A Mega IPO Debuts Tonight, But China's Commercial Space Sector Needn't Copy SpaceX

"Macro Chat" is one of the most popular series on the Gao Neng Liang podcast. With your support, it has now run for over 100 episodes. Over that time, we kept seeing comments like this: "The information density in this episode is off the charts — is there a transcript I can study and re-read?" To honor that hardcore learning spirit, this year we've started converting select high-density conversations from the podcast into the "Macro Chat Column," using a "definitive conclusion + simple underlying logic + concrete case study" format. The compression of text inevitably sacrifices some of the vivid details from the original audio; for the full experience, head to the Xiaoyuzhou app or Apple Podcast and search for Gao Neng Liang. As Jared Diamond, author of Guns, Germs, and Steel, put it: under algorithmic curation, people increasingly see only content they already agree with, reinforcing existing views while instinctively rejecting different voices. In macro forecasting, there is no absolute right — because change is always happening. We simply hope to share one lens for observation, and welcome perspectives from every angle. (Note: This article and all content in this column are intended solely as discussion of business logic and macro trends, and do not constitute investment advice.)

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On June 12, U.S. time, SpaceX will list on the Nasdaq.

According to public reports, the company is targeting roughly $75 billion in fundraising at a valuation of $1.75 trillion — a rare "mega-IPO" in recent years. What's notable is that precisely because of mega-IPOs like SpaceX, the top spot for global fundraising may well return to the United States — something Feng Li mentioned in an earlier episode of Macro Chat. SpaceX can support such a valuation not just on the back of a Mars story. Per its prospectus, SpaceX revenue in 2025 will be approximately $18.7 billion, up 30% year-over-year; Starlink alone contributed about $11.4 billion, or over 60% of revenue, with global subscribers exceeding 10 million. In other words, SpaceX is no longer merely a storytelling company — it is a genuinely profitable business. But beyond the excitement of the U.S. stock market, we want to use this as a starting point to dig one layer deeper: Is commercial spaceflight actually a good business? What makes it hard, where does the money come from, and can China's commercial space companies catch up to SpaceX? This is the third installment of the Macro Chat column. Keywords for this episode: SpaceX IPO | Data as moat | Three rocket challenges | Four-step ladder | Engine leasing | Accessibility of space tourism...

Reader Giveaway:

Would you spend 80,000 RMB on a trip to space? Share your thoughts in the comments. By 17:00 on June 18, 2026, the two commenters with the most likes will each receive a copy of Commercial Spaceflight.

Commercial Spaceflight

By Shen Yingchun, Li Ang, He Pinglin

Citic Press Corporation

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01 Where Is the Real Demand for Commercial Spaceflight?

How to obtain data and data communications is becoming the most important competitive advantage and barrier to entry.

1. The real demand for commercial spaceflight is hidden in one word: "data."

Many people's first reaction to commercial spaceflight is rockets, satellites, Elon Musk. But the more fundamental question is: where does demand actually come from, and why will more and more industries need it? The answer lies in "data." How to acquire data and how to complete data communications are becoming the most critical competitive advantages and barriers across industries — and commercial spaceflight, positioned high above, happens to be able to capture data that simply cannot be obtained from the ground.

2. Real-time battlefield needs have turned commercial spaceflight from "eventually" into "right now."

Commercial spaceflight has heated up considerably over the past year, and to some extent this was "pushed" by the battlefield. The most typical driver is the need for real-time battlefield observation: whether via satellite or related high-altitude military means, both sides in a conflict need to track troop concentrations and targeting of firepower. The data on troop deployments and firepower configurations in the Russia-Ukraine war is the most familiar example.

More recent and more illustrative of genuine demand is the U.S.-Israel-Iran conflict. According to foreign media reports citing Pentagon documents, Starlink and its military variant StarShield have become the communications backbone for U.S. strikes against Iranian drones, while commercial satellite imagery has become a primary source for global media to confirm battlefield developments in real time.

3. The lower the orbit, the scarcer the resources. Occupying low Earth orbit is national strategy.

Why is everyone scrambling for low Earth orbit? Think of concentric circles: the closer a satellite is to Earth, the smaller that orbit's area and circumference, and the fewer satellites it can accommodate. Starlink is primarily deployed in the lowest such ring. But low orbit has a complication — satellites experience attrition, their orbits decay, and they eventually fall. Precisely because of this, securing low orbit resources first matters more and more at the national strategy level for both China and the United States.

