Space Industry Cheat Sheet: Dream Chaser Pivots to Defense as China Flexes Orbital Muscles

Team, here with your week­ly space indus­try roundup. This past week brought about sig­nif­i­cant shifts in the com­mer­cial space land­scape, from Sier­ra Space’s sur­pris­ing piv­ot away from ISS mis­sions to Chi­na’s increas­ing­ly bold demon­stra­tions of space sur­veil­lance capa­bil­i­ties. Let’s dive into what’s been hap­pen­ing above our heads.

Dream Chaser Changes Course

In what I’d call the week’s biggest strate­gic shift, Sier­ra Space announced it’s no longer plan­ning to send its Dream Chas­er space­plane to the Inter­na­tion­al Space Sta­tion for car­go runs. Instead, they’re piv­ot­ing hard toward nation­al secu­ri­ty mis­sions. NASA and Sier­ra Space have mod­i­fied their Com­mer­cial Resup­ply Ser­vices 2 con­tract, orig­i­nal­ly signed in 2016, which includ­ed sev­en car­go mis­sions to the ISS.

Now, Dream Chas­er will con­duct a sin­gle test flight in late 2026, which will not dock with the Inter­na­tion­al Space Sta­tion. How­ev­er, NASA retains the option to order car­go mis­sions at a lat­er time. What’s par­tic­u­lar­ly inter­est­ing here is that Sier­ra Space has­n’t dis­closed any spe­cif­ic tech­ni­cal issues caus­ing the delays — the vehi­cle was orig­i­nal­ly sup­posed to fly last year. This piv­ot to defense appli­ca­tions sug­gests they see more lucra­tive oppor­tu­ni­ties in the mil­i­tary space sec­tor, which aligns with the broad­er indus­try trend we’ve been tracking.

The Space Surveillance Chess Match Heats Up

The space domain aware­ness game between the U.S. and Chi­na took some fas­ci­nat­ing turns this week. Chi­nese com­pa­ny Chang­guang Satel­lite Tech­nol­o­gy pub­lished images of Maxar’s World­view Legion 2 satel­lite, tak­en by their Jilin‑1 space­craft from a dis­tance of 40–55 kilo­me­ters. This appears to be a direct response to Maxar’s pub­li­ca­tion of images of Chi­na’s Shi­jian-26 exper­i­men­tal satel­lite in July.

But it did­n’t stop there. Chi­na’s Shiyan-12 (02) inspec­tor satel­lite maneu­vered with­in 60 kilo­me­ters of a U.S. Space-Based Infrared Sys­tem (SBIRS) mis­sile warn­ing satel­lite ear­li­er this month, posi­tion­ing itself for opti­mal imag­ing. These tit-for-tat demon­stra­tions show­case both nations’ grow­ing capa­bil­i­ties in what I refer to as “orbital recon­nais­sance.” Frankly, it’s a trend that’s only going to intensify.

Space Force Doubles Down on Speed and Flexibility

At the Air & Space Forces Asso­ci­a­tion con­fer­ence, Chief of Space Oper­a­tions Gen. Chance Saltz­man deliv­ered some hard truths about acqui­si­tion reform. His mes­sage was clear: the Space Force needs to pri­or­i­tize speed over per­fec­tion when acquir­ing new sys­tems. With Chi­na rapid­ly advanc­ing its space war­fare capa­bil­i­ties, includ­ing its push toward reusable launch vehi­cles, Saltz­man empha­sized the need to accept “imper­fect solu­tions that can help troops today rather than wait­ing for flaw­less systems.”

The Space Force also announced that its next-gen­er­a­tion space domain aware­ness satel­lites (the RG-XX pro­gram) will be equipped for on-orbit refueling—a first for an offi­cial acqui­si­tion pro­gram. By allow­ing its space domain aware­ness satel­lites to refu­el, it enables satel­lites to maneu­ver more freely with­out wor­ry­ing about fuel con­straints (think of this as a refu­el­ing tanker refu­el­ing a fight­er jet while on a mis­sion). The Space Force is tar­get­ing an RFP by the end of the year, with mul­ti­ple ven­dors expect­ed to compete.

Commercial Space Momentum Continues

The invest­ment cycle remains hot, with sev­er­al sig­nif­i­cant developments:

Plan­et Labs con­tin­ues to prove that space busi­ness­es can gen­er­ate cash flow, post­ing their sec­ond straight quar­ter of pos­i­tive free cash flow. Their stock is up 205% year-to-date, dri­ven by a 20% year-over-year rev­enue increase and a mas­sive 245% surge in back­log to $736 mil­lion. The geopo­lit­i­cal uncer­tain­ty is clear­ly dri­ving demand for Earth obser­va­tion capabilities.

