex – (SSS005)
Written evidence submitted by Orbex – (SSS005)
Orbex is the only British-owned, Scottish-based space launch services company designing and building rockets in Scotland, creating high-value jobs and strengthening the domestic space sector. We are committed to delivering sustainable, flexible, and cost-effective satellite launch solutions from Scottish soil, with the first commercial launch planned in 2026.
With the global demand for launch services rising—currently dominated by the US-based SpaceX, where customers often face two-year waiting times — Orbex presents a significant export and sovereign capability opportunity for the UK and Scotland. By offering launch services internationally, we can help position the nation as a key player in the global space economy.
Headquartered in Scotland, with a subsidiary in Denmark, Orbex employs over 240 highly skilled professionals and has secured £129 million in funding from private and institutional investors, including the UK Government, Scottish National Investment Bank, leading European venture capital firms (BGF, Octopus Ventures, Heartcore, and High-Tech Gründerfonds), the Export and Investment Fund of Denmark (EIFO), Amentum, and Verve Ventures.
Orbex has worked closely with the Scottish Government since it chose to locate its headquarters in Forres, Scotland in 2019. Through Scottish Enterprise and Highlands and Islands Enterprise the company has also benefited from various loans and grants to support its growth.
Orbex is already making an economic impact in terms of spend with the UK and Scottish supply chains, which will continue to grow as manufacturing ramps up alongside launch cadence. In 2024, 50% of total spend was placed with UK based suppliers, with almost 20% of that spend placed with Scottish based suppliers.
Orbex operates over 6,650 square metres of space located across three facilities in Forres, and a dedicated testing site located at Kinloss, located 3 miles away from the main facilities. This infrastructure allows streamlined manufacturing and testing to take place. The company now employees over 140+ people in Morayshire, most of which are highly paid jobs, bringing new space-related skills to the area. Orbex has also been able to benefit from oil and gas and RAF related skills in the north of Scotland.
The team is currently investigating the development of a 10,000 square metre manufacturing facility which will support the ramp up of manufacturing further and is expected to create several hundred new jobs.
Notably, Orbex is one of only five private companies in Europe, and the only British one, with a frame contract to launch European Space Agency (ESA) satellites. This strengthens the UK’s position in the European launch market, boosting exports and generating revenue that directly contributes to the Exchequer and the Scottish economy.
Orbex is committed to further expanding its capabilities and competing on a global scale.
2. Proxima: Unlocking the Next Stage of Growth. Orbex’s long-term business plan centres on Proxima, a larger, next generation launch vehicle that will enable greater affordability, capacity, and mission flexibility.
Orbex is entering an exciting new phase, poised to scale up operations and solidify the UK’s position as a leading player in the global space industry. Our partnership with the UK Government, which could not have been achieved without DSIT’s support, has been pivotal in advancing Orbex towards the launch phase of Prime. With DSIT now an investor, there is an opportunity to strengthen this relationship and establish Orbex as a strategic partner for the wider UK Government.
Since the formation of the company, we have collaborated closely with the Scottish Government and bodies such as Highlands and Islands Enterprise in terms of funding as well as other aspects of the business including skills, housing and supply chain. They have explicitly supported the development of the space industry in Scotland and gained from the economic benefit that has been delivered. Our new relationship with the UK Government will allow us to deliver more growth and greater benefit to Scotland and UK.
In order to realise greater levels of growth and the associated benefits it is essential that the UK and Scottish Governments recognise the potential Orbex can bring and provide us with the additional supported needed. This includes supporting our bid for the ELC through the contribution of monies to the programme via ESA. This funding will realise the creation of jobs within Orbex, grow the supply chain and deliver stronger and enhanced sovereign launch capability. This capability will provide the Government through the MOD and its other departments with opportunities for launch, stimulating the domestic space sector.
We believe that the Industrial Strategy should embrace the space sector and include a sub- sector deal that focuses on the importance of launch. This presents a key opportunity for the UK Government to take a strategic view of the sector—leveraging both public and private investment to drive innovation, create high-value jobs, and position the UK as a global leader in commercial launch services.
In order to support growth of the space sector it is imperative that Government funding mechanisms such as the National Wealth Fund have the mandate that they need to provide long-term investment to Scottish and UK based Space companies like Orbex, to allow them to grow and thrive.