Liu Yang, founding partner of FreeS Fund portfolio company JiuZhou Cloud Arrow, joined us for a podcast episode. According to his account at the time: low Earth orbit can accommodate roughly 100,000 satellites, SpaceX has filed for approximately 42,000, and various Chinese entities have plans totaling around 40,000.

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02 What Makes This Business So Hard?

The difficulty of rockets lies in the stacking of three problems: non-standardization, complex integration, and inability to trial-and-error at high frequency.

1. Three constraints stacked together form the true barrier of commercial spaceflight.

Rockets are actually a fascinating subject — in principle there are no scientific fundamentals that need to be cracked, yet they remain extraordinarily difficult.

The reasons come down to three points. First, almost none of their components are standard parts; each must be custom-made. Second, they represent large-scale system integration, where every part must be connected into an extraordinarily complex whole. Third, launch windows and launch resources are limited, leaving little room for trial and error. These three factors叠加起来 make adjustment extremely difficult, because every adjustment requires moving all three simultaneously.

2. A counterintuitive point: disposable rockets are actually more complex.

I had assumed that the hardest part of rocket engines was that their components are essentially single-use, so no one would produce them at scale. But Liu Yang told me the opposite is true: disposable engine components are actually more complex, while reusable engines have fewer parts.

The reason is that application scenarios drive product design. Disposable rockets pursue maximum performance and maximum payload capacity, with cost and timeline as secondary concerns, so they naturally grow more complex; reusable engines, for economic reasons, must increase integration and reduce part count. This is analogous to the shift from internal combustion to electric vehicles: the complex powertrain is transformed, integration rises, and parts decrease.

3. "Everyone is reinventing the wheel."

Precisely because of non-standardization, complexity, and difficulty of trial-and-error, every company must build this entire system from scratch independently. This is essentially "reinventing the wheel" — high complexity, high trial-and-error cost, and low volume. This gives rise to a core question in commercial spaceflight: in a business like this, how can costs ultimately be brought down?

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03 The Four-Step Cost Reduction Ladder, and Why SpaceX Leads

Rocket cost reduction must be climbed step by step, and SpaceX has already reached the top.

1. From getting to orbit, to getting to orbit "cheaply," lies four distinct steps.

Rocket cost reduction can be broken into four clear steps.

Step one: getting it up there — the most basic requirement. Step two: first-stage recovery — falling without breaking apart or being damaged. Step three: reusability after recovery — this is different from "recoverable"; landing back is one thing, whether the engine can be used next time is another. Step four: on the foundation of the first three steps, using processes like stainless steel single-piece forming to make rocket structures more amenable to low-cost, batch manufacturing, thereby dramatically reducing costs.

2. SpaceX has essentially completed all four steps; China's commercial space sector is between steps two and three.

Musk is indeed ahead, because he started more than a decade earlier. Last December, China's commercial space sector conducted two first-stage recovery tests in succession. First, a private rocket company achieved orbital flight on its maiden launch, but the first stage failed to soft-land during recovery; half a month later, the state-owned Long March 12A also achieved maiden orbital flight, with first-stage vertical recovery failing. Neither succeeded. It wasn't until this February that the Long March 10 completed China's first recovery of a first-stage rocket body at sea.

In other words, China's commercial space sector is still verifying and re-verifying between steps two and three, while Musk has already completed the final step. This gap is somewhat like the difference between Tesla and domestic electric vehicles in 2017–2018, or perhaps even larger.

Regarding how SpaceX got its start, there is a frequently overlooked origin story. During the space race era, NASA received massive funding; after the Soviet Union collapsed and the competition halted, budgets were sharply cut, yet existing missions still needed to be executed. NASA thus turned to outsourcing launch missions to private companies to reduce costs. SpaceX, founded by Musk in 2002, was among the companies that took on this outsourcing wave, though its early launches failed repeatedly, and it didn't truly secure NASA orders until 2008.

