The biggest change in this year’s survey of the Top 50 space industry manufacturing and services companies is right at the top, where Lockheed Martin moves far past Boeing to take over the No. 1
The survey is based on annual revenue – in this case revenue companies brought in during 2006. Lockheed Martin’s space-related revenue in 2005 was $9.010 billion – just $90 million behind Boeing. For 2006 Lockheed Martin posted $9.8 billion in space-related revenue, an 8.8 percent increase.
By contrast, Boeing brought in $8.15 billion in space-related revenue during 2006, nearly $1 billion less than the $9.1 billion it achieved the previous year. Boeing spokesman Joe Tedino said in an e-mail that the lower 2006 amount reflected lower volume in the company’s government and commercial satellite manufacturing business and its 2005 divestiture of Rocketdyne, which was sold to United Technologies’ Pratt & Whitney division.
In an industry that has shrunk to just a few large prime contractors, Boeing and Lockheed Martin are both rivals and partners. Divisions in each company frequently team together to bid on different programs. The two also cooperate at a high level on joint ventures like United Space Alliance (USA), which maintains the shuttle fleet for NASA (USA revenue is counted separately in the Top 50 survey. The company’s 2006 revenue earned it the No. 8 spot on this year’s chart).
In late 2006 Lockheed Martin and Boeing formed another large joint venture, United Launch Alliance, which sells Atlas and Delta launchers to U.S. government customers, primarily the U.S. Air Force and NASA.
Both companies retained the rights to sell launches to commercial customers. Boeing will market commercial sales of the Delta 2 launcher, while Lockheed Martin will commercially market the Atlas 5.
In late 2006 Lockheed Martin also sold its interest in International Launch Services (ILS), a joint venture with Russian companies that had been responsible for marketing both the Russian Proton launch vehicle and the Lockheed Martin-built Atlas 5. Lockheed Martin sold its stake in ILS to Space Transport
Inc., a group of private investors.
Lockheed Martin’s ILS-related revenue up through the closing of that deal in October 2006 is included in this year’s chart. Similarly, the 2006 rocket-manufacturing revenue figures for Boeing and Lockheed Martin are included up through the formal creation of United Launch Alliance Dec. 1, 2006.
About the List
Putting together a list of the top space companies in the world takes a lot of research. The list is based on surveys Space News sends to companies in the business, interviews with company officials and in some cases, the filings that public companies make with financial regulatory agencies like the U.S. Securities and Exchange Commission.
Because most companies in the space field also have other lines of business and do not always break out space revenue in their financial reports, determining what business is space-related can be difficult. In recent years, with the advent of so much private-equity investment in space businesses, there are no public records to go by. That was the case this year with Magellan, one of the largest manufacturers of satellite navigation equipment, which is privately owned by Shah Capital Partners. It was also the case with imaging satellite operator DigitalGlobe.
Space-related revenue for some large companies with a small amount of space business is nearly impossible to determine. This year that was the case with Mitsubishi Electric, which builds satellites and satellite components, so it was left off the list.
The categories of space-related revenue include launch vehicle and satellite manufacturing, satellite and rocket component manufacturing, launch services, ground systems, engineering services and/or software, missile defense, satellite communication ground equipment and imagery sales and services.
Some categories of space activity are not included. Direct-to-the-consumer services, such as DirecTV, Echostar, Sirius Satellite Radio, WorldSpace and XM Satellite Radio, are not included because those companies derive most of their revenue not from satellite services but from subscription revenue and advertising. As such they are more like cable companies or broadcasters. We also do not include companies in the business of providing fixed satellite services, like Intelsat or
SES Americom, because we do a separate feature on those companies at a different time of the year.
– Lon Rains, Editor