{"id":9377,"date":"2026-10-19T14:50:18","date_gmt":"2026-10-19T14:50:18","guid":{"rendered":"https:\/\/www.rbc.com\/en\/thought-leadership\/?p=9377"},"modified":"2026-10-19T15:32:21","modified_gmt":"2026-10-19T15:32:21","slug":"mission-critical-why-canadas-race-to-space-is-of-national-urgency","status":"publish","type":"post","link":"https:\/\/www.rbc.com\/en\/thought-leadership\/space-and-defence\/mission-critical-why-canadas-race-to-space-is-of-national-urgency\/","title":{"rendered":"Mission Critical: Why Canada\u2019s race to space is of national urgency"},"content":{"rendered":"\n\n\t\t\t
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\n\t\t\t\t\n\t\t\tSpace and Defence\t\t<\/a>\n\t\t\n\t\t
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\n\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\tMission Critical: Why Canada\u2019s race to space is of national urgency\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t<\/h2>\n\t\t\t\n\t\t\t\t\t\t

\n\t\t\t\tCanada can capture a portion of a US$10 billion spaceport and launch market\t\t\t<\/p>\n\t\t\t\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n

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Key Findings<\/h2>\n\n\n\n

Canada has no domestic way to reach orbit, which is both an economic and national security weakness.<\/strong> The country is dependent on international spaceports to launch its satellites, severely limiting its ability to build its space industry in an era of global uncertainty, shifting alliances and need for defence deterrence.<\/p>\n\n\n\n

Canada\u2019s strong foundation in space innovation could serve as a launching pad.<\/strong> A-list space firms, three rocket-making startups, and renewed government focus on enhancing defence and space capabilities, could lay the foundation of a thriving industry.<\/p>\n\n\n\n

Canada can capture a portion of a US$10 billion spaceport and launch market.<\/strong> Our research shows that domestic and international demand between 2027-2035 supports developing a viable North American launch alternative if Canada can move quickly.<\/p>\n\n\n\n

Spaceport Nova Scotia enjoys several advantages prized by allies.<\/strong> The launch hub under construction could address the industry\u2019s growing defence and commercial needs, allowing Canada to market its launch site to countries as diverse as Luxembourg and South Korea. Canada\u2019s NATO and European Space Agency ties could help it emerge as a major space-faring nation.<\/p>\n\n\n\n

The space launch industry will require upfront funding.<\/strong> Commercial demand alone will not close the gap and federal government supportwill be needed toensure the industry takes off. Federal support and military demand will also be needed to support the risky nature of space launches. Rockets cost hundreds of millions to build and launch, and of 216 small-launch programs tracked worldwide in 2025, only 37 had attempted orbital launch and 17 were operational.<\/p>\n<\/div>\n<\/section>\n\n\n\n

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The next big economic race is going to be in space. And it\u2019s not just about sending astronauts to Mars. Many of the ambitions are for life on earth: satellites in low-Earth orbit for communications and data analytics for scores of industries that, combined with the backbone infrastructure, would triple the global space economy to a $1.8 trillion behemoth by 2035.1<\/a><\/sup><\/p>\n\n\n\n

But it starts with launching rockets. And Canada stumbles on that first hurdle, with no domestic way to reach orbit<\/p>\n\n\n\n

That is a major national security weakness, not just an economic threat. Canada\u2019s military relies on satellites for surveillance, intelligence and operations. Adversaries have built weapons designed to disable satellites, and if Canadian assets were lost in a crisis, Ottawa would have to queue for space on foreign rockets and be beholden to their schedules in order to replace them. These satellites perform critical functions. For example, the RADARSAT Constellation Mission images Canada\u2019s Arctic up to four times a day, detects ships that aren\u2019t broadcasting their location, provides the data that guides vessels through Canadian waters and helps map floods and wildfires for emergency responders. All 27 Canadian satellites launched since September 2025 have hitched a ride on a SpaceX rocket from American launch pads, as did the three RADARSAT Constellation Mission satellites in 2019.2<\/a><\/sup> The problem is that SpaceX has stopped taking new Falcon 9 bookings beyond late 2028.3<\/a><\/sup><\/p>\n\n\n\n

Canada now faces two challenges. The country needs to find an allied alternative that can launch Canadian satellites to orbit while it also develops domestic launch capability that preserves autonomy and sovereignty.

The good news is thatCanada has a strong pedigree in space innovation. The Canadarm project and collaboration with NASA over decades has spawned a formidable industry, with A-list space firms including MDA Space, Telesat and Kepler Communications, among others. Ottawa has also buttressed that effort with a $105-million program to develop Canadian launch vehicles, a 10-year agreement for launch infrastructure in Nova Scotia, new space agreements with European allies and membership in NATO\u2019s STARLIFT launch network.<\/p>\n\n\n\n

But Canada needs to act fast, as launch decisions for the 2030s are being made now. Telesat, MDA Space and Kepler Communications have launch secured for about 300 satellites, almost all on SpaceX\u2019s Falcon 9. But another 129 satellites planned between now and 2035, and representing approximately US$290 million in launch contracts, don\u2019t have a launch booked.4<\/a><\/sup><\/p>\n\n\n\n

Adding to that is robust government demand expected on the horizon. How Ottawa handles launch in its upcoming military contracts will determine the progress of Canadian rocket developers, and partnerships with allied launch providers.<\/p>\n\n\n\n

The Canadian Armed Forces plan to accelerate most of a $26 billion space investment program that was originally spread over 20 years, for which it will need rockets that can transport large payloads and launch frequently. Without sovereign launch capability, those satellites will be competing for scarce slots on foreign rockets.<\/p>\n<\/div>\n<\/section>\n\n\n\n

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North Star: Canada\u2019s US$10-billion space opportunity<\/h2>\n\n\n\n

The value of all orbital launches in 2025 reached US$19 billion, up a third in a year.5<\/a><\/sup> Global launch value could total an estimated US$265 billion between 2027 and 2035.6<\/a><\/sup> Little of that market, however, is open for competition, as China, Russia and other major space nations launch their own satellites from a home base and most governments currently fly missions on national rockets.<\/p>\n\n\n\n

There is, however, at least a US$10-billion market that the Canadian launch industry can compete for between 2027 and 2035, as operators from Luxembourg and France to South Korea and Japan look to launch satellites into space for commercial and scientific purposes, as well as for defence.<\/p>\n\n\n\n

That figure is conservative as it extrapolates from 2025 data and only accounts for government satellites securing slots internationally, as Spain, Luxembourg and South Korea did in 2025. It also includes commercial demand that to date has relied on Falcon 9 launches, but excludes the government markets of the United States, China, Europe, Japan and India, which mostly fly on their own rockets.7<\/a><\/sup><\/p>\n\n\n\n

However, some of those markets are running short of rockets.

The European Union expects its governmental missions to exceed planned Ariane 6 and Vega C rocket supply by 2030\u201331, and the European Commissioner for Defence and Space has warned of a shortage of launchers by around 2030.8<\/a><\/sup>

A made-in-Canada launch option could boost the domestic satellite industry and facilitate the launch of assets on short notice from allies. Rocket size matters, too. Canada\u2019s military has targeted sovereign launch for 2028, but only for a small rocket with a payload of 200 kg. Small rockets carried only 4% of all satellites launched in 2025, with the rest flying on larger Falcon 9s, which carry about 17 tonnes.9<\/a><\/sup> Satellites light enough to hitch a ride on a 200 kg rocket make up about a quarter of Canada’s planned satellites but are less than 2% of the total mass. So, while a small launcher meets the military’s need for a quick-response vehicle, a spaceport requires the launch of medium-lift rockets\u2014capable of carrying a tonne or more\u2014to sustain itself.<\/p>\n\n\n\n

The demand may be coming: the medium-Earth-orbit component of the Arctic communications program, the Defence Enhanced Surveillance (which will succeed RADARSAT for military use) and the Surveillance of Space 2 project, could all add Canadian military satellites that based on comparable systems could require 10 to 25 tonnes of payload by 2035 on medium or heavy rockets.10<\/a><\/sup><\/p>\n\n\n\n

Canada\u2019s domestic launch developers are increasingly converging on this opportunity with medium-lift capabilities, albeit through different development strategies, timelines and capital requirements.<\/p>\n\n\n\n

\"Small<\/figure>\n\n\n\n

Capturing even a small share of the market would be significant. If a Canadian small rocket reaches orbit in 2029 and grows to six launches a year and a medium-lift rocket debuts in 2033 and flies four times by 2035, it would add up to 31 launches, worth a total of more than US$400 million. That\u2019s about 4% of the total addressable market (TAM), and about US$150 million a year by 2035 (roughly a tenth of the projected TAM that year.)11<\/a><\/sup><\/p>\n\n\n\n

Canada’s first foreign launch revenue will likely come through its spaceport in Nova Scotia by 2028. Germany’s Isar Aerospace signed a 10-year agreement in July 2026 to fly its Spectrum rocket from Spaceport Nova Scotia from 2028, and U.S. operator SEOPS recently booked five Spectrum launches for 2028\u20132030 from Norway and Nova Scotia.<\/p>\n\n\n\n

Allied defence also gives Canadian launchers an edge. Germany\u2019s defence minister noted recently that national security must not get stuck \u201cin commercial queues,\u201d and allied governments are expected to prioritize military launches over commercial ones.<\/p>\n\n\n\n

Canada also recently joined NATO\u2019s STARLIFT network, which is building allied capacity to replace satellites on short notice. A rocket flying from Canada, able to reach the polar orbits used for Arctic surveillance, would be highly competitive for these customers.<\/p>\n\n\n\n

As momentum picks up, Ottawa will need to decide how to structure the next tranche of launch spending: what payload capabilities to prioritize, which milestones to stage funding against and how to purchase launches. Defence should anchor those choices, as the most valuable part of the market and where sovereignty matters most. On average, a defence satellite costs five times more than a typical satellite to build and launch, and militaries pay for assured access. Defence is set to account for nearly half the value of satellites built and launched over the next decade but represent just 9% of satellite volume.12<\/a><\/sup><\/p>\n<\/div>\n<\/section>\n\n\n\n

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Financing Canada\u2019s launch capability<\/h2>\n\n\n\n

Given the upfront capital-intensive nature of the industry, meeting the rising government and commercial demand will require considerable financing.<\/p>\n\n\n\n

The country\u2019s three rocket developers\u2014Canada Rocket Company, NordSpace and Reaction Dynamics\u2014have raised a combined $200 million, including $8.3 million that has been conditionally awarded to each under Ottawa\u2019s Launch the North program. But that is a fraction of what it costs to bring a rocket into service. Canada Rocket Company, a Toronto-based firm set up in 2025 to develop  sovereign launch capabilities, says it needs up to US$660 million to fly its first rocket, a Falcon 9 alternative, in 2032.<\/p>\n\n\n\n

Commercial demand alone will not close that gap. Even if Canadian rockets won every launch contract for the roughly 129 Canadian satellites currently without a ride to orbit, the revenue would be US$290 million based on current prices\u2014less than half of Canada Rocket Company\u2019s target.<\/p>\n\n\n\n

Institutional investors have started to engage. The Business Development Bank of Canada (BDC) co-led Canada Rocket Company\u2019s seed round in January 2026 and Reaction Dynamics has raised approximately $51 million to date, including a Series A financing backed by Investissement Qu\u00e9bec. But early rounds still fall well short of the capital needed for an initial launch. Between development and first flight is where most ventures fail and financing matters most.<\/p>\n\n\n\n

Government support is also needed to take on the risky nature of space launches: of the 216 small-launch programs tracked worldwide in 2025, only 37 had attempted orbital launch and 17 were operational. A further 112 had been cancelled, retired or gone dormant.13<\/a><\/sup><\/p>\n\n\n\n

Customers of Canadian satellite manufacturers can supply additional demand. A Canadian rocket would potentially allow domestic companies to sell satellites and launch as a package and steer foreign customers\u2019 launches to Canadian soil.<\/p>\n\n\n\n

Government funding will need to lead the way. SpaceX, for example, received a US$1.6 billion NASA Commercial Resupply Services contract that saved the company from bankruptcy early on its journey. Texas-based Firefly Aerospace received a US$93.3 million NASA contract before its first successful orbital launch with its Alpha rocket in 2022. <\/p>\n<\/div>\n<\/section>\n\n\n\n

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What Canada offers<\/h2>\n\n\n\n