by Rocket Lab (RKLB) will try to launch its first “Neutron” rocket by the end of 2024. NASA recently tapped Rocket Lab, along with 14 other companies, to help the space agency with payload integration services on sub-orbital rockets, balloons high altitude. , and orbiting spacecraft and satellites.
Peter Beck, CEO of Rocket Lab, joins Yahoo Finance to discuss the feasibility of the Neutron rocket launch timeline as well as the space sector’s profitable crossover with other industries.
Beck elaborates on the growth of the space industry and how companies like Rocket Lab are able to provide far-reaching services: “We see that businesses that normally have nothing to do with space are very dependent on it. And our opinion [is] the big successful space companies of the future will not be just a launch company or just a satellite manufacturing company because the power is strong when you combine these two elements together, space is a huge engineering compromise, if you will. So if you can combine launch systems and space systems, then you can provide services that are much better than if you’re doing it in a more traditional way. And we’ve seen more and more companies come to us and they don’t know or want the space industry, they just want a service.”
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Note to editor: This article was written by Nicholas Jacobino
Video transcript
AKIKO FUJITA: Rocket Lab shares have had a somewhat difficult start to 2024, down more than 20% so far this year. The space company is trying to make its mark on the industry with the launch of its first Neutron rocket, which it first revealed plans for in 2021. Let’s introduce Peter Beck. He is the CEO of Rocket Lab.
And Peter, it’s good to talk to you today. So much attention is being paid to this Neutron launch, which is, of course, the medium-lift rocket you want to launch by the end of the year. But I want to get your reaction to a report that came out from TechCrunch, which, by the way, is also owned by our parent company Apollo, sort of — they cite an internal conference memo that basically said Rocket Lab exaggerated . ability to be able to deliver this launch by the end of this year, saying, basically, December 15th was put as the deadline, so you could be eligible for these lucrative contracts that come through the Space Force. Wanting to get your response to that. How much credit do we have in that and how credible is the launch target, December 15?
PETER BECK: Yes. Well, thank you very much. Look, I think, clearly, we’ve got the attention of our competitors. And you know, I take that as a feather in our cap that people start throwing mud at you.
So, look, we’re working really hard to try and get the vehicle off the pad by the end of the year. I think everyone knows that. But we are also realistic that it is a launch vehicle and it is a program of launch vehicles.
And if all goes well, we’ll send it to the pad. And if we have problems along the way, we won’t. But right now we have a schedule that says we can get it to the pad. So, until that changes, we’re not waving the white flag.
AKIKO FUJITA: So let’s talk about some of those challenges in achieving. You mentioned in the latest earnings call about this new engine that will be used in Neutron. That’s, kind of, the next step, getting the test going on that.
What does that timeline look like? You mentioned the end of March maybe. Is that schedule still on track?
PETER BECK: Yes. Yes. So, you know, the engines are usually the long pole in the tent on any new launch vehicle development. We have done everything we can to try and take the stress off the engine and the engine board. So hopefully something will be on the test stand by the end of March.
And then that’s when the rubber hits the road as we see how the engine performs. And we’re kind of in that honeymoon phase right now where we’ve all got a lot of hardware coming together, you know. We have completed all of our avionics and hardware as well as much of the software and testing. So now is that time when all that hardware comes together and we see what we really have.
AKIKO FUJITA: It has been quite incredible to see the increase in commercial matters within the space sector. Rocket Lab itself wants to own that entire stock from satellite to launch. You actually already have an Electron as a hook.
Neutron, this medium-lift rocket, is next. Other offers in the works as well. What does the future of Rocket Lab look like?
PETER BECK: Yeah, no, it’s funny because everyone knows us for our Electron launch vehicle. You know, it’s the second most often launched rocket behind SpaceX. Fourth most rocket launched in the entire world, in fact. So not surprisingly, everyone knows us for our rocket program.
But actually, 2/3 of our revenue comes from our space systems division. And we have over 40 satellites and we will build some for very important national security missions like the SDA, you know, and some for commercial constellations. Then we have a space component supply merchant business that is far and wide across the entire industry. In fact, you know, 37% of everything shipped last year had the Rocket Lab logo on it somewhere.
So, as I say, we’re known for our rockets, but we pride ourselves on being a one-stop space shop. So we do everything from the initial design and supply of the components to actually building the satellites, by launching the satellites. And then just yesterday, we had an event for the MethaneSAT where we also operate that satellite for customers. So really an end to end space company.
AKIKO FUJITA: Peter, you mentioned that you have the second largest launches behind SpaceX. Last I saw – I mean SpaceX launching rockets, what, once every three days or something. If you kind of break down the annual number, what is Rocket Lab’s goal or how long until you get to that kind of frequency?
PETER BECK: Yes, so Electron will be launched this year about 22 times. So that’s a big step up from last year, which is about 10 times. So we have a rocket on the pad, sort of, every few weeks.
AKIKO FUJITA: Until now, when you look at, sort of, the breakdown of the space industry that was so much about rockets and satellite communications. We recently saw a successful re-entry of the Varda space capsule, designed, of course, by Rocket Lab. This is a capsule for those who are not following it that allows space manufacturing.
A lot of that in pharmaceuticals as well. And I wonder, when you think about the future of this industry, does it get to a point where it’s not just about being a rocket company, sort of, an aerospace company? That is to say, in other words, pharmaceuticals, health and wellness, that everyone will have to participate in it in some way because it will be at the intersection of that.
PETER BECK: Yes, absolutely. And lo and behold, we see businesses that normally have nothing to do with the space become quite dependent on it. And in our opinion, the big successful space companies of the future will not be just a launch company or just a satellite manufacturing company. Because you have tremendous power when you combine those two elements together, I mean space is a huge engineering compromise, if you will.
So if you can combine launch systems and space systems, then you can provide services that are much better than if you’re doing it in a more traditional way. And we see more and more companies coming to us and they don’t know anything about the space industry and they don’t want to. But they just want to serve us and I think that’s where it all comes down to. So the reason we’re pushing Neutron so hard is 50% of it is, look, we absolutely think there’s a need for more competition in the market in the medium launch area. And secondly, we want to provide services and having your own trip to the space or space keys is essential.
AKIKO FUJITA: Peter Beck, CEO of Rocket Lab, is always happy to talk to you. We really appreciate you being with us today.
PETER BECK: Do not mention it. Thank you.
