The Scottish firm, which along with Skyrora is one of two developing rockets for anticipated future launches from British soil, announced its formal closure in a post on LinkedIn yesterday evening (18 February), a week after it began the process of appointing administrators.
Signing off with the hashtag #SpaceIsHard, the developer of the Prime microlauncher wrote: “It’s not the conclusion we hoped for, but we remain incredibly proud of everything we accomplished together at Orbex – the milestones we reached, the challenges we overcame, and the ambition we poured into every step of this journey.”
The closure means the loss of 163 space industry jobs in the UK. The company has donated engine chambers to the Science Museum in London and National Museums Scotland in Edinburgh.
The end of Orbex is “sad news”, Dr Bleddyn Bowen, associate professor of astropolitics and co-director of the Space Research Centre at Durham University, told Professional Engineering. “When a business goes under, it’s always terrible for the people in it.”
But, he continued, “it’s not a huge surprise, really – I didn’t know when it would happen, but it’s not a surprise that yet another setback for the UK’s stated desire to develop UK launch from UK soil [has happened]… because the UK government has not committed itself to being an ‘anchor customer’ for such launch services.
“If there was enough private demand to guarantee the return on the cost of developing these small launches with the kinds of launch profile you’d get from northern Scotland, then there would be investors like any other private venture. But as we’re seeing in other parts of Europe, all these small launch start-ups have to have publicly funded grants or backing to make it possibly worthwhile, because these companies can’t really survive on economic projections of future contracts – they have to have the money to develop their rockets now, which is extremely expensive stuff.”
In January 2025, the government invested £20m in Orbex to accelerate development of Prime, which had been due to launch by the end of last year. That was eventually pushed back, however, and the company entered administration before lift-off.
In recent weeks, questions have been raised over further funding that was due to be shared via the European Space Agency (ESA), with the local Forres Gazette reporting that €112m of €144m was yet to be distributed. Constituency MP Graham Leadbitter of the Scottish National Party wrote to business secretary Peter Kyle asking why the almost £100m “never materialised”, according to The National.
On Tuesday, a government spokesperson said it would be inappropriate to comment on commercial discussions, but that it had allocated Orbex the maximum amount possible at the ESA Council of Ministers in November last year. The company needed to secure a matched level of private investment, which it was unable to do.
Regardless of funding, Bowen said “you’ve always needed the promise of government contracts to make a launcher worth it”.
The lack of launch demand was also highlighted by Martin Heywood, director of consultancy and testing services provider Newton Launch Systems, as a key reason for the demise of Orbex. “The business case for a small launcher has always been poor (the reason that SpaceX abandoned Falcon 1), but it’s worse for a UK-based launcher for a few reasons,” he told Professional Engineering.
These include at-least weekly SpaceX launches with massively reduced cost per kilogram to orbit, and the small size of the potential market. Heywood contributed to a 2017 market analysis by the British Interplanetary Society (BIS), which found that it would be sufficient for six to eight launches per year, requiring just one launcher somewhere in the UK or the EU. A repeat in 2019 reached the same conclusion.
Major developments in recent years include a significant increase in the number of satellite launches, Heywood continued, “prompting the UK Space Agency and private investors to invest heavily in launch from the UK. The headline growth is, however, misleading for a number of reasons.”
Factors include the fact that the “vast majority” of satellites launched are in constellations, launching in batches on larger vehicles from the US, to orbits not available from the UK.
“Having the government as an anchor customer (with two or three launches each year) is absolutely essential, but is nowhere near sufficient for a commercial launcher,” he continued.
Other issues for Orbex included an over-estimation of market growth (including more than 22 launches per year), he said, and readiness of the rocket technology.
The company likely struggled to raise private funding because of the amount of market competition, suggested Richard Osborne, a member of the BIS council, with “200 or so other companies claiming to be developing launch vehicles” worldwide. While Orbex led the UK field, and many of the alternatives were “just PowerPoint slides”, it created a “hostile investment climate” that directed some funds away from the main players, he told Professional Engineering.
Potential clients, meanwhile, would likely have approached launch providers that had already proven their technology and were already launching rockets.
“Orbex, realistically, were one of the only two credible orbital launch companies based in the UK… so to see one of them fall by the wayside was a real, real shame,” said Osborne, who is also chief technology officer of AstroAgency, which advises Highlands and Islands Enterprise, and who has previously worked as a programme manager at Skyrora.
The loss of so many jobs in rocket engineering is “a real blow”, he continued. “In terms of the big picture, strategically, it has less of an impact on the UK space community or the space industry than you would think.”
He added: “Remarkably, the UK space industry is flourishing… it’s had all manner of trials and tribulations over the years and it’s in good health.”
This is because the spaceports being developed, such as SaxaVord – where Orbex planned to launch from – are already dealing with a number of European launch companies, he said.
“Launch is very much the glamorous side of the industry. It’s the one that everyone sees,” he said. “But the reality is, there’s an awful lot going on behind the scenes, and from an engineering perspective you need engineers for building satellites, for testing satellites and testing launch vehicles.”
Thankfully, Durham University’s Bowen said, “the rest of the UK’s space ecosystem is not really entwined with the launch side of things, so Orbex going under is not going to stop or negatively impact all the other things going on in British universities, or satellite components manufacturers, or downstream services applications companies using satellite data… I’m not seeing a huge, huge impact outside of the launch sector itself.”
The lack of the UK government as an “anchor customer” could be a similar challenge for Skyrora, he continued, “but if they have the means to keep spending money to develop their rockets and develop a production line… to then start offering services, then they can make it”.
Professional Engineering contacted Orbex and the government for comment.
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Content published by Professional Engineering does not necessarily represent the views of the Institution of Mechanical Engineers.