Sinolink Securities released a research report stating that based on SpaceX's proven dominance in launch capabilities and Starlink's monetization path, the core investment logic for China's commercial aerospace sector can be summarized as: embracing the infrastructure boom of the Qianfan constellation and locking in high-barrier component suppliers.
From a timing perspective, China is currently in a pre-networking phase similar to SpaceX's 2018–2020 period. With the G60 Qianfan and GW national satellite networks entering intensive launch phases, satellite manufacturing is transitioning from lab-based customization to automotive-style mass production. Before liquid reusable rocket technology fully matures, the most certain alpha returns in the supply chain will come from high-value, high-entry-barrier satellite core components and payloads. Suppliers capable of providing standardized power, communication, and attitude control systems will be the first to realize earnings.
SpaceX is not a traditional aerospace manufacturer but rather a space logistics and infrastructure monopolist that has taken first-principles thinking to the extreme—breaking the myth that rockets must be expensive, abandoning single-use designs, and rapidly iterating without perfectionism. It has built a self-reinforcing business loop: leveraging Falcon 9’s unmatched launch cost advantage to create the world’s largest space communications network, Starlink, and using the massive cash flow generated by both to fund Starship, the most ambitious engineering project in human history.
**Moat Analysis**: SpaceX’s core competitiveness stems from deep integration across three dimensions.
1. **Cost Barrier**: Unmatched Reusability Economics By fully reusing Falcon 9’s first stage, SpaceX has transformed space launches from bespoke craftsmanship into standardized industrial products. Its internal marginal launch cost has dropped to around $15 million, with gross margins reaching ~68% after five reuses. This cost structure grants SpaceX pricing power that dwarfs traditional defense giants like Boeing and Lockheed Martin. This is not a patent barrier but a scale-driven manufacturing and operational moat—even if competitors develop reusable rockets, they cannot replicate SpaceX’s data and supply chain efficiency from 100+ annual launches.
2. **Manufacturing Barrier**: Vertical Integration & Advanced Production From engines (Merlin/Raptor) and airframe structures to laser communication modules, spacesuits, and flight software, SpaceX produces over 80% in-house. While vertical integration requires heavy upfront investment, it enables unparalleled iteration speed and cost control. This "supply chain mastery" allows spacecraft updates at consumer electronics speed, moving rocket production from artisanal workshops to assembly lines.
3. **Customer Barrier**: Strategic Symbiosis & Key Accounts SpaceX’s relationship with the U.S. government has evolved beyond a contractor-client dynamic into a deeply intertwined strategic partnership. NASA and the DoD’s long-term, high-value contracts effectively subsidize SpaceX’s R&D (especially Starship), while the government gains independent, reliable, low-cost, and cutting-edge space access—freeing itself from the inefficiencies of traditional "cost-plus" defense contracts.
**Triple Growth Curves**: SpaceX should not be valued as a traditional defense firm but as a combination of three lifecycle businesses: - **First Curve**: Absolute monopoly in launch services, acting as a cash cow with high market share and margins. - **Second Curve**: Starlink’s exponential growth, marking its shift from B2B manufacturing to B2C services. As the world’s largest satellite internet operator, Starlink boasts SaaS-like recurring revenue with a far higher ceiling than traditional launches. - **Third Curve**: Starship’s disruptive optionality—a bet on future space economy infrastructure. Once mature, Starship could unlock trillion-dollar markets in space tourism, point-to-point transport, and deep-space resource exploitation.
This blend of cash flow, hypergrowth, and optionality underpins SpaceX’s unique valuation premium.
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