Privately held space launch company Rocket Lab has completed what it calls a "major milestone" in its effort to eventually reuse rockets, setting up a competition with Elon Musk's SpaceX in the race to make launches more affordable.

Rocket Lab completed the 16th launch of its Electron rocket off the coast of New Zealand, carrying 30 satellites into orbit for a number of customers. But the real drama came after the launch, when the large booster portion of the rocket was successfully recovered after splashing down in the Pacific Ocean.

The launch and recovery are part of Rocket Lab's plan to eventually reuse the boosters, which could cut the cost of launches. SpaceX has had success using the booster's engines to slow and guide it during reentry and eventually land it on a pad, but Rocket Lab is taking a different approach.

It hopes to use high-tech parachutes to slow the booster in reentry, and then capture it in midair using a helicopter. The rocket in this test performed the entire mission except for the helicopter capture, with Rocket Lab planning to use the test to gather data on deceleration and other elements in order to fine-tune the final plan.

"Bringing a whole first stage back intact is the ultimate goal, but success for this mission is really about gaining more data, particularly on the drogue and parachute deployment system," CEO Peter Beck said before the launch. "Regardless of the condition the stage comes back in, we'll learn a great deal from this test ..."

A rocket blasting off into space.

Image source: Getty Images.

The concept, if successful, could provide for more-affordable recovery than SpaceX's method because it does not require the engines to burn added fuel on reentry.

Rocket Lab specializes in small rockets that only make up part of the launch market, but its tests could have much broader ramifications. Musk has criticized SpaceX rival United Launch Alliance (ULA), a joint venture between defense titans Boeing (NYSE:BA) and Lockheed Martin (NYSE:LMT), for dragging its feet on reusable rockets.

ULA officials in the past have questioned the economics of reusing rockets, but the company has discussed a catch-in-flight system similar to what Rocket Lab is attempting. Should Rocket Lab succeed in demonstrating the effectiveness of the method, it would likely help prompt ULA to move in this direction for its new Vulcan rockets.

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