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Space is back. Innovation and geopolitics have built new momentum for the space industry after the decades of uninterest and budget cuts that followed the space race of the Cold War. 

More importantly, the industry has changed its skin. It used to be dominated by state-sponsored initiatives. But the space business generated by commercial contracts, particularly in telecommunications, was 64% higher than the business generated by state-sponsored initiatives in 2023, according to figures from consultancy firm McKinsey. 

This shift is driving growth, innovation and investment into the space economy. Overall, McKinsey forecasts the space economy will be worth $1.8tn by 2035 (accounting for inflation), up from $630bn in 2023. 

Just a few hubs the world over hold the technical knowledge, the capital and the companies to serve an industry that is typically characterised by cutting-edge technology and low volumes. Piemonte is one of them, and the region is doubling down on efforts to leverage its fast-growing space cluster and take it to its next dimension. 

“All things being equal, if these forecasts hold true, as a cluster we can overcome the regional automotive industry if not in terms of workforce, at least in terms of revenues,” says Walter Cugno, Thales Alenia Space’s (Tas’) vice president for exploration and science, and head of the Turin site. 

Space growth 

Piemonte’s space cluster is the crown jewel of a regional aerospace industry that has been growing steadily over the past few years. The latest figures from the regional government talk about an annual value of production of €8bn, 35,000 employees and more than 450 small and medium-sized enterprises (SMEs) working in the value chain. 

The top of the sectoral pyramid features the local operations of space contractors Tas and Aerospace Logistics Technology Engineering Company, defence firm Leonardo, and aerospace firms Avio Aero and Safran. Fast-growing satellite firms like Argotec and Tyvak are also increasing their gravitational pull on the ecosystem. 

Largely tracing back to the competencies in aviation developed by Fiat, Piemonte’s space cluster has come a long way since its first collaborations in the 1970s with Nasa and the European Space Agency (ESA). 

Today, Turin is the base of the science and exploration activities of Tas Italia. It has produced around 50% of the habitable volume of the International Space Station in orbit 400km from Earth, and is producing the cargo capsules that supply it. It is also working on two pressurised modules for Axiom Space’s first-ever commercial space station. 

But Tas is looking beyond Earth’s orbit. It’s a top-tier contractor for the Lunar Gateway, which is part of Nasa’s Artemis programme to send astronauts back to the Moon, and is taking a lead on the delivery of a few key components of the ESA’s ExoMars mission, such as the entry, descent and landing modules. 

With regards to science missions, Tas Italia was the prime contractor for the Euclid ESA mission that sent a wide-angle space telescope to a Sun–Earth lagrangian point — an area where the gravitational pull from both bodies is balanced out, 1.5m km from Earth — in July 2023. 

“Over the past few years we have experienced steady growth,” Mr Cugno says, noting that Piemonte accounts for half of the €1bn in revenues that Tas Italia expects to generate in 2024. The company has increased its total Italian headcount to around 3000, thanks to the boost some of its programmes received from the Italian recovery plan. 

Satellite sensation

With communications driving the new commercial space age, Turin is proving fertile ground for producers of small satellites solutions, such as Tyvak, a local producer of small satellites owned by US aerospace company Terran Orbital, which has recently launched Iperdrone.0, a ‘drone satellite’ developed for the Italian Space Agency (ASI) that can perform in-orbit servicing activities before re-entering the atmosphere and landing back on Earth. 

Another example would be Argotec, a local company producing small satellites for both low Earth orbit and deep space, as well as goods and services to enhance and improve the experience of astronauts in space. 

Argotec produced and controlled the Light Italian CubeSat for Imaging of Asteroids, or LiciaCube, which participated in Nasa’s Double Asteroid Redirection Test to capture images 11 million km from Earth and send them back to the company’s control centre. It is now working on a constellation of satellites to equip the Moon with a highly efficient communication system, and is targeting Mars for its next cutting-edge constellation. It is also a contractor, alongside Tas, with ESA and ASI for IRIDE, a satellite constellation for Earth observation. 

The company, which remains 100% owned by founder and CEO David Avino, saw revenues double to €50m over the past three years, with a 2023 earnings before interest, taxes, depreciation and amortisation margin of 16%. It expects this growth trajectory to continue in the foreseeable future and has launched a campaign to raise €150m and possibly get to a public listing, Mr Avino confirms. Additionally, it has just invested €25m in a new site in the outskirts of Turin which will function as the company’s Italian base hosting the majority of the company’s 200 employees, with another 100 joining soon, he notes. 

“This is a game-changer for us,” he says, adding that the new site, designed by Brazilian architect Oscar Niemeyer in the late 1970s, has 12,000 sq m of space, with the possibility of expanding it futher. 

Ecosystem and transformation 

Argotec’s new site will not only host the company’s operation, research and development and production facilities. It will also become a space park to accelerate space companies in its value chain. The programme is already accelerating one start-up developing satellite mechanisms and power systems, Revolv Space, whose team moved from the Netherlands to Turin to join the programme. 

The park adds to a space tech ecosystem in Turin that already sees a local chapter of the ESA Business Incubation Centre, or EsaBic, a pan-European initiative by the ESA to support space tech start-ups; the take-off accelerator launched by national development bank Cassa Depositi e Prestiti; and the Space Business Catalyst by Tas. 

The ‘Aerospace City’ initiative is underway to turn about 26,000 sq m of space in Turin into a place that brings together industry, academia and institutions to foster research into aerospace technologies, their applications and commercial deployment. 

“It’s a great opportunity to develop a national cluster able to incubate and develop collaborations around aerospace R&D,” says Marco Silvano, government affairs and funding leader at aerospace firm Avio Aero, one of the industrial partners of the initiative. “It’s an important strategic initiative that will have to be managed with a long-term horizon.”

If these initiatives cater to space entrepreneurship, the value chain is also engaging with existing companies working in different sectors to source some of the technology, thus promoting a pivot away from sectors where orders are flagging such as automotive. Among them are Sabelt, a producer of seat belts for motor racing based in Moncalieri, Turin, that has developed a line to serve space an aerospace clients; or APR, a company in Pinerolo, Turin, that leveraged its aerospace expertise to produce valves and pumps for space too. 

With space certifications often being a barrier for SMEs, the regional government is also setting aside funds to help them clear the certification hurdles they may face to cater to clients in the space economy. 

Ultimately, all these initiatives widen the horizons of Piemonte’s space ecosystem and its capacity to drive growth and employment. Space is back, and it’s in Piemonte to stay. 

This article is part of the Special Report:
Piemonte's next industrial horizons
Read more articles from the report