I’m catching up over the holidays so here is a bit of a roundup of recent Rocket Lab news.

Rocket Lab to Open New Manufacturing Complex in Maryland: Rocket Lab USA, an aerospace company based in Long Beach, is set to open a new manufacturing complex in Maryland. This expansion marks a significant step for the company, enhancing its production capabilities. Source: Press Telegram

US Military Contracts Rocket Lab for 2025 Hypersonic Test Vehicle Launch: Rocket Lab has been contracted by the US military to launch a hypersonic test vehicle in early 2025. The launch is scheduled to take place from Rocket Lab’s Launch Complex 2 in Virginia, highlighting the company’s growing involvement in defense and space research. Source: Space.com

Venus Mission Planned by Rocket Lab for Late 2024: Rocket Lab is planning a privately funded mission to Venus, expected to launch at the end of 2024 and arrive at the planet in May 2025. This ambitious project underscores Rocket Lab’s capabilities in deep space missions. Source: SpaceNews

Rocket Lab’s Electron Launch Vehicle Fully Booked for 2024: Rocket Lab’s Electron launch vehicle is fully booked for the next year, contributing to an expected revenue increase to between $95 million and $105 million in the first quarter of 2024. This demand highlights the Electron’s success and reliability in the space launch market. Source: Yahoo News

New Engine Development Center Opened by Rocket Lab: Rocket Lab has opened a new engine development center in a building formerly used by Virgin Orbit, their competitor. This new facility in Long Beach will bolster Rocket Lab’s capabilities in engine development and innovation. Source: SpaceNews

There have been hints that Australia was going to get much more involved with the new space economy and the space defense sector but with this move by the White House leaves no doubt:

Our focus on innovation also extends to space, where we look forward to tomorrow’s signing of a space Technology Safeguards Agreement that creates the potential for new space-related commercial opportunities while providing the legal and technical framework to protect sensitive U.S. space launch technology and data in Australia consistent with our shared non-proliferation goals. We also welcome progress in negotiations of a bilateral space framework agreement, and encourage further joint commercial investment across all sectors, including space situational awareness and commercial space stations.

This mean US based companies and vehicles can now launch from Australia:

“The TSA is required to allow the export of U.S.-built launch vehicles to Australia. Industry officials in Australia said the agreement will allow spaceport projects there to sign long-awaited deals to host launches by American companies. “We hear regularly from both the U.S. government and industry of their demand for this capability in Australia,” said Jeremy Hallett, executive chairman of the Space Industry Association of Australia, in a statement. “This agreement removes the blockage stopping this demand being met by Australian space industry and we look forward to the new business opportunities that will emerge for the industry.”

Varda Space Industries is also lining up Australia as the return point for its in-space manufacturing capsules:

Varda launched its debut mission on SpaceX’s Transporter-8 mission in June, and the capsule remains operational in space. Varda will land its future spacecraft at the Koonibba Test Range northwest of Adelaide, Australia under a newly announced agreement with Southern Launch. The first missions to use the site will land as soon as 2024, SpaceNews said in a report.

And don’t forget that Rocket Lab launched an Australian subsidiary in February:

“Australia has an accomplished history in the space sector having developed strong capabilities in Earth observation, space tracking and satellite operations. Coupled with Australia’s renewed focus on industrial capability and advanced manufacturing, the industry is now poised for an era of rapid expansion driven by new technology, a growing demand for space enabled data, private investment, and a significantly increased funding commitment from the Australian Government,” said Rocket Lab founder and CEO Peter Beck. “Rocket Lab has already played a key role in supporting Australia’s rapid growth in space by flying several commercially developed Australian satellites on Electron, as well as having launched national security payloads developed in partnership with Australia’s Department of Defence. Our space systems technology has also featured on Australian missions, enabling Australian technology already relied upon by the nation. By building on our deep expertise and proven heritage as a global leader in launch and space systems, Rocket Lab is well positioned to advance Australia’s capabilities in space. We have people on the ground already and we look forward to exploring opportunities where they make strategic sense for us as a business, and where we can truly strengthen Australia’s position in the global space sector.”