Competing on an uneven playing field
Orbex and the wider sector face a competitive disadvantage compared to our European partners, who are receiving substantially more government support.
According to 2023 OECD research, published by UKSA, France is investing four times more in civil space projects than the UK, with Italy (3x), Germany (2x), and Belgium (2x) also outspending the UK by significant margins.
This disparity in government support creates an uneven playing field, making it more difficult for Orbex to compete with better-funded European counterparts. Orbex believes that a modest increase in UK Government investment in space can take the sector a long way, helping us gain a comparative advantage against European partners and further than that, be competitive at a global scale.
Nature of the launch sector
Despite the growing demand for satellite launches and a limited number of suppliers in the market, customers remain hesitant to commit to new launch vehicles until they have demonstrated successful missions. This caution delays the flow of commercial revenue, creating a funding gap for companies in our sector.
Institutional funding from sources such as ESA and UKSA provides some risk mitigation, but these grants alone are insufficient to attract the level of private growth-stage capital needed to bring a launch service to market. While the UK Government has recognised this challenge— demonstrated by DSIT’s investment, for which we are extremely grateful—further support is essential to ensure the Scottish space sector can compete globally and continue to thrive.
While state support is key to the success of the Scottish space sector, it is also crucial that the UK Government commits to the success of the industry as a key national growth market. In this context, we welcome the Government ’s ongoing Industrial Strategy and encourage a stronger commitment to the sector’s long-term success.
In summary, Orbex is navigating a complex funding environment common to the sector, with delayed customer commitments, cautious private capital, and insufficient UK Government support. These barriers make it challenging to break into the market, despite the company’s strong potential to meet the increasing demand for sustainable and flexible launch services.
If the UK Government does not take decisive action to support its space sector, the country, and Scotland in particular, risks falling behind in a global industry that is growing at an unprecedented pace.
Other nations, including the US, China, France, and Germany, are making substantial investments to capture the value created by the space economy. A thriving space sector will
provide export potential for Scotland, with the global space industry is projected to be worth trillions in the coming decades.
Without a domestic space sector, the MOD will remain dependent on foreign launch providers, such as SpaceX, rather than developing sovereign capabilities that ensure independent access to space. This reliance on external providers introduces supply chain vulnerabilities and risks that could compromise the UK’s ability to deploy critical assets when needed.
Job creation will also suffer, particularly in regions like Northern Scotland, where space sector investment has the potential to drive significant economic growth. The space industry has the power to transform the Scottish economy by fostering new supply chains, training highly skilled workers, and attracting foreign direct investment—a potential that will remain unrealised if the Government fails to act.
Furthermore, the space sector is a key driver of technological advancement, with applications that extend far beyond launch services—from climate monitoring and communications to next- generation materials and AI-driven space technologies.
Initiatives like the ELC present an opportunity to address these risks by unlocking substantial funding for Scottish and British businesses. With greater investment in UKSA, HMT could help catalyse private capital and ensure Scotland remains competitive in a rapidly evolving industry. Without this commitment, Scotland risks being left behind, losing out on economic, security, and technological advantages to better-prepared global competitors.
The space industry has the potential to be a major driver of economic growth for Scotland, creating high-skilled jobs, strengthening supply chains, and enhancing global competitiveness. The global launch and satellite market, valued at $45 billion in 2022, is projected to grow to $63 billion by 2030, with the launch segment alone expanding from $11 billion to $15 billion.
Despite this rapid growth, the industry remains supply-constrained, with satellite demand quadrupling between 2017 and 2022 and a two-year waitlist for launch capacity in the Western world. This presents a significant opportunity for the UK and Scotland to establish itself as a key player in the market, but unlocking this potential requires sustained Government support.
We are calling for the UK Government to:
Job creation
With the planned scale-up of Prime and the development of Proxima, Orbex aims to expand its workforce to 570 employees by 2030 (2.75x its current size). These roles are not only new but also high-earning technical jobs in an industry poised for significant growth. The average salary in Orbex is £68,000, 2.4x higher than the UK median pay in 2022 according to the Office for National Statistics.
However, this expansion can only occur if the UK Government continues to show its confidence in the sector and its growth potential. Funding UKSA and providing a favourable business landscape will allow businesses like Orbex to thrive.
