The year 2025 brought seismic shifts in Europe’s space sector, with an unmatched volume of newly announced funding and security becoming a core policy rationale underpinning Europe’s public space investment.

Can the newfound promise of scale be continued and matched with speed and agility of delivery?

We identify seven main signals that will determine if Europe can make a real difference and legitimately claim its rise back up the global space power ranking:

1. An opportunity for Europe’s international leadership and partnership

While partnership with the United States remains a central goal, its future is as uncertain as ever, and other vying space powers, like Japan, South Korea and Australia increasingly seek to deepen ties with Europe. As an early sign, Canada dramatically increased its European Space Agency (ESA) subscriptions at ESA Council at Ministerial Level 2025.

What to look for in 2026:

• Will Europe be able to build a large-scale space partnership with Canada, Japan, South Korea or Australia, with concrete programmatic goals and joint political and financial backing?
• Will Europe be able to craft and own a long-term posture towards full-fledged space powers, also acknowledging cooperative endeavours underway like the exchanges on the Bharatiya Space Station with India, the Artemis programme with the United States or the SMILE mission with China?

2. A Trump Card outscaling Europe

The past year has seen the emergence of several global developments with a potential to far outscale and outspeed today’s most ambitious institutional and commercial space programmes, for example:

• • • Defence: the Golden Dome missile defence system for the United States,
    • Exploration: China’s accelerated plans for a Taikonaut landing on the Moon,
    • Commercialisation: operational introduction of Starship, SpaceX IPO discussed at a floated $800 billion valuation, and the rise of direct-to-device (D2D) as hyperscaler in consumer markets.

What to look for in 2026:

• Can European and national decision-makers anticipate new disruptors, avoid another set-back, and continue aggressively raising the bar to stop the trend of a deepening gap with the United States and China?

• Will Europe, including the European Union Multiannual Financial Framework (EU MFF), engage on the way for a European post-International Space Station human exploration programme in Low Earth Orbit and beyond, that is able to overcome today’s dependencies and create scale, placing space exploration as integral part of its ambition, along with the security & defence and commercial pillars of space power?

• Will the EU MFF 2028-2034 proposal of EUR 131 billion for defence and space withstand scrutiny and pressure, and dedicate at least 30% for the EU Space Programme? And will the EU manage to mobilise or redirect funding to space prior to the next MFF?

3. A continuing security & defence momentum

2025 saw an unprecedented European wake-up on the role of space for security & defence, a change of posture in particular in Germany and at ESA level, anchored in new announcements and programmes.

2026 will show if further stakeholders in Europe will follow, including the UK, to translate the 2025 momentum and see it grow into a new scale and timely capability development for shared benefits across the continent, also beyond national priorities.

What to look for in 2026:

• Will other European countries follow Germany’s suit and outscale their civil space budgets with defence expenditures for space?

• Will European states fully leverage pragmatic security & defence mechanisms through federated efforts of ESA’s European Resilience from Space (ERS) programme, the EU Space Programme and European Defence Agency (EDA)?

• Will the implementation of Germany’s EUR 35 billion investment in space for security and defence, and of the 2025 French Space Strategy, emerge as central pillars to revitalise Europe’s space, defence and digital industries, innovative power and workforce?

4. Pragmatic models of European cooperation

With more European nations investing nationally, it remains key to strike a balance between national ambition and shared European objectives, through reinforcing a whole-of-Europe approach leveraging national programmes, flexible intergovernmental mechanisms and the EU Space Programme.

What to look for in 2026:

• Will there be alignment between proliferating national assets, e.g. by pooling and sharing infrastructure, services, data and information at multi-lateral and European level or by developing interoperability within a federation of distinct systems?
• Will there be stronger embedding of the industrial and strategic assets of the UK, Norway, and Switzerland, as their defence, commercial and innovation capabilities are essential elements of the European fabric?

5. A new European industrial vision for space

With the proposed BROMO consolidation between Airbus, Thales and Leonardo underway, satellite operators receiving new political attention, new industrial alliances forming (e.g. between Rheinmetall and ICEYE, or KONGSBERG, Helsing, Isar Aerospace and Hensoldt), and the IRIS² implementation through a Public-Private Partnership put to the test, 2026 provides an ideal opportunity for the full European industrial value chain to develop its own vision for space, driven by a new level of ambition for increased innovation, disruption and acceptance of higher market risk.

What to look for in 2026:

• Will we see a wider wave of mergers and acquisitions activity given the increasing competition between maturing startups and a reinvigorated interest of large defence contractors and digital giants?

• Will Europe be able to protect its crown jewels from foreign takeovers, providing the right environment and trust to scale domestically?

• Will rising companies from non-traditional centres of corporate space power (e.g. Poland, Hungary, Finland) scale and embed themselves into Europe’s industrial policy discourse?

6. Digital Space as a transformative economic driver

The value of space as a public good in the wider economy continues to be under accounted for in Europe, preventing fiscal justifications for further investment.

At the same time, U.S. Big Tech (i.e. Google, Amazon, SpaceX) and China are increasingly betting on space as one of the economic drivers for the future, primarily with communications, and potentially in-space compute and networking (e.g. data centres, optical and quantum comms).

What to look for in 2026:

• Will the security and defence priorities, and increasingly corporatised value chains, weaken the availability of data and tighten historically relaxed data policies for accessing space-based data?
• Will there be moves of public or private interest in Europe to finance large-scale cutting-edge infrastructure (e.g. D2D) or innovation (e.g. space-based data centres) that could rewrite the business playbook of the space sector?

7. Finding Europe’s North Star

What marked a year of new ambitions in different parts across Europe in 2025, now requires a shared vision of Europe’s space power posture of the future in 2026 – a distinct narrative of WHY space is critical for Europe’s future, transcending alignment with other great powers and enabling truly autonomous decision-making.

This comes down to developing a deep conviction across European political and industrial decision makers as well as in civil society that space “substantially contributes to the continent’s strength, security, and prosperity” and treating space as integral part of foreign, defence, digital and other sectorial policies.

What to look for in 2026:

• Will leading European nations, ESA and the European Union find a leadership to outline Europe’s common vision for space, to come a step closer to communicating and developing the transformative value of space across its economic, security, and societal dimensions?

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Conclusion

2026 holds many challenges. Yet, three most time-critical challenges require European political and industrial decision-makers to come together in 2026 – beyond their traditional institutional frameworks – in a yet to be defined forum, to urgently address the most critical issues:

• Agree on measures to foster the federation of national and European space developments, in particular for security & defence, to maximise timely delivery and shared benefits for peace across the continent.
• Define a shared international strategy to develop a leading role for Europe on the global stage, enacted through its different channels, with new large-scale partnerships and posture towards other space powers.
• Defining Europe’s own ambition, including at EU level in the geo-political race for the Moon, beyond the role of a junior partner to foreign initiatives.