Lockheed Martin buys up to 58 launches over the next decade from rocket builder ABL Space

Investing News

An RS1 rocket booster undergoes acceptance testing.
ABL Space

Rocket builder ABL Space signed a long-term agreement for multiple launches with Lockheed Martin, agreeing to provide the defense giant with as many as 58 rockets through the end of the decade.

Lockheed Martin will buy up to 26 of ABL’s RS1 rockets through 2025, with an option for up to 32 additional launches through 2029, ABL announced on Monday.

“Having this assured access to space will accelerate our ability to demonstrate the spacecraft and associated payload technologies we are developing to the meet the future mission needs for our customers,” Lockheed Martin Space executive vice president Rick Ambrose said in a press release.

ABL’s RS1 rocket fits in the middle of the launch marketplace, between Rocket Lab’s small Electron and SpaceX’s large Falcon 9 vehicle. RS1 is nearly 90 feet tall and is designed to launch as much as 1,350 kg (nearly 1½ tons) of payload to low Earth orbit.

Lockheed Martin’s venture arm is one of ABL’s early investors, with the company having raised about $220 million in private capital so far – the majority of which came in a round from T. Rowe Price and Fidelity Management last month at a $1.3 billion valuation.

ABL declined to comment on the financial terms of the contract. Based on ABL’s $12 million price tag for an RS1 rocket, the deal with Lockheed Martin is estimated to be worth nearly $700 million over eight years, assuming the maximum number of launches.

A fully-integrated RS1 second stage in test firing at Edwards Air Force Base in 2020.
ABL Space

Notably, as ABL’s rockets utilize a mobile ground system called GS0 that can pack into a few shipping containers, Lockheed Martin may use a variety of launch facilities around the world – including U.S. Space Force facilities at Vandenberg in California and Cape Canaveral in Florida.

While the defense giant did not specify which missions it plans to launch with ABL’s rockets, Lockheed Martin previously announced in February that it had selected ABL to launch a mission from Scotland in 2022. Additionally, Lockheed Martin last month signed a strategic partnership with satellite start-up Omnispace, with the latter company planning to launch a constellation of satellites to build a 5G communications network in space.

The large contract represents a coup for ABL in the medium-lift segment of the launch market, where the company is competing with Richard Branson’s Virgin Orbit, which reached orbit a few months ago.

Other competitors in that arena include Relativity Space and Firefly Aerospace, which are aiming to launch for the first time later this year. Meanwhile, Rocket Lab is developing a medium-lift rocket called Neutron that it expects to launch by 2024.

ABL continues to work toward its inaugural RS1 launch from Vandenberg.

While ABL had previously hoped to be ready to launch as early as March, president Dan Piemont said that the company is now aiming “for flight readiness by June.” The rocket builder recently finished acceptance testing on the first RS1 fuel tank, but Piemont said ABL expects the required launch site regulatory approvals will delay its first launch attempt to the third quarter of this year.

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