Orbex’s primarily Scottish-based job base will benefit as both Prime’s manufacturing and operations ramp up. The development of Proxima, a much larger rocket, will further boost the demand for skilled labour and manufacturing, creating additional economic activity.
Attracting private capital and foreign direct investment
UK Government support plays a crucial role in unlocking private capital and attracting foreign direct investment into the Scottish space industry. DSIT’s role as an anchor investor in Orbex is a key driver in the company’s four-year financing plan, which aims to secure an additional
£120 million in private capital. With a projected ratio of £1 in public funding leveraging £6 in private investment, the Government direct investment received by Orbex is at the centre of catalysing this level of financial commitment.
Further support for initiatives like the ELC would enhance Orbex’s access to the institutional European satellite launch market, significantly boosting investor confidence. Given the capital- intensive nature of the launch industry, ELC winners are likely to be the only companies able to attract the required private investment, driving consolidation in the European space sector.
By supporting Scottish space companies in a similar way, the UK Government can position Scotland as a premier destination for investment in space technology, reinforcing its status as a global leader in the industry and securing long-term economic benefits.
Regional growth
Orbex is a prime example of how targeted investment fuels regional development. With DSIT’s backing, the company is expanding its operations, creating high-skilled jobs in an area where such opportunities have historically been limited. This investment is not only driving direct employment but also strengthening local supply chains, attracting private capital, and boosting infrastructure development.
A clear example of supply chain stimulation is the integration of oil and gas infrastructure manufacturers into the space sector to support Orbex’s test and launch sites. Additionally, private investment in SaxaVord Spaceport in Shetland, where a dedicated launch pad is being built for Orbex, highlights how Government support can unlock further industry-led growth.
Crucially, the space sector provides a transition path for workers from traditional industries, offering long-term opportunities in a high-growth field. With the right support, space can
become a cornerstone of economic renewal in the North of Scotland, driving skilled job creation, technological innovation, and regional economic resilience.
Investing in the Scottish space industry presents a major opportunity to boost exports, drive growth, and generate significant tax revenues. The global race to provide small satellite launch services is accelerating, and Europe is investing to establish its own capabilities.
Orbex is in pole position to capture a substantial share of this market, as the only British company ever awarded a contract to launch ESA and EU small satellites. With 70% of Orbex’s current customer pipeline coming from European and US companies, the UK and Scotland have a real opportunity to establish itself as a leading player in the global launch market.
Beyond exports, a thriving space sector would deliver long-term fiscal benefits. As Orbex scales up operations, it expects to become a regular contributor to UK tax revenues, forecasting annual corporation tax payments exceeding £40 million by the early 2030s— equivalent to 7.5% of the company’s projected revenues. This would provide a substantial and sustained return to the Treasury, reinforcing the value of Government support for high-growth, high-tech industries. By backing Scotland’s space sector today, the UK Government can unlock a powerful engine for exports, innovation, and long-term revenue generation.
Orbex’s success will create a large number of jobs in Scotland. The Scottish space industry aims to create 20,000 jobs by 2030 and secure a £4 billion share of the global space market.
Funding pan-European initiatives like the European Launcher Challenge (ELC) would further enhance the UK’s economic and strategic position. Such programmes attract investment from other European states, amplifying the UK’s initial contribution while strengthening its influence in Europe. Crucially, participation in ELC would enable UK companies to serve EU institutional demand—ensuring that British businesses remain competitive in a market that might otherwise be closed to non-EU players.
By investing in Scottish launch capabilities, the UK Government can position Scotland as the premier satellite launch destination in Europe. The growing demand for small satellite launches presents a major economic opportunity, and with the right support, Scotland can attract customers from across the world—capturing market share that might otherwise go to competing nations. A thriving Scottish launch industry would generate exports, create high- skilled jobs, and establish the UK and Scotland as critical players in the European and global space markets.
Beyond economic benefits, investing in European launch capabilities is a matter of national and regional security. In an era of increasing geopolitical uncertainty, relying on non-European launch providers presents a strategic vulnerability. By supporting a sovereign launch capability in Europe, the UK Government can contribute to a more autonomous and resilient European space sector—ensuring that key defence and communications assets can be deployed without reliance on third countries. Strengthening European launch infrastructure would enhance both the UK’s and Europe’s ability to respond to global challenges, safeguarding economic and security interests for the long term.
