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Vector Space Systems

Small rocket company plans to launch big jobs in Tucson

A mid-century brick warehouse just south of Downtown Tucson is the temporary base for a tech startup that hopes to launch a new segment of the space industry: small reusable rockets carrying micro-satellites into orbit.

Vector Space Systems, a young Tucson company that plans to put small payloads into orbit by launching hundreds of small rockets each year, is set to build a manufacturing plant at Pima County's tech park, near World View.

The company plans to hire 200 employees over three years, with an average salary of $70,000, county officials said. Vector forecasts a $290 million economic impact over five years as they build its 40-foot-tall rockets, and estimates about 90 indirect jobs will be created as a result of the expansion. The company will lease land from the county and make a capital investment of $19 million in that period, and up to $50 million over 15 years, officials said.

The county is still negotiating the terms of the lease, and specific details about the transaction weren't yet available, government officials said.

The company plans to lease 15 acres, and build a 76,000-square-foot manufacturing and admin facility, with the capability to double the manufacturing space with an additional 40,000 square feet, County Administrator Chuck Huckelberry told the Board of Supervisors in a memo Wednesday afternoon.

The county is negotiating a 15-25 year "straight market rate ground lease" for the land, Huckelberry said, "covering all of the county's development costs, with a straight-line amortization."

Founded by Jim Cantrell, who played an early role in Elon Musk's SpaceX venture, Vector bought Garvey Spacecraft Corporation in July, obtaining that company's prototypes for rockets that are considerably smaller than the 100-foot vehicles that generally carry satellites to space. John Garvey, who was also involved with SpaceX, joined Vector as chief technology officer.

For the moment, Vector shares a small warehouse home on East 16th Street with another of Cantrell's ventures, Vintage Exotics, which manufactures parts for old Ferrari, Maserati, Shelby, Corvette and other sports cars.

The company plans to begin blasting its rockets, which have been tested in a small-scale sub-orbital launch, into space with 10 to 100-pound payloads by 2018. The company plans to build the rockets in Tucson and use launch pads in Alaska and Florida, and says its systems will be much more affordable than other satellite platforms. They will also launch more frequently than more massive rockets, company representatives said, and two of the stages will be reusable. The firm already has testing and development contracts with NASA and the Defense Advanced Research Projects Agency, and a customer in a Finnish satellite company.

The company told the county it has nearly $100 million in contracts for launches signed already, with another $130 million in launches in negotiation.

The company, founded in April, has about 20 employees at its temporary Tucson headquarters. It will build a new HQ and manufacturing plant in the Pima County Aerospace, Defense and Technology Business & Research Park near Tucson International Airport. The county and the Arizona Commerce Authority are working with Vector in a public-private partnership to develop the facility. About 58 temporary construction jobs will also be generated by the project, according to an analysis commissioned by Sun Corridor. The county will assist in hiring and training Vector's expanding workforce.

The company and county had planned to announce the building plan at a press conference Thursday afternoon, but the closely held news was mistakenly leaked early by a public relations firm.

Either Vector or a third-party company will assume the lease, with the leasing party responsible for the design and construction of the building, Huckelberry said. The deal will be subject to approval by the supervisors.

Vector plans to ask the city of Tucson for incentives, but county officials said the move to the tech park isn't contingent on city backing. In addition, Vector is eligible to apply for the Commerce Authority's Qualified Facilities Tax Credit Program and the Job Training Grant Program, a spokeswoman said, without detailing how those incentives might be applied.

"While Vector's eyes are focused on the stars, our home is in Arizona because we believe in its potential as a competitive tech hub," said Cantrell in a news release.

Local and state leaders touted Vector's announcement in the release from the company.

"These locally grown aerospace companies are locating to an area acquired by the county in its effort to protect Raytheon Missile Systems from residential encroachment," said Huckelberry. "Raytheon has welcomed these fellow aerospace manufacturers and these three companies combined are creating a gravitational pull of other aerospace companies interested in locating to the park."

"Helping our local businesses grow and prosper is as important to the county's economic and job growth as attracting new companies in town, if not more so," said Sharon Bronson, chair of the county Board of Supervisors. "Our country has embarked on an exciting new era of commercial space flight, and I am immensely proud that Pima County is able to assist an imaginative local company like Vector Space Systems, which is in the vanguard of this new race to space."

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Vector is "precisely the type of innovative, 21st century company we are working to attract to Arizona through our pro-business policies, and an excellent addition to Southern Arizona's already thriving aerospace industry," said Gov. Doug Ducey.

