TEL AVIV – Thursday's loss of the Israeli-built Amos-6 communications satellite in a launch pad explosion at Cape Canaveral marked a strategic setback, but also opportunities, for the Israeli space industry, whose follow-on orders were threatened by the planned sale of Spacecom, the Tel Aviv-based satellite operator, to a Beijing conglomerate.
Spacecom's Amos-6, an estimated $200 million satellite built by state-owned Israel Aerospace Industries (IAI), was deemed a total loss after the Space-X Falcon 9 launcher to which it was attached blew up during a static engine test. In its report to the Tel Aviv Stock Exchange, Spacecom said the "anomaly" would have "substantial influence" on the company.
Just last week in an Aug. 24 notice to its principal shareholders, Spacecom said it had agreed to sell the company for Xinwei Technology Group for $285 million in cash. The firm noted that the sale was contingent upon the successful launch of the Amos-6, planned from Cape Canaveral, planned for this Saturday, Sept. 3.
Now, with that planned deal clouded by uncertainty, Israeli industry executives and experts here say IAI may have greater chances of snagging an Amos-6 replacement order as well as follow-on contracts that may have gone to non-Israeli firms once the sale was complete.
Industry executives here said Spacecom has been in communication with US firms Boeing and Loral for price and availability data for its follow-on Amos-7 and possibly Amos-8 satellites.
And in an interview earlier this summer, Yossi Weiss, chief executive officer and president of IAI, acknowledged that IAI will have to fight hard to keep Spacecom from going abroad to meet its follow-on communications satellite (Comsat) needs, just as the firm had to fight to clinch the Amos-6 deal more than three years ago.
"It’s a crisis and opportunity at the same time," said Tal Inbar, head of space programs at Israel’s Fisher Institute for Air and Space Strategic Studies. "It all depends on the strength and financial resources of Spacecom."
Inbar confirmed that if the deal with the Beijing conglomerate had gone ahead, chances were slim that the Amos-7 order would be awarded to IAI. Now, he said, it could be a different story.
"If, after Spacecom gets the insurance money, they embark on an emergency buildup for a new satellite and if – and it’s a big if – the next satellite will be ordered from IAI, this could assure continued business for the state of Israel’s Comsat sector," he said.
He added, "The big question is what will be Spacecom’s future plans. If they want to replace Amos-6 very quickly, they may opt to buy an existing satellite that is already in space."
Neither Spacecom nor IAI would comment specifically on how, if at all, Thursday’s upset would impact on the planned sale or potential follow-on orders for Israel’s satellite production firm.
In a Sept. 1 announcement, IAI noted that Amos-6 was the largest and most advanced Comsat ever built in Israel.
"We’re saddened by the loss of the satellite and stand ready to serve Spacecom… The sector of communications satellites is strategic for IAI and for the state of Israel and we hope that the state will ciontinue to act for the good of preserving the knowledge that will allow continued production of communications satellites in Israel."
Opall-Rome is Israel bureau chief for Defense News. She has been covering U.S.-Israel strategic cooperation, Mideast security and missile defense since May 1988. She lives north of Tel Aviv. Visit her website at www.opall-rome.com.