Star­lab Space took a major step for­ward, select­ing Vivace Corp. to man­u­fac­ture the pri­ma­ry struc­ture of its com­mer­cial space sta­tion at NASA’s Michoud Assem­bly Facil­i­ty in New Orleans. With an 8‑meter diam­e­ter (just shy of SLS’s core stage), Star­lab is bet­ting big — lit­er­al­ly — on pro­vid­ing 40% of the ISS’s pres­sur­ized vol­ume when it launch­es in 2029.

Fire­fly Aero­space earned an extra $10 mil­lion from NASA for deliv­er­ing addi­tion­al data from their Blue Ghost lunar mis­sion, includ­ing the first HD images of a solar eclipse from the lunar sur­face. They col­lect­ed near­ly 120 giga­bytes of data and sur­vived tem­per­a­ture swings from 230°F to ‑275°F dur­ing a solar eclipse.

Launch Updates and Technical Achievements

SpaceX main­tained its relent­less launch cadence, com­plet­ing three launch­es in just 41 hours — includ­ing a NASA sci­ence mis­sion car­ry­ing IMAP, the Car­ruthers Geo­coro­na Obser­va­to­ry, and NOAA’s Space Weath­er Fol­low On L1 mis­sion to the Earth-Sun L1 Lagrange point.

Blue Ori­gin remains the sole bid­der for NASA’s VIPER lunar rover deliv­ery, secur­ing a $190 mil­lion task order to land it at the Moon’s south pole in late 2027. The lack of com­pe­ti­tion here is note­wor­thy, sug­gest­ing that either tech­ni­cal chal­lenges or busi­ness case con­cerns are deter­ring oth­er providers from enter­ing the market.

Looking Ahead

The Artemis 2 mis­sion could launch as ear­ly as Feb­ru­ary 5, 2026, with the crew nam­ing their Ori­on space­craft “Integri­ty.” NASA’s mak­ing sol­id progress on prelaunch prepa­ra­tions, although the Aero­space Safe­ty Advi­so­ry Pan­el warned that SpaceX’s Star­ship lunar lan­der for Artemis 3 could be “years late” based on their recent vis­it to Starbase.

Ger­many announced a mas­sive 35 bil­lion euro ($41 B) invest­ment in mil­i­tary space sys­tems through 2030, cit­ing threats from Chi­na and Rus­sia. Ger­many’s invest­ment rep­re­sents one of the largest nation­al space defense invest­ments we’ve seen from a U.S. ally.

The Bottom Line

This week rein­forced sev­er­al key themes I’ve been track­ing: the mil­i­ta­riza­tion of com­mer­cial space capa­bil­i­ties, the inten­si­fy­ing com­pe­ti­tion between the U.S. and Chi­na in space domain aware­ness, and the con­tin­ued mat­u­ra­tion of the com­mer­cial space econ­o­my. Sier­ra Space’s piv­ot to defense, com­bined with the Space Force’s push for speed and flex­i­bil­i­ty, shows how nation­al secu­ri­ty con­cerns are reshap­ing the industry.

The space sur­veil­lance demon­stra­tions between the U.S. and Chi­na are par­tic­u­lar­ly con­cern­ing from a sta­bil­i­ty per­spec­tive. As both nations devel­op increas­ing­ly sophis­ti­cat­ed inspec­tion and imag­ing capa­bil­i­ties, we’re enter­ing an era where every satel­lite is poten­tial­ly under obser­va­tion. Chi­na treats its com­mer­cial base as part of its defense indus­tri­al base, while the U.S. still views it as a part­ner. The U.S. must return to a day when both are one and the same to give mil­i­tary plan­ners more options.

Mean­while, the com­mer­cial sec­tor con­tin­ues to mature, with com­pa­nies like Plan­et Labs prov­ing that sus­tain­able space busi­ness­es are pos­si­ble, even if they take 15 years to achieve prof­itabil­i­ty. The hot invest­ment cycle shows no signs of cool­ing, espe­cial­ly for com­pa­nies address­ing defense and intel­li­gence needs.

As we head into Octo­ber, keep an eye on the Space Force’s RG-XX pro­gram RFP and any respons­es to Ger­many’s mas­sive space defense invest­ment. The inter­sec­tion of com­mer­cial inno­va­tion and nation­al secu­ri­ty require­ments will con­tin­ue dri­ving the indus­try forward.

Stay tuned for next week’s update, and as always, keep look­ing up!

September 29, 2025

Posted in Space.