Advancing UK Aerospace, Defence, Security & Space Solutions Worldwide
  • Home
  • /
  • Space
  • /
  • UK's space sector expands faster than its economy

Space

UK's space sector expands faster than its economy

The UK space sector is expanding faster than the overall UK economy, contributing over £17.5 billion annually, employing more than 45,000 people and supporting £360 billion in economic activity through satellite infrastructure.

Image courtesy Heligan Group

According to Heligan Group, M&A activity across the sector has rocketed over the past decade from only five transactions in 2013 to 27 in 2023 and will continue to grow in 2025 due to increasing government funding, the falling cost of launches and the adoption of new technologies, such as satellite-based quantum key distribution technology.

Advertisement
ODU RT

 
Simon Heath (above), Partner at Heligan Group, said: “Advances in technology such as reusable rockets, orbital refuelling, and in-space manufacturing via 3D printing are driving the wave of innovation in the space sector. A prominent development for the UK is the growth of small satellite technologies, which are revolutionising the space industry by providing cost-effective and accessible satellite services.”
 
UK SMEs are playing a transformative role in the global space industry, specialising in satellite components, propulsion systems, and space data analytics, with many outpacing larger firms by focusing on niche technologies. Many are hopeful that a Space X-scale company will emerge from the UK over the next decade with the rising risk of SMEs being acquired by larger integrators.
 
Simon said: “Most UK space SMEs operate outside traditional aerospace hubs, decentralising the industry and fostering innovation across the country; this broader talent base is crucial for the long-term competitiveness of the UK space industry. With this, SMEs face growing challenges, including a reliance on large upfront investments, investors remaining cautious due to long timelines, and government funds becoming increasingly competitive.”
 
Access to growth finance and investment in the UK space sector has seen improvement in recent years but remains a mixed landscape. Nevertheless, trends indicate increasing interest from venture capitalists and corporate investors. Corporate venture arms of major aerospace and defence organisations such as Airbus and BAE Systems are actively investing in innovative space technologies. The UK government has also remained a key player, offering funds and grants through The UK Space Agency and Innovate UK.
Advertisement
ODU RT

 
Simon added: “Over the next 24 months, we will see a variety of themes driving activity in the UK space sector. Space infrastructure investment will be a primary concern as strengthening the UK’s space resilience is a national security priority. There will also be consolidation, with the market being highly fragmented and full of young, IP-rich and fast-growing businesses. Lastly, technological advancements such as innovations in small satellite systems and reusable launch vehicles are lowering entry barriers, reducing investment risks, and creating new opportunities for space startups.
 
“It is exciting to see the UK position itself to become a leading force in the global space economy. Although it currently lags behind other nations in space launch capacity, this will change with multiple launches planned from UK soil in 2025, with UK SMEs playing a bigger role than ever. Rapid technological advancements and escalating geopolitical tensions have intensified reliance on private sector innovation, with sovereignty playing an important role in supply change.
 
“While the space sector is growing, it is a typically cash-hungry industry with profitability for many of the UK’s brightest companies still several years away. However, the space sector is one area where the UK government is highly supportive, and this is mirrored in the private sector, with several VC investors solely focusing on frontier technologies. 2025 will be an interesting year for the UK space sector as interest from venture capitalists and corporate investors continues to grow."
 
Based in the UK with offices in London and Birmingham, Heligan Group is an intelligence led investment and advisory group specialising in partnering with businesses that contribute to global safety and security.

Advertisement
Babcock LB
Aurora Avionics secures funding to advance space launch tech

Space

Aurora Avionics secures funding to advance space launch tech

1 April 2025

Aerospace technology firm Aurora Avionics has secured a £500,000 investment to accelerate its mission of revolutionising space launch guidance systems.

Leonardo’s PRS receiver certified for defence and emergencies across Europe

Defence Security Space

Leonardo’s PRS receiver certified for defence and emergencies across Europe

1 April 2025

Leonardo has designed, developed and built the only receiver specifically conceived for the ultra-secure Public Regulated Service (PRS) - provided by the Galileo satellite navigation service - which is currently accredited for use throughout Europe.

SonoChem System wins UK Space Agency’s Aqualunar Challenge

Space

SonoChem System wins UK Space Agency’s Aqualunar Challenge

28 March 2025

A transformational technology that uses microwaves to defrost and ultrasound to break down contaminants in melted lunar ice to provide clean, drinkable water for astronauts - SonoChem System by Naicker Scientific - has won the UK Space Agency-funded Aqualunar Challenge.

Saxavord Spaceport partners with West of Scotland Space Cluster

Space

Saxavord Spaceport partners with West of Scotland Space Cluster

27 March 2025

SaxaVord Spaceport, the UK’s first fully licensed vertical launch spaceport and the West of Scotland Space Cluster, the UK’s newest regional space cluster, have announced a strategic partnership aimed at advancing Scotland’s position as a global leader in space exploration and technology.

Advertisement
ODU RT
Cranfield Alumni win two British Council Study UK Alumni Awards

Security Space Events

Cranfield Alumni win two British Council Study UK Alumni Awards

26 March 2025

Cranfield Alumni Debora Comparin and Dr Raúl González Muñoz were named as winners in the 2025 British Council Study UK Alumni Awards for France at a ceremony in Paris on 13th March.

ADS appoints Kata Escott as Vice President for Space

Space

ADS appoints Kata Escott as Vice President for Space

21 March 2025

ADS, the UK trade association for the aerospace, defence, security and space, has announced the appointment of Kata Escott, UK Managing Director and Head of Country at Airbus Defence and Space, as its new Vice President for Space.

Advertisement
ODU RT