Seizing the Orbital Economy
America Must Build Factories in Space
America has been losing on many fronts in the strategic-industrial race with China.
A report by the Australian Strategic Policy Institute finds that China has an advantage in thirty-seven out of forty-four major emerging technologies. Already, China is by far the largest producer of commercial drones, holds a near-total monopoly on rare earth mineral processing capacity, leads in hypersonic missile development, and possesses 230 times America’s shipbuilding capacity. Even in nuclear energy, the Chinese have utterly leapfrogged American capabilities.
There is, however, one sector where the United States still holds a significant advantage: commercial outer space. To preserve and expand this lead, Washington should prioritize the industrialization of orbit through large-scale manufacturing in microgravity. This would secure American dominance in the emerging orbital economy, drive breakthroughs in advanced materials, and revitalize the nation’s industrial base.
Although China has recently made notable strides—successfully testing reusable rockets, creating its own satellite constellations, and even frying chicken wings on their space station—America still conducts twice as many orbital launches. Relatedly, since China’s reusable rocket technology is still in its infancy, their equivalents to Elon Musk’s Starlink have only launched a mere 120 satellites, compared to Starlink’s 8,000. This is far behind their own stated goals: the satellite constellation Qianfan planned to launch 650 satellites in 2025 but has so far only launched 108. Perhaps most importantly, the United States is determined to maintain its lead. American companies like Axiom Space, Nanoracks, and Sierra Space are pioneering the next generation of commercial space stations through NASA’s Commercial LEO Destinations program. And then there’s SpaceX’s Starship: if successful, it could drop launch costs to $150/kg, which is a tenfold decrease from the Falcon Heavy’s current pricetag of $1500/kg.
This dramatically reduced launch cost would make economically viable what was once prohibitively expensive: large-scale orbital manufacturing facilities and lunar mining. It would also present America with a historic opportunity to establish dominance in the orbital economy before any competitor can catch up. With this in mind, and as “science fiction” may sound, the focus of America’s space strategy should be the industrialization of outer space.
The promise of orbital manufacturing lies in the unique properties of microgravity. Many physical processes behave differently owing to the lack of gravitational force. These include, but are not limited to, crystallization, surface tension, combustion, material sag, foam formation, and mixing. These differences offer significant advantages over manufacturing on Earth. See no further than experiments on the International Space Station, where companies like Redwire (formerly Made In Space) have produced ZBLAN fiber optic wire. This is because, on Earth, gravity-induced crystallization creates signal-degrading defects, while the absence of convection currents limits production length. Meanwhile, in microgravity, ZBLAN can solidify without these imperfections, potentially yielding longer, perfectly uniform fibers that have ten times the quality of those produced on Earth.
Another promising technology is containerless processing. This involves allowing molten materials to float freely, without touching the walls of the container they’re stored in, thereby eliminating contamination sources and allowing for the creation of novel and ultra-pure materials. The Chinese are also already experimenting with containerless processing on their Tiangong-2 space station. Then there’s pharmaceutical production, currently being pursued by Varda Space, as microgravity suppresses convective currents, buoyancy, and sedimentation, and the resulting crystals are more uniform in size and structure.
In short, orbital manufacturing pushes the frontier of materials science. Yet although the United States already has all the components to start the orbital manufacturing revolution, Washington can do more to accelerate it.
Currently, all related innovative work is split across multiple companies and research programs, each pursuing its own specialized microgravity projects. As a consequence, many space manufacturing projects are fizzling out or have very slow and sporadic progress, owing to the extremely capital-intensive nature of experimenting in space. What America needs is a coordinated approach modeled after SEMATECH, the semiconductor manufacturing research consortium that successfully restored American competitiveness against Japanese chipmakers in the 1980s.
Such a consortium would bring together major launch providers, emerging space manufacturers, and traditional industrial giants to pursue the goal of making space manufacturing economically viable. By pooling resources and expertise, the consortium could accelerate development timelines, establish common technical standards, and create the critical mass needed to reach commercialization.
This should be pursued by NASA’s new administrator, Jared Isaacman, who is uniquely well-suited for this task, given his years of experience in the private spaceflight industry. He has already declared that “unlocking the orbital economy” is part of his vision for the agency.
Industrializing orbit also provides opportunities for America’s allies. Japan in particular stands out as a natural partner given its existing industrial know-how and burgeoning commercial space sector, which has been encouraged through government initiative. Its materials science sector is among the most advanced in the world, with deep expertise in ceramics, specialty alloys, and composites; all areas that benefit disproportionately from microgravity production. Japanese industry also famously leads in robotics and automation. This is already visible in NASA’s Artemis program, where Toyota is developing the Lunar Cruiser.
Japan’s commercial space ecosystem adds another dimension of synergy. Astroscale, a startup pioneering in orbital sustainability and servicing, is already working with the U.S. military: it was recently chosen to refuel a Space Force satellite in geostationary orbit. Pairing American reusable launch capacity with Japanese debris mitigation and servicing technologies would create a sustainable foundation for industrial infrastructure in space. Not only would this be a boon to both the American and Japanese civilian economies, but it would also create a common base of interoperable commercial infrastructure that can be readily integrated into each other’s space-based military systems. As an additional benefit, the approach would align seamlessly with the Department of War’s strategy of “prioritizing and aligning efforts to integrate commercial solutions into our national security space architecture,” while bolstering military cooperation with a key Pacific ally.
Moreover, if successful, this partnership would deny China the ability to unilaterally dictate the standards and rules of the orbital economy. By ensuring that allied firms control the market, Washington and Tokyo would shape both the commercial and security environment of space to their advantage. This model could eventually expand to include other trusted partners, establishing a network of allied orbital manufacturing hubs that reinforces both economic cooperation and collective security in space.
Finally, space industrialization is the key to revitalizing America’s industrial base as a whole. The first space race already demonstrated this phenomenon: NASA’s Apollo program created Silicon Valley. Materials science breakthroughs for heat shields and lightweight structures filtered into automotive and aerospace applications. The precision manufacturing techniques developed for rocket engines found their way into countless industrial processes. The examples go on.
Today, a similar dynamic could unfold on an even larger scale. Widespread deployment of space-manufactured ZBLAN fiber optics could revolutionize global internet infrastructure, while containerless processing techniques could create entirely new classes of materials for electronics and medical devices. Most significantly, the precision manufacturing ecosystem required to sustain orbital operations could finally inject competition into America’s stagnant defense industrial base. The specialized capabilities needed for space manufacturing, such as precision machining, advanced materials, and complex systems integration, directly overlap with defense aerospace requirements, creating natural competitors to established contractors.
This same ecosystem could spill over into the civilian economy. A dense network of advanced suppliers doesn’t just serve aerospace; it lifts every sector by giving manufacturers access to higher-quality components, faster innovation cycles, and more competitive pricing. It is precisely this kind of virtuous industrial clustering that allowed China to leapfrog into global manufacturing dominance. By catalyzing a similar cycle through the orbital industry, America can transform its remaining technological advantage into the engine that rebuilds its industrial strength.
Overall, the United States stands at a historic inflection point: its lead in commercial space offers the chance to industrialize orbit, secure the orbital economy, and rejuvenate its industrial base through microgravity breakthroughs. Under NASA Administrator Jared Isaacman, whose entrepreneurial vision aligns perfectly with this commercial imperative, America has the leadership and momentum to turn this advantage into lasting strategic and industrial supremacy. The next frontier is space industrialization, and the time to claim it is now.
Siddhartha Kazi is an industrial engineer working in supply chain management. He has previously written for The National Interest and Newsweek.