Industry Analysis • May 28, 2025
Analysts project the in-space services market will reach hundreds of billions of dollars within two decades. That projection depends entirely on infrastructure that does not yet exist at the required scale — and propulsion is the most critical missing piece.
"Every major economic expansion in history has been preceded by a logistics revolution. The in-space economy is no different — and propulsion is the logistics layer."
There is a remarkable gap between the ambition of the in-space economy narrative and the infrastructure that currently exists to support it. Investors, analysts, and policymakers routinely cite projections of a trillion-dollar space economy by mid-century. These projections are not implausible — the underlying demand drivers are real. But the path from current capability to that scale passes through a set of infrastructure challenges that are rarely examined with the same rigor as the headline numbers.
One of those challenges is propulsion. Not launch propulsion — the rocket industry has made extraordinary progress in reducing the cost of reaching orbit. We mean in-space propulsion: the capability to move payloads between orbits, to keep satellites precisely positioned, to deorbit defunct hardware, to refuel operational spacecraft, and to enable the kind of routine orbital mobility that underpins every major in-space economic activity. This is the layer that is missing, and its absence is already constraining the growth of the commercial space sector in concrete, measurable ways.
Launch vehicles can deliver payloads to a narrow set of orbital insertion points. Commercial rideshare missions — the dominant launch modality for small satellites — deliver to a shared orbit, not the customer's preferred orbit. This means that a satellite launched to a 550-kilometer sun-synchronous orbit may need to maneuver to a different altitude, a different inclination, or a different phase within the same orbital plane before it can begin its intended mission.
For satellites with capable onboard propulsion, this is manageable — expensive in propellant and time, but doable. For satellites without propulsion, or with propulsion systems that lack the performance to cover the required delta-v budget, it is not. The result is a significant fraction of satellites that are either stranded in a suboptimal orbit or consumed a disproportionate share of their propellant reserves reaching the correct orbit, reducing their operational lifetime before they have delivered any commercial return.
An orbital logistics vehicle — a purpose-built propulsion platform that can collect payloads at insertion orbit and deliver them to their operational orbit — solves this problem. It allows satellite manufacturers to simplify their spacecraft design (removing or reducing onboard propulsion), reduces the delta-v burden on the payload, and enables a launch profile where the logistics vehicle handles the final-mile delivery problem.
The economics of satellite operations are straightforward: the longer a satellite operates, the lower the effective cost per unit of service delivered. A satellite with a 10-year design life that operates for 15 years because it received a propellant top-up at year 8 generates 50% more revenue per dollar of capital invested. The math is compelling — yet in-orbit refueling remains largely theoretical at commercial scale because the propulsion vehicles needed to deliver the propellant do not exist in sufficient numbers or at sufficient reliability to build a commercial service around.
The same logic applies to orbit correction and station keeping for constellations. As constellation sizes grow, the per-satellite cost of dedicated propulsion decreases in importance relative to the fleet-level cost of maintaining precise orbital geometry. An external logistics vehicle that can perform periodic orbit adjustment for multiple constellation nodes in a single mission may be more economical than equipping every satellite with the propulsion to do it independently.
Regulatory pressure on satellite operators to comply with end-of-life deorbit requirements is increasing globally. The FCC's recent rule change requiring deorbit within five years of mission completion is the most significant signal to date that passive disposal — relying on atmospheric drag to gradually lower a satellite's orbit over decades — will no longer be acceptable for operational satellites. This creates a direct commercial demand for deorbit services provided by external propulsion vehicles, particularly for satellites that lack sufficient onboard propellant at end of life.
Deorbit logistics is not a niche application — as the current generation of large constellations reaches end of life over the next decade, the volume of spacecraft requiring assisted disposal will be substantial. Building the propulsion infrastructure to service that demand is not an optional nice-to-have; it is a regulatory necessity that will shape the economics of satellite operations for the foreseeable future.
Every major economic expansion in history has been preceded by investment in logistics infrastructure. The shipping container standardized global freight and enabled a decade of growth in international trade. Highway networks made regional distribution economically viable for goods that previously required rail. The in-space economy will follow the same pattern: growth will accelerate when the logistics infrastructure exists to support it, and it will remain constrained until that infrastructure is in place.
Propulsion is the logistics layer of the space economy. It determines what can be moved, where it can go, how reliably it can get there, and at what cost. Companies that solve this problem at commercial scale will occupy a position in the space economy analogous to the container shipping companies that built the physical infrastructure of globalization — not the most visible layer, but the most essential one. That is the market PAVE Space is building for, and the infrastructure we are committed to delivering.