Glasgow's satellite boom faces European competition as governments back rival space hubs

Craig Clark came home to Glasgow in 2005 with an idea. He'd left Scotland a decade earlier because the jobs he needed didn't exist there—they were all south of the border. Now he wanted to build something himself. He called his company Clyde Space, and he chose to do it in a city whose industrial reputation had been built on shipyards along the River Clyde, a place where "Clyde-built" once meant something real: engineering, craft, durability. What Clark couldn't have known was that he was about to help resurrect that tradition in an entirely different form.

Today, Glasgow is Europe's capital of small satellite manufacturing. The satellites built here are mostly CubeSats—modular devices the size of a Rubik's Cube, measuring just ten centimeters on each side. They are cheap to produce, quick to develop, and stackable. Pack them with cameras, sensors, communications gear, or other technology depending on what you need them to do. Their size belies their reach. The data they collect now threads through everyday life: communications, navigation, tracking ships, monitoring crops and forests, managing energy networks, understanding climate. For governments, satellite data has become essential infrastructure for decision-making and emergency response.

Clyde Space built Scotland's first satellite, the UKube-1, in partnership with the University of Strathclyde. Other companies followed—Craft Prospect, Alba Orbital, and others. The University of Strathclyde became a pipeline of engineers. American satellite company Spire opened its European headquarters in Glasgow in 2015. A cluster formed. By 2022-23, the Scottish space industry generated £335 million in income, up 69 percent in five years. Space manufacturing alone accounted for more than 1,000 Scottish jobs. The Scottish Government now says more small satellites are built in Glasgow than anywhere else in Europe. What's remarkable is that none of this was planned. It grew organically, driven by commercial ambition and proximity to research talent, not government mandate.

But the landscape is shifting. Germany's Defence Ministry has announced plans to invest around £30 billion in military space capabilities over the coming years, including more than 100 encrypted communications satellites. Finland's aerospace firm ICEYE, which specializes in radar satellites that can image the Earth through cloud and darkness—technology used to track Russian vessels during the war in Ukraine—raised more than €1 billion in funding this year. The Finnish state increased its stake in the company to around 12 percent. Across Europe, governments are no longer simply funding research and innovation. They are becoming major customers. They want guaranteed access to satellite communications. They want the satellites built within their own borders. They want domestic ownership of what they now see as strategic capability.

This matters because space is not a normal market. When governments become the primary customer, they shape where companies invest, where engineers work, where expertise accumulates. Gabriele Piazza, an economist at the London School of Economics who studies government procurement of advanced technology, puts it plainly: "Since capabilities build on themselves, firms with a large customer at home gain an advantage that lasts." Already, some Glasgow-founded companies have moved. Clyde Space was acquired by Swedish firm AAC Microtec in 2018, though Glasgow remains the group's main manufacturing site. Alba Orbital moved its headquarters to the United States while keeping a Scottish base. Spire expanded its manufacturing operation into Munich.

Yet the story is not one of decline. Simera Sense, a satellite camera manufacturer, announced this year that it was opening a new production facility in Glasgow, creating 20 highly skilled jobs. Glasgow's concentration of universities, engineers, and specialist suppliers—built up over two decades—would be difficult to replicate elsewhere. Some comparisons with overseas competitors are not exact. ICEYE is one specialist company focused on radar satellites. Glasgow is an entire manufacturing cluster producing different kinds of small satellites. Spire expanding in Munich does not necessarily mean it is retreating from Glasgow.

The harder question is what comes next. Will Lecky, a space economics consultant, warns against the government simply trying to outspend competitors with grants and subsidies. Glasgow's small satellite industry grew partly because of a lack of government support, as part of the commercially-focused "newspace" revolution. Entrepreneurs, he argues, would choose a paying customer over a grant with paperwork and scrutiny. And increasingly, governments are becoming that customer. Government contracts can give young companies revenue, a track record, and the credibility to win business overseas—something a grant cannot do. But there is a cost. Money spent supporting one industry cannot be spent on hospitals or schools. Governments are often poor at picking winners. And if everyone subsidizes, nobody necessarily gains ground.

The deeper question is strategic. Satellites provide communications, navigation, and intelligence during conflict. Beyond defence, they underpin transport, energy, telecommunications, and emergency response. Governments must decide which capabilities they are comfortable buying from overseas or from allies, and which they need to keep at home. There is evidence that public investment in space produces returns—every pound of UK investment through the European Space Agency generated £7.49 in direct economic benefit, according to an independent evaluation. But the risk, as Piazza notes, is not closure. It is that the next phase of growth follows the contracts elsewhere. Glasgow has already proven it can build a successful satellite industry. The question now is whether the next phase of that success is built here too.