The three largest aerospace firms from Europe, Airbus, Leonardo, and Thales, announced they will be combining their space divisions into one yet-to-be-named company, all in hopes of better competing with the US commercial space market.

Europe’s space market has been on an upturn for a while now, but it is still far behind the boom that was seen in the US market in the late 2010s. While the US dominates in launch, satellite manufacturing, Earth observation, and even private space ventures (space tourism, Polaris Program, etc.), Europe is still dominated by just a few companies and a lack of a cohesive space program.

Three of those biggest players, Airbus, Leonardo, and Thales, have signed a memorandum of understanding for the merging of their space divisions. This would include the vast majority of what these companies do in space and the shares of other space companies, minus Airbus’s stake in ArianeGroup.

Actually, no space launch activities are included in the deal at all.

The project has been in the works for over a year and has been held up due to governance discussions and antitrust planning. The merging parties are confident they can begin operations in 2027, pending government approval and addressing any antitrust issues.

This is not that much different from what Boeing and Lockheed Martin did in the early 2000s when they merged their space launch divisions into United Launch Alliance. The main difference was that when ULA was formed, it was an absolute monopoly in the US and quickly began raising launch costs.

In Europe, there is a slow but growing commercial market that can and likely will compete with whatever the three decide to name themselves.