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Porsche SE, the family holding company that controls Volkswagen, is investing in Munich-based rocket startup Isar Aerospace in a bid to ensure access to new space technologies.
The company joins HV Capital and Lombard Odier banking group to inject $ 75 million, bringing total second-stage funding to $ 165 million and values the group at $ 550 million.
Isar is one of several European startups trying to rival Elon Musk’s SpaceX and Jeff Bezos’s Blue Origin with low-cost satellite launch services to low Earth orbit.
“We are convinced that flexible and cost-effective access to space will be a key driver for innovations in traditional industries, as well as for new and disruptive technologies and business models,” said Lutz Meschke, Porsche SE executive responsible for managing investments.
Existing investors include Airbus Ventures, Earlybird Venture Capital, and Lakestar. In total, the group has raised $ 180 million since its founding in 2018.
Isar is also ready to make life more challenging for the European launch company, Arianespace, which has been struggling with delays in its next-generation rocket, Ariane 6.
Although substantially cheaper than previous generations of Ariane rockets, the latest launch version will still be more expensive than SpaceX’s reusable rocket.
Arianespace, jointly owned by French aerospace companies Airbus and Safran, has traditionally been the preferred service provider for European space agencies.
But in May, Isar became the first private European company to win a contract from a national European space agency when it was awarded the mission to put two satellites into orbit for the German government.
Airbus, an investor in Isar since 2019, has also contracted Isar to launch an Earth observation satellite.
Isar is targeting a launch price of $ 10,000 a kilogram, still substantially higher than SpaceX.
However, Daniel Metzler, one of Isar’s three co-founders and CEO, said that compared to average European launch costs of more than $ 40,000 a kilogram for small satellites.
Isar also aims to lower prices over time as manufacturing matures and more contracts are awarded.
The rocket will have a payload capacity of up to one ton, capable of carrying multiple satellites, he said.
However, Isar has not sent a single satellite into space. The company started production of its Spectrum rocket this year and will soon begin engine testing in Sweden. The maiden flight is scheduled for summer 2022 from launch operations in Norway.
Metzler said the latest round of funding would allow Isar to increase production of the Spectrum rocket, which relies heavily on automation and 3D printing to lower production costs. The group also intended to use funds to begin development of a reusable launch vehicle.
“We want to take a leadership role in reuse in Europe,” said Metzler.
The investment from Porsche SE signaled a growing understanding that the space would transform traditional industries such as the automotive sector, he added.
“A car today is more like a device and an iPhone. They are becoming more and more software-centric, so the question is what applications can you run on your car.
“A constellation of satellites could tell you if there is a place to park, for example. The possibilities of space are very, very important drivers for the auto industry. “