Who will win the new space race?

Just two days after NASA unveiled plans for a permanent base near the Moon’s south pole, Blue Origin – one of the private companies hired to be part of the project – suffered a spectacular setback. On May 28, the Jeff Bezos-owned company’s test rocket exploded in Florida, badly damaging its launchpad, which could take years to repair. No one was injured, but the failure brought the company’s lofty ambitions and plans for the first-ever privately funded lunar landing mission crashing down to Earth.

For NASA, the incident means mission delays, but for Blue Origin’s chief competitor, Elon Musk’s SpaceX, it could mean opportunity. SpaceX could potentially debut on the Nasdaq exchange as early as June 12 and is expected to raise $75 billion, with a company valuation of roughly $1.8 trillion. SpaceX could leverage this capital to develop new and better technology – and dominate the US space tech market.

The privatization of the space race in the United States has transformed it into a high-stakes contest between powerful private companies. Yet not every country has embraced the same private-sector approach. China’s model of space exploration remains overwhelmingly state-funded and state-directed, making the global space race a battle not only between superpowers but also between their economic models.

The war in Ukraine changed the game. Russia’s invasion of Ukraine four years ago marked a turning point for the role of space technology in modern warfare and the importance of private providers. After Moscow crippled Ukraine’s internet in the early days of the war, officials in Kyiv appealed to Musk to give them access to Starlink satellite communications terminals, which operate in low Earth orbit. More than 50,000 have been deployed across Ukraine since the war began, helping to facilitate Ukraine’s highly-effective offensive drone strikes that have themselves become the envy of the world.

The war in Ukraine also marked the definitive end of collaboration between the US and Russia in space. In 1972, then-US President Richard Nixon and then-Soviet Premier Alexei Kosygin signedan agreement to cooperate on peaceful space exploration. That partnership led to theApollo-Soyuz test project, the first international crewed space mission, and one that effectively ended the space race between the US and Soviet Union.

Over the past decade, however, Moscow has progressively withdrawn from its space collaboration with Washington. In 2020, Russiadeclined to participate in the Artemis moon program alongside the US and a handful of other countries, claiming that the US was making its return to space “a political project” rather than a collaborative one. Instead, Russia chose to partner withChina’s space program to establish a similar lunar base. The Kremlin has continued to work with Beijing since: in 2022, Moscow’s Wagner Groupacquired satellite imagery of Ukraine from Chinese tech rivals of Starlink, which cut off Russian access to its satellites in February of this year. Meanwhile, the US has announced it willdecommission the ISS by 2030 in favor of privately owned commercial space stations.

Land of the rising moon? In the last decade, China has eclipsed Russia as the US’schief challenger in the “second space race.” Beijing’s space plans include landing its first astronauts on the Moon's south pole before 2030. It will also expand its Tiangong space station and accelerate Mars exploration, possibly bringing back samples by 2031, ahead of the US, which plans to retrieve them sometime in the 2030s.

Unlike in the US, however, most of Beijing’s space programs are carried out by state-owned companies like the China Aerospace Science and Technology Corporation (CASC) and the China Aerospace Science & Industry Corporation (CASIC). Although the past decade has seen the establishment of some commercial firms, many still rely on government-backed capital funds.

The two powers’ approaches have their advantages and drawbacks. The American private-sector approach has prioritized innovation and cost savings, giving it a significant lead in launch capability. Reusable rockets developed by Blue Origin and SpaceX have lowered launch costs and simultaneously boosted launch rates. In 2025, the USlaunched 3,720 payloads – technology, supplies, and personnel needed for the mission – compared with China’s 371.

However, the US model has vulnerabilities. It depends on a handful of private firms, along with the short-term pressures of shareholders and the uncertainties of commercial financing. In contrast, China’sChang’e program for lunar exploration benefits from stable government funding, long-term planning, and a willingness to pursue strategic objectives over decades. It has also producedits share of successes, including becoming the first to return samples from the Moon's far side in 2024, using robots.

Astronomical returns await. The prize of space isn’t just scientific prestige or military advantage on future battlefields, it’s also economic. Artemis is explicitly designed to create a “lunar economy” by stimulating private-sector investment, developing new technologies, creating high-value jobs, and building commercial supply chains in deep space.NASA argues that lunar exploration will create new markets in transportation, communications, resource extraction, and infrastructure while strengthening American competitiveness. There are also ambitions for solar-powered data centers in space, which could also reduce the sky-high energy demands of artificial intelligence here on Earth.

China sees similar opportunities. Beijing’s plans for an International Lunar Research Station and eventual lunar settlement are intended to secure a foothold in the emerging “cislunar economy,” encompassing everything from resources found on the moon like titanium, helium-3, and rare-earth metals, to energy production, advanced manufacturing, satellite services, and strategic transportation networks between Earth and the Moon. Chinese planners also view space as a driver of technological innovation and long-term economic growth, much like how railways, aviation, and the internet shaped previous industrial eras on Earth.

Worlds collide. Ultimately, the new space race resembles the first. It is not just a contest between two superpowers, but a competition between their economic models. The key difference in the space race 2.0 is the rise of private actors – and the question of whether their cost and innovation advantage will win the day.