Vector successfully tested a smaller version of its rockets July 30 in Mojave, Calif., with the launch of a 12-foot prototype with a 3D-printed injector that used what the company calls a "unique propellant combination of liquid oxygen and densified propylene." That test included a prototype payload from Finnish company Iceye.

Vector has a four-year deal to conduct 21 launches for Iceye's commercial SAR (synthetic aperture radar) satellite constellation.

The company was awarded $2.5 million from NASA and DARPA to continue developing a two-stage rocket system. The funding will back Vector's work on repurposing its technology for the XS-1 Experimental Spaceplane, a planned replacement for the space shuttle program. The unmanned craft will fly to the edge of space and launch small rockets to boost satellites to orbit.

The company's Vector-R vehicle, designed to carry micro-satellites into space, will have a carbon-fiber airframe and lightweight pressurized propulsion system, the company said.

Vector plans to launch its rockets from the Pacific Spaceport Complex - Alaska, on Kodiak Island, and Cape Canaveral Air Force Station in Florida. They will also look at possibly launching from a barge in the Pacific Ocean off California, company representatives said.

Unlike NASA's under-development 150-foot Space Launch System, or SpaceX's Falcon Heavy, Vector's rockets will be small and launch frequently, lowering the cost and increasing flexibility for startups with satellite plans.

The major carriers of satellites only fly about a dozens missions annually, with limited payloads. That leaves many who need an affordable vehicle for smaller or more experimental satellites stuck on the ground.

From Quartz:

“Nobody is paying attention to those guys—they’re still treated like toys, like second-class citizens, they don’t have a reliable way to get to orbit,” Jim Cantrell says of small satellite companies.

Cantrell is a founder of Vector Space, the company behind the Mojave Desert test. He and co-founder John Garvey are both veterans of the space business; they played a role in helping Elon Musk set up SpaceX when the company’s early staff was being recruited in those same Mojave test grounds.

Musk’s vision for disrupting space is slightly different: SpaceX is beating established rocketry firms at the lucrative work of launching enormous satellites into orbit, especially geo-stationary orbits 37,000 kilometers up, where satellites can hang over one spot on Earth. SpaceX’s next rocket, the Falcon Heavy, will be enormous (though not quite as big as SLS) and designed to take big cargo into space very efficiently.

“Geo-stationary orbit is actually real estate—you can only put so many satellites up there,” Cantrell says. “It’s like waterfront property at the beach. Everyone builds the biggest thing they can put up there. Chasing that market, putting everybody out of that business, that’s how Elon is going to fund his way to Mars. It’s kind of a brilliant strategy.”
But that’s not Cantrell’s business. He and Garvey are focused on the opportunity they see in a world where companies are building businesses around satellites that weigh less than 100 lbs.

“I’m going to dominate the small side,” Cantrell promises.

Vector will face competition, including Rocket Labs, Firefly, NanoRacks, Paul Allen’s Vulcan Aerospace and Richard Branson’s Virgin Galactic, Quartz noted.

From investment site The Motley Fool:

Vector-R targets the fast-growing market for launching very small satellites, rapidly and at low cost -- and leaves Boeing, Lockheed Martin, Airbus, and SpaceX to duke it out over the market for launching larger satellites.

***

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Experts estimate that by 2020, companies could be launching as many as 500 such "microsatellites" annually. At launch prices ranging from $250,000 per launch (CubeCab) to $1.5 million (Vector) to $10 million (Virgin Galactic), that implies an annual market size of up to $5 billion -- a market in which Vector is targeting a 12% share.

From The Space Review:

That’s a lot of companies planning a lot of launches—Firefly alone envisions doing 50 launches a year by the early 2020s—but they’re just the tip of the iceberg.

***

Vector Space expects to start launches in 2018, but unlike Firefly has no plans to develop larger vehicles. “Rather than making money by learning how to make it bigger, like everybody else seems to do, we’re truly going to stick with one size and we’re going to figure out how to launch more of them,” said CEO Jim Cantrell.

“People are literally banging our door down trying to get rockets because they’re just not enough capacity out there,” said Vector’s Cantrell. He acknowledged, though, that if and when multiple small launch vehicles enter service at the flight rates they envision, “there’s a potential there will be a lack of demand” to support all the companies.

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Vector Space Systems

Vector's prototype, near the company's temporary headquarters near Downtown.

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