Virgin Galactic is deep into the development program of its spacecraft. Last month, the space venture owned by Sir Richard Branson sent test passenger Beth Moses on Virgin Galactic’s spaceflight – a first for a private U.S. company. Virgin Galactic’s spacecraft holds up to six passengers along with the two pilots. As the company has more than 600 would-be astronauts signed on to launch, Moses’ work is key to preparing Virgin Galactic for commercial operations. Tickets for Virgin Galactic’s flights are priced at $250,000 each.
UBS believes Virgin Galactic’s business model, as both a tourism company and manufacturer of spaceships, mimics the growth of businesses in the early days of aviation.
“In this way history could repeat itself as United Airlines today can trace back its roots to the Boeing Aircraft & Transport Company,” UBS said.
Blue Origin, the company founded by Amazon CEO Jeff Bezos, is also nearing its first spaceflights with human passengers. Blue Origin is developing the New Shepard rocket system for the company’s space tourism business.
As both Virgin Galactic and Blue Origin utilize reusable spacecraft systems, UBS believes the companies will be able to make space tourism “a more common occurrence” as reliability increases and prices decline.
“We estimate space tourism will be a $3 [billion plus per year] opportunity growing at double digit-rates,” UBS said. “This would be similar to what happened in commercial aviation, especially after the rise of low-cost airlines.”
SpaceX could also see significant cash flow from space tourism, UBS believes, through two different ventures. Elon Musk’s company just completed a historic test flight of its Crew Dragon capsule, which will be able to send as many as four astronauts to the space station. UBS estimates that NASA will pay SpaceX about $58 million on average per astronaut, compared to the $81 million per astronaut for flights on Russian Soyuz rockets.
The second SpaceX opportunity is for early flights of Starship to send tourists on missions beyond the Earth’s immediate orbit. In September, Musk announced Japanese billionaire Yusaku Maezawa signed with SpaceX to fly around the moon on Starship. Maezawa expects to fly in 2023, with six to eight guests joining him for the flight.