Bloomberg: 3D Printed Rocket Maker Relativity Space Facing Financial Challenges

According to a recently published article in Bloomberg, the Long Beach-based launch company Relativity Space — one of many entities claiming to have the “world’s largest” metal 3D printer — “is running low on cash.” Since the matter is confidential, Bloomberg’s source is anonymous. The news outlet also received a comment from Sarah Lawson, a member of Relativity’s communications team:

 “Relativity Space is fully committed to the development and launch of Terran R,” said Lawