Melco Expansion Aimed at Doubling Satellite Revenue

by

PARIS — Mitsubishi Electric Co. (Melco) of Japan on June 6 said it is investing in new satellite production and test facilities as part of a strategy to double its annual satellite-related revenue to $1.9 billion by 2021.

Tokyo-based Melco, whose first commercial satellite built for a non-Japanese customer was successfully launched May 20, has said in recent months it would be more aggressive on the commercial market now that its DS2000 satellite frame has been proved in orbit with Japanese commercial and technology-demonstration missions.

The ST-2 satellite launched May 20, owned by a joint venture of Singapore Telecommunications Ltd. (SingTel) and Chunghwa Telecom of Taiwan, will be followed by the Melco-built Turksat 4A and Turksat 4B telecommunications satellites in 2013 and 2014. The Turksat competition featured a lively international competition with U.S. and European satellite builders.

In its June 6 statement, Melco said it is expanding its Kamakura Works satellite production facility to enable the company to “reduce costs and shorten delivery time” to enable Melco to double its satellite-related annual revenue to 150 billion yen, or about $1.9 billion at current exchanges rates, by 2021.

The company said it will spend 3 billion yen on the new plant and equipment, which will enlarge Melco’s total satellite production, integration and test floor space to 7,700 square meters. The Kamakura facility has produced 18 satellites in addition to components for Japan’s H-2 Transfer Vehicle, an unmanned freighter that is launched atop Japan’s H-2A rocket to deliver supplies to the international space station.

Melco said Japan’s new space policy, announced in 2009 and focusing on commercial and applications-focused satellites instead of just research spacecraft, is one reason for the investment, as is the health of the commercial satellite market, whose current global demand is about 20 geostationary telecommunications satellites per year.