Uh Oh... Looks Like Axiom Space is in Trouble

The subtitle is What happens when a Space 1.0 Guy Runs a Space 2.0 Startup  

According to a report in Forbes online (they won't let anyone read that without being a subscriber), Axiom Space is in trouble. Outlined by Ars Technica, this afternoon, it sounds like my subtitle. 

... Axiom Space, which was founded by billionaire Kam Ghaffarian and NASA executive Mike Suffredini in 2016, has been struggling to raise money to keep its doors open and has had difficulties meeting its payroll dating back to at least early 2023. In addition, the Houston-based company has fallen behind on payments to key suppliers, including Thales Alenia Space for its space station and SpaceX for crewed launches.

"The lack of fresh capital has exacerbated long-standing financial challenges that have grown alongside Axiom’s payroll, which earlier this year was nearly 1,000 employees," the publication reports. "Sources familiar with the company’s operations told Forbes that co-founder and CEO Michael Suffredini, who spent 30 years at NASA, ran Axiom like a big government program instead of the resource-constrained startup it really was. His mandate to staff up to 800 workers by the end of 2022 led to mass hiring so detached from product development needs that new engineers often found themselves with nothing to do." Bold added: SiG 9/17/24

The big problem here isn't Axiom; the problem is that NASA is depending on them to build a successor to the International Space Station. When the company was founded in 2016, the plan was to launch an initial space station module in 2020. 

They're taking advantage of the precedent that SLS/Artemis set for being late and over budget.

Presently, Axiom plans to launch its first module to the International Space Station no earlier than late 2026. And the company's ambitions have been downsized, according to the report. Instead of a four-module station that would be separated from the government-operated space station by 2030, Axiom is likely to go forward with a smaller station consisting of just two elements.

It seems unnecessary to say a two module station won't be able to do as much as one with four modules, if the modules are the same size.  

"The business model had always counted on having significant power for microgravity research, semiconductor production, and pharmaceutical production, plus supporting life in space," a source told the publication. "The business model had to change… and that has continued to make it challenging for the company to get around its cash flow issues."

Axiom is one of several companies—alongside Blue Origin, Voyager Space, Vast Space, and potentially SpaceX—working with NASA to devise commercial replacements for the International Space Station after that facility retires in 2030.

So with the contractor on the verge of going down in flames, what's NASA to do?  Why, issue a Request For Proposal (RFP), of course! This new RFP will be issued for a second round of commercial space station contracts in 2025 and the contract awarded the following year.  Whomever NASA awards the contract to, they'll be starting to work at around the time Axiom might have been able to deliver their first module.

Possibly worse than that is that many insiders say NASA may be trying to get two contractors. While the ISS was built over many years with Space Shuttle cargo flights, those aren't flying anymore. Could another one be done?  Who lifts the cargo? New Glenn? Starship? Axiom founder Kam Ghaffarian said there isn't enough work for two contractors. NASA should decide on one contractor and award the contract in '25. "Today there's not enough market for more than one," he said.

The one bright spot - or a less dim spot, if you prefer - is about Axiom's other major contract with NASA, the $228 million contract to develop spacesuits for the Artemis Program. 

Multiple sources have told Ars that, from a financial and technical standpoint, this spacesuit program is on better footing than the station program. And at this point, the spacesuit program is probably the one element of Axiom's business that NASA views as essential going forward.

Axiom's vision of their own space station. A screen grab off their website from 2020. This is not the "initial module" mentioned above. That was illustrated here.