In 2024, the International Space Station could die -- and Russia could be on its way back to the Moon.
That's the upshot of a pair of news items that appeared late last month on the Kremlin-sponsored news site Russia Beyond the Headlines. 57 years ago, the Soviet Union won the Space Race, becoming the first nation on Earth to put a satellite into orbit around the Earth. Today, Russia is beginning an ambitious program to develop a new class of space ships that will leapfrog the U.S. space program once again.
Dubbed the "Prospective Piloted Transport System" (PPTS) these ships could put Russians on the Moon as early as 2030.
Space Race II: The Russian Empire Strikes Back
Here's the plan that Russian space agency Roscosmos has put forward, in a nutshell:
- 2020: Russia terminates involvement with the Earth-orbiting International Space Station. Begins collecting proposals for the construction of a manned Lunar Orbital Station (LOS) to orbit the Moon instead.
- 2021: First flight of the 14-ton PPTS spaceship, probably to ISS. Russia's still-in-development Angara rocket would carry the PPTS into orbit. Two additional trips will follow in 2022 and 2023.
- 2022: Prepares initial designs for LOS equipment. Begin ground and space testing of "a manipulation system for seizing and carrying cargo and for impact-free docking of modules and spacecraft."
- 2024: First manned mission aboard the new spaceship to ISS. Begins ground testing of LOS equipment.
- 2025: First flight of a heavy-lift version of the PPTS spaceship, 20 tons in size, to ISS. Approval of initial designs for complete LOS modules, including one laboratory module, one energy module, and one "node" module at which visiting spacecraft will dock.
Thereafter, the new 20-ton version of the PPTS spacecraft will begin making regular flights to the Moon, manned by crews of four cosmonauts.
Funding Russia's grand plan
As the website SpaceflightInsider observes, Russia has been talking about putting cosmonauts on the Moon for years, but "such statements were largely empty gestures without funding to support them." However, this detailed plan that Roscosmos has put forward is a new development. It also comes with budget requests for upwards of $530 million in funding -- a fact that SI says shows Russia's "growing seriousness" about making a go of the project.
Roscosmos estimates the total cost of the project at $6 billion. (Albeit, that's a tiny fraction of what NASA estimates it would cost to return U.S. astronauts to the Moon). At present, Russia's likely primary contractor is state-owned Rocket and Space Corporation Energia.
What it means to investors
But if Russia is planning this as a solo project, and giving all the work to a company owned by the Russian government, is there any way for U.S. investors to get in on the fun?
Maybe, possibly, yes. After all, if Russia is heading to the Moon, this may give the U.S. government the "nudge" it needs to revive America's own space program. Here's how:
In 2010, in a cost-cutting move, the U.S. government shut down NASA's "Constellation" project, which was supposed to return America to the Moon by 2020. That move immediately dimmed the prospects for Boeing (NYSE:BA), Lockheed Martin (NYSE:LMT), Orbital Sciences (NYSE:OA) and ATK (NYSE:ATK) -- America's four biggest "space" companies -- winning work on an American-led Moon mission. It probably contributed to United Technologies' decision to largely exit the space business by selling its Rocketdyne division to new owner Gencorp (NYSE:AJRD).
A reignition of the Space Race, though, could reverse all of this, and open up new prospects for revenues for each of these players:
- Lockheed Martin, which has been contracted to build the Orion spacecraft (now repurposed as a vessel to carry astronauts to Mars);
- Boeing, which NASA recently tapped to build the core stage of a new $2.8 billion "Space Launch System" that could power a spaceflight to the Moon... or even to Mars;
- Orbital and ATK -- soon to become one single firm, Orbital ATK -- who were to develop the spacecraft's launch abort system;
- and Gencorp, which inherited United Tech's J-2X engine technology -- and is partnering with privately held space tech firm Dynetics to build an even better rocket engine.
Revenues from a renewed Space Race could be incredibly profitable for these companies. For example, S&P Capital IQ figures show that Lockheed Martin gets only $8 billion a year in revenue from its Space Systems business today. That makes "space" one of the company's smaller lines of business. But the 13% operating profit margins that Lockheed earns from its space work make this the company's second most profitable business -- 30% more profitable than the profit margin for Lockheed Martin as a whole.
The upshot for investors? Russia has thrown down the gauntlet on a new Space Race. If America picks it up, these are the companies you'll want to ride to the finish line.
Rich Smith has no position in any stocks mentioned. The Motley Fool recommends Orbital Sciences. The Motley Fool owns shares of Lockheed Martin. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.