US set for $23.9m Rocket Lab deal over satellite and spacecraft chips

Washington — The US commerce department said on Tuesday it planned to award Rocket Lab $23.9m to dramatically boost compound semiconductors used in satellites and spacecraft.

The award for Rocket Lab unit SolAero Technologies Corp “would help create a more robust and resilient supply of space-grade solar cells that power spacecrafts and satellites”, the department said, adding it would “increase Rocket Lab’s compound semiconductor production by 50% within the next three years”.

The funds are to come from the Biden administration’s $52.7bn chip manufacturing and research subsidy programme that has benefited companies such as South Korea’s Samsung Electronics, Intel and Taiwan’s TSMC.

Commerce secretary Gina Raimondo said solar cells were crucial for keeping communication and space technology powered and operational, and the proposed Rocket Lab award would help give the US military, Nasa and the commercial space industry access to speciality semiconductors they need.

Rocket Lab is one of two US firms specialising in the production of highly efficient, radiation resistant compound semiconductors called space-grade solar cells, the department said.

The company, founded in 2006 by New Zealander Peter Beck, went public in the US in 2021.

Beck said the planned award would help the company expand production facilities to meet the US government’s growing demand for chips.

Rocket Lab solar cells support US space programmes, including missile awareness systems, the James Webb Space Telescope, Nasa’s Artemis lunar explorations, Ingenuity Mars Helicopter, and Mars Insight Lander.

The company, known for launching satellites on its Electron small rocket, is expected to test its reusable Neutron rocket next year. The rocket is designed to deliver many satellites to low Earth orbit and enable missions to Mars and Venus.

Rocket Lab has won several hundreds of millions of dollar in US federal contracts, including for satellite production, the launch of spacecraft and a deal to explore delivering cargo using its rockets.

The latest award, like others from the chips subsidy programme, have yet to be finalised and amounts could change after the commerce department conducts due diligence.

Reuters