3. The gap is static, and there is opportunity to catch up.

JiuZhou Cloud Arrow, which specializes in first-stage rocket engines including reusable engines, gave us more specific figures via its founding partner Liu Yang. JiuZhou Cloud Arrow has already demonstrated reusable engine reuse exceeding 20 times per unit, with the upper limit not yet reached. As for the China-U.S. gap, Liu Yang calculates it differently: the static gap in commercial spaceflight is roughly 10 years, but once China completes the 0-to-1 breakthrough, the efficiency, supply chain, and productive capacity from 1-to-N are stronger than those in the United States. He even boldly predicts that within five years, the number of rockets and payload mass launched by China could likely match SpaceX's total over the past 15 years.

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04 China's Commercial Spaceflight Development Path: Standardization, Scale, and an "Engine Leasing" Business

The vast majority of airlines lease their aircraft engines rather than buying them; rocket engines may follow the same path.

1. China's commercial spaceflight advantage lies in manufacturing scale.

Unlike SpaceX's vertical integration, China's commercial spaceflight approach ultimately depends on manufacturing scale advantages: reusable, low manufacturing cost, and batch production — all four simultaneously. The standard is that standardization, low cost, scale, and reusability must all be achieved together. Only when these happen simultaneously does "commercial spaceflight at scale" truly become viable, and accessibility rise.

2. The future of commercial spaceflight may resemble airlines, following an "engine leasing" model.

Here is a fact many may not have considered: almost no airline buys its aircraft engines outright; instead they pay engine manufacturers by flight hour, paying for what they use — and this applies to most business jets as well. The reason is that engines are too expensive, and maintenance is too specialized and troublesome, so professional suppliers like Rolls-Royce and General Electric have made this a separate business, with airlines paying by the flight hour. Rocket engines face the same category of problem — high complexity, high trial-and-error cost, and low volume.

If in the future reusable, recyclable rocket engines also move toward financial leasing: rocket companies focus on building rockets, while reusable engines are leased from professional suppliers, this becomes far more economical for rocket companies. Suppliers customize 20 units at once to amortize manufacturing costs, then spread past trial-and-error costs across 20 contracts; even charging one to two million per launch, they can still turn a profit.

If this industry can achieve scale, it will likely eventually grow an "engine leasing" position, just as aviation has.

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05 When Costs Drop to 500 RMB per Kilogram, Ordinary People Can Take a Look at Space

At that point, the accessibility of going to space will approach that of visiting Antarctica today.

1. When costs are low enough, space travel shifts from "astronomical" to "affordable."

This is a hypothetical calculation. Putting one kilogram of payload (person, cargo, or resources) into space using a disposable rocket costs roughly 50,000 RMB (average estimate); assuming reusable rockets with more than ten reuses, costs might drop to several thousand RMB; assuming further cost reductions from stainless steel single-piece forming and scaled manufacturing, costs could drop another order of magnitude, to roughly 500 RMB per kilogram. Once costs reach this level, the math for human spaceflight changes completely. At 50,000 RMB per kilogram, a person of 70–80 kilograms would cost 3–4 million RMB just for launch — prohibitively expensive. But at 500 RMB per kilogram, that same person costs roughly 40,000 RMB; even doubling for ancillary fees, it's about 80,000 RMB.

At that point, as long as someone meets basic physical requirements — no heart disease, hypertension, severe myopia, and so on — ordinary people could spend a few tens of thousands of RMB to see space, roughly equivalent to a trip to Antarctica today.

2. When that day comes, the companies operating space tourism likely won't be rocket companies.

What's interesting is that this business will likely be divided by specialization. Eventually it may become: rocket companies focus on rockets, while the reusable, recyclable engine segment operates independently and leases externally. By then many rocket companies may no longer look as they do today, but more like service businesses, with rockets merely being their tools.

Conclusion

SpaceX's IPO is a signal, marking commercial spaceflight's transition from "storytelling" to "doing business." Yet on the road to mature commercialization, the path we take may not be copying SpaceX, but rather another approach — using the most complete industrial chain, with division of labor and collaborative cluster advancement.

As for which path more easily reaches a future where everyone can travel to space, time will tell.

Reader Giveaway:

Would you spend 80,000 RMB on a trip to space? Share your thoughts in the comments. By 17:00 on June 18, 2026, the two commenters with the most likes will each receive a copy of Commercial Spaceflight.

Commercial Spaceflight

By Shen Yingchun, Li Ang, He Pinglin

Citic Press Corporation

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