Rocket Lab has also partnered with Hypersonix, an Australian hypersonic startup, and will launch their DART AE vehicle sometime next year as part of its HASTE program. This agreement could allow Rocket Lab to service Australia’s defense sector at their home base without rocking the boat in New Zealand which, while nearby, historically isn’t too keen on hosting work directly related to defense.

This should be a massive shot in the arm for Australia’s space ambitions and should result in a surge of announcements in 2024 (and beyond.)

Leidos has booked four new HASTE missions with Rocket Lab:

The missions, scheduled across 2024 and 2025, will lift off from Rocket Lab Launch Complex 2 at Virginia’s Mid-Atlantic Regional Spaceport within NASA’s Wallops Flight Facility. Rocket Lab was selected by Leidos to provide hypersonic test launch capabilities with HASTE under the MACH-TB project. The project was awarded by Naval Surface Warfare Center (NSWC) Crane through the Strategic and Spectrum Missions Advanced Resilient Trusted Systems (S2MARTS) Other Transaction Authority (OTA) vehicle on behalf of the U.S. Department of Defense Test Resource Management Center (TRMC).

While that’s a pretty big deal, I still think it’s a drop in the bucket compared to what’s about to come as hypersonic research heats up.

At the Morgan Stanley 11th Annual Laguna Conference last week Rocket Lab’s Manager of Investor Relations, Colin Canfield, said they eventually see HASTE also being used as a target for counter-hypersonic weapons. That will be a really profitable way to “decommission” flight hardware that has already seen multiple uses.

Hypersonic Missiles Are Game-Changers, and America Doesn’t Have Them

Hypersonics, in the hands of powers such as China or Russia, have the potential to alter the strategic balance that has long undergirded U.S. defense policy. While the U.S. military may still be the most powerful in the world, hypersonic missiles could help an adversary challenge that superiority by evading U.S. early warning systems designed to detect attacks on North America, or striking U.S. naval assets, including aircraft carriers, as well as key bases abroad.

Even the most advanced U.S. warship in the South China Sea could be defenseless against a hypersonic attack.

The piece just gets more worrying from there. Of course, New Space players like Rocket Lab are surging into this void to help close the gap as quickly as possible:

On April 17, 2023, Rocket Lab announced its new HASTE (Hypersonic Accelerator Suborbital Test Electron) launch vehicle, designed to provide high-cadence suborbital flight tests to advance hypersonic technology development. HASTE addresses the U.S. Department of Defense’s (DoD) need for reliable and cost-effective hypersonic testing capabilities, which have previously been limited. As a fully operational launch vehicle, HASTE will allow for rapid and frequent hypersonic and suborbital tests from Rocket Lab’s existing launch site in Virginia, accelerating U.S. and allied progress in the hypersonic domain.

As is usually the case, the US government falls behind, but then marshals resources to surge ahead. Expect that scenario to play out here in the next few years. However, the concern is that China may seek to move on Taiwan before their advantage erodes.

Rocket Lab presented at the Bank of America Virtual SMID Conference yesterday. You can watch the recording here. Some quick notes:

• Rocket Lab is, and can continue to be, selective in their customer choice - choosing to work very strategically to choose high margin work that benefits all parties.
• Defense/Government segment of the business helps insulate the company in more constrained environments.
• They continue to make progress on the margin front for both launch and space systems. They are ahead of expected progress on the space systems side of the business.
• Pent up commercial demand and increasing government budgets are driving significant opportunity on the space systems front.
• Highlights strategic importance of relationships with Varda, Earth Intelligence, and direct to mobile customers in driving the scale of Rocket Lab’s business and shareholder value.
• Importance of vertical integration: Can deliver value to the customer across space systems and launch fronts. Minimizes risk, complexity, and cost for the customer.
• Neutron development costs will ramp (as expected) through 2024 with an expected first launch still planned for Q4.
• No planned short term M&A. Company has significant assets with current portfolio.
• Virgin Orbit acquisition gives the company the extra footprint it needed to enable the kinds of scale they want to achieve. Company can evolve into a “serialized producer” of components or spacecraft.
• On target for 15 Electron launches in 2023 and 20 in 2024 with average sale price hitting the $7.5M target average.
• HASTE demand is expected to scale on both the civil and defense front. Low single digit HASTE launches are planned for 2023 and 2024 but after that customers might need on the order of “tens of launches” to operationalize a product.
• Counter-hypersonic system development is expected to become a significant market, possible the largest market, in the next couple of years.
• Recovery programs are on track and expected to provide significant margin support in the future.
• Initial development of spacecraft for customers like Varda and MDA could be leveraged to develop platforms that could be serialized for mass production later.
• Key milestones for Neutron in 2023 continue to be “frosty tanks” and “hot fire” as stage 2 cryogenic starts and Archimedes testing ramps up.
• Current small launch competition is limited. The only real operational competition is Northrop Grumman’s Minotaur which is significantly more expensive at ~$30-40M per launch compared to Electron’s $7.5M.
• The most significant medium launch competitor is the SpaceX Falcon 9.
• Target 20x reuse for Neutron (vs ~10 for Falcon 9). This is primarily achieved by running Archimedes significantly under its full potential.
• Key space systems competition is on the solar front in Boeing’s Spectrolab and Germany’s Azur Space. “We have been happy to let those competitors fill up their fabs with lower margin work.”
• Space grade solar is incredibly constrained which allows Rocket Lab to continue to be very strategic in customer selection or prioritize product for in-house use while competitors struggle with supply chain constraints.

Between SmallSat 2023 and Q2 earnings there’s so much going on. Here’s a quick roundup of some of the stuff I’m tracking:

• Rocket Lab results match Wall Street estimates, company adds contracts for 10 launches - View the deck here.
• Rocket Lab announced additional progress on Neutron. I’ve updated my Neutron development page with the updates.
• 5 of the ten new launches that Rocket Lab booked this quarter are for BlackSky’s next-generation Gen-3 satellites.
• BlackSky reports Q2 2023 earnings before the open tomorrow.
• Spire Global Awarded Space Services Contract by GHGSat to Expand Satellite Constellation for Emissions Monitoring
• Spire also reports Q2 2023 earnings tomorrow.
• Rocket Lab has booked another HASTE hypersonic launch out of Wallops for a “confidential customer.”
• Space company Redwire trims quarterly losses, builds order backlog past $270 million

I think we’re going to see some big developments in the pace of hypersonic research before year’s end. HASTE looks like a gamechanger.

The U.S. government is clearly moving to address the gaps in our national development programs and a lack of launch opportunities (prior to HASTE) is just one of them. There are supply chain, manufacturing, research, even challenges in development of the personnel needed to stand up efforts in all of these areas. China, seeking to seize the destabilizing potential of hypersonics, has been more focused. While the U.S. government can be, and often is, slow to recognize an opportunity, it can move with astounding effect to close a gap when that gap poses a very real challenge to its power. I think we’re seeing that shift now.

Rocket Lab’s hush-hush launch of it’s first HASTE flight on the 17th will, in time I think, be recognized as a very big deal. There’s incredible pent-up demand for rapid-cycle testing for both military and commercial applications and Rocket Lab’s modified Electron and operational prowess have positioned it at the right place and at the right time:

“The success of this mission demonstrates collaboration across government and industry partners to change the paradigm in hypersonic testing,” said Brian Rogers, Rocket Lab’s senior director of global launch services, in a statement. “HASTE enables the frequent, affordable flight testing needed to advance the nation’s hypersonic technology development.”

Speaking at the Stifel 2023 Cross Sector Insight Conference (Audio) recently, Rocket Lab’s CFO said that they see “dozens and dozens” of launch opportunities emerging in the “not too distant future” and can build an Electron a week to service the market if necessary. Interesting!

Rocket Lab never misses on mission patches either. I’m hoping this one will show up in their store in a few days: