In a landmark move for Europe’s space and technology sector, Airbus, Leonardo, and Thales have signed a Memorandum of Understanding (MoU) to combine their respective space activities into a single, jointly controlled company.

The agreement, announced this week, represents one of the most ambitious industrial collaborations in Europe’s modern aerospace history — an effort to consolidate the continent’s fragmented space ecosystem and strengthen its position in a market increasingly dominated by global heavyweights such as SpaceX, Amazon, and China’s rapidly expanding state-backed programs.

Building Europe’s Strategic Autonomy in Space

The new entity aims to enhance Europe’s strategic autonomy in space — a critical domain underpinning essential infrastructure, from telecommunications and global navigation to Earth observation, exploration, and defence.

Airbus, Leonardo, and Thales plan to build a comprehensive portfolio of technologies and end-to-end solutions (excluding launchers), covering everything from satellite systems and payloads to advanced digital and service offerings. By pooling expertise and resources, the joint company will form a unified, resilient player capable of competing on the global stage and accelerating innovation in Europe’s space industry.

This strategic merger echoes broader policy goals across the European Union: securing independent access to critical technologies, supporting sovereign satellite constellations, and reducing dependence on non-European systems in areas like navigation, connectivity, and data infrastructure.

Key Details of the Agreement

Under the terms of the MoU:

• Airbus will contribute its Space Systems and Space Digital businesses from Airbus Defence and Space.
• Leonardo will contribute its Space Division, including shares in Telespazio and Thales Alenia Space.
• Thales will contribute its shares in Thales Alenia Space, Telespazio, and Thales SESO.

The new company will employ approximately 25,000 people across Europe and is expected to generate around €6.5 billion in annual revenue (pro forma for 2024), supported by an order backlog equivalent to more than three years of sales.

Ownership will be split as follows: Airbus 35%, Leonardo 32.5%, and Thales 32.5%. Governance will be shared equally among the three partners.

Five years after closing, the joint venture is projected to achieve mid-triple-digit million-euro synergies in annual operating income, while integration costs are expected to remain within industry benchmarks. The transaction is subject to regulatory approval, with operations expected to begin by 2027.

What the New Company Will Do

Beyond consolidation, the joint venture is designed to create a fully integrated European space champion—capable of delivering end-to-end solutions for commercial, institutional, and national customers.

Its mission will include:

• Developing next-generation space systems, including communication, Earth observation, and navigation satellites.
• Supporting sovereign national and European space programs, including those related to defence and security.
• Investing jointly in research and development to accelerate innovation and new technologies.
• Strengthening Europe’s position in export markets, with a focus on emerging commercial satellite services and global partnerships.

The merger is expected to bring greater industrial efficiency through shared engineering, manufacturing, and project management capabilities. It will also provide suppliers across Europe — from large contractors to small and medium-sized firms — with a more stable and predictable business landscape.

Statements from the CEOs

In a joint statement, Guillaume Faury, CEO of Airbus; Roberto Cingolani, CEO and General Manager of Leonardo; and Patrice Caine, Chairman and CEO of Thales, said:

“This proposed new company marks a pivotal milestone for Europe’s space industry. It embodies our shared vision to build a stronger and more competitive European presence in an increasingly dynamic global space market. By pooling our talent, resources, and R&D capabilities, we aim to generate growth, accelerate innovation and deliver greater value to our customers and stakeholders.”

They added that the partnership aligns with the ambitions of European governments to strengthen industrial and technological assets, ensuring autonomy in critical space domains and expanding opportunities for employees within a global, innovation-driven framework.

The Bigger Picture: Europe’s Answer to SpaceX

This alliance is widely seen as Europe’s response to the rise of U.S. and Chinese dominance in space. SpaceX, through its Starlink constellation, has revolutionized the satellite communications market—offering high-speed internet worldwide and reshaping expectations for cost, scalability, and service delivery.

Europe’s approach has historically been fragmented, with multiple mid-sized players operating under national priorities. The Airbus-Leonardo-Thales merger aims to change that by creating a company with the scale, funding, and cross-border cooperation needed to compete with American and Chinese counterparts.

Analysts from Reuters and Le Monde note that this industrial consolidation could serve as a “European counterweight” to SpaceX and Amazon’s Project Kuiper, both of which are building vast constellations in low-Earth orbit (LEO) to deliver global connectivity. The new European entity, with its combined technical expertise and financial strength, could help accelerate similar sovereign initiatives—including secure governmental communications, climate observation systems, and commercial connectivity networks.

Challenges and Next Steps

Still, the road to integration is complex. Previous discussions reportedly encountered obstacles over governance, valuation, and national work-share distribution—issues that are inevitable when merging major aerospace champions from different countries.

Regulatory reviews across the EU are expected to take time, and employee consultations will follow national labor laws. If successful, however, the new company could redefine how Europe builds and manages its space infrastructure—making it more efficient, globally competitive, and technologically self-reliant.

Conclusion: A Turning Point for Europe’s Space and Connectivity Future

The Airbus-Leonardo-Thales alliance marks a turning point for Europe’s space ambitions. It reflects a long-overdue realization that Europe needs scale and integration to remain competitive in a world where space has become the backbone of communication, navigation, security, and even travel technology.

If executed well, this merger could give Europe its own version of a “space superpower”—an entity capable of developing sovereign constellations, supporting both defense and civilian applications, and driving innovation that extends far beyond orbit.

For industries that depend on seamless global connectivity—from telecommunications to aviation, maritime, IoT, and travel technology—a stronger European presence in space could mean more resilient infrastructure and diversified global options.

In short, this is not just an aerospace story. It’s a strategic move to ensure Europe has a voice—and leverage—in the next frontier of global connectivity.