Wider benefits to Scotland
Supporting the space industry would have far-reaching benefits for the wider Scottish economic, innovation, and political goals, beginning with national sovereignty.
From a climate and sustainability perspective, Orbex is building the world’s most sustainable launch vehicle, which aligns with the UK and Scottish Governments environmental goals.
Orbex’s rocket technology not only minimises carbon emissions but also enables the deployment of Earth observation satellites that play a critical role in climate monitoring and environmental protection. This allows for the monitoring of Scottish forests and peatland to maintain Scotland’s rich biodiversity.
Lastly, the innovations developed by Orbex have the potential to create significant spillover effects across industries beyond space and the wider R&D ecosystem. Advancements in materials science, propulsion systems, automation, and AI developed for spaceflight can be applied across industries.
Orbex’s cryogenic carbon fibre tanks, for example, have potential uses in the hydrogen sector for clean energy storage, while its 3D printing and non-destructive inspection technologies have applications in fields such as precision manufacturing. Increased Government support for space R&D would reinforce Scotland’s position as a leader in innovation.
We require the UK Government to continue to support the space sector and the launch element of this. We have outlined below the ways they can do this and the benefits of each.
Commitment to Funding the European Launcher Challenge (ELC)
We urge the UK Government to commit funding to the European Launcher Challenge (ELC) initiative. This investment will secure a sovereign, sustainable, and commercially viable launch capability in the UK, strengthening the domestic space sector and ensuring strategic independence.
The benefits extend beyond the industry itself—creating highly-skilled jobs, fostering supply chain growth, and driving innovation, particularly in Scotland, where the space sector is rapidly expanding. By supporting ELC, the Government will help solidify the UK’s position as a competitive space-faring nation while delivering economic benefits Scotland through increased investment and technological advancements.
Expanding the National Wealth Fund (NWF) to Unlock UK Space Sector Growth
Innovative space startups, including Orbex, need access to capital to scale successfully. The UK Government can play a vital role by expanding the remit of the National Wealth Fund (NWF) to include targeted investment in space launch companies.
At present, many UK-based space businesses struggle to secure the necessary financial backing to move from development to full-scale operations. By directing NWF investments toward high-growth space ventures, the Government can unlock the next generation of British space companies, fostering economic growth, supporting high-tech job creation, and ensuring the UK remains competitive in the global space race.
A Coordinated and Strategic Approach to Government Procurement of Launch
To ensure a sustainable UK launch industry, the Government must centralise its launch procurement through a dedicated team and establish a long-term pipeline of procurement opportunities. This should involve setting out national launch requirements years in advance, with options for pre-payment or early commitment to support commercial launch providers as they scale.
A clear and consistent demand signal from Government would provide industry stability, attract private investment, and enable British launch companies to develop in alignment with national needs. Additionally, the creation of a UK Space Council could provide a forum to coordinate Government priorities, streamline procurement, and reinforce the UK's commitment to launch.
The Ministry of Defence and other Government departments should prioritise UK-based companies like Orbex when procuring launch services or satellite deployments. This approach would stimulate growth in the sector, enhance supply chain resilience, and ensure that Government space requirements are met domestically. By leveraging its purchasing power, the Government can create a virtuous cycle of demand and investment, strengthening the UK’s space ecosystem and reinforcing Scotland’s position as a hub for space innovation.
Strengthening the UK’s Industrial Strategy to Support the Space Sector
To fully realise the UK’s industrial ambitions, we would support the Government strengthening its Industrial Strategy by integrating a clear focus on high-growth sectors like space, particularly in launch services. Embedding a dedicated space sub-sector plan within the broader industrial framework would provide clarity, attract investment, and enhance the UK’s position as a leader in advanced manufacturing and technology-driven industries. Aligning industrial policy with national economic and security objectives will drive long-term growth, innovation, and global competitiveness across the UK’s high-value manufacturing and technology sectors.
By implementing these measures, the UK Government can unlock the full potential of the domestic space industry, driving economic growth, job creation, and global competitiveness in this critical sector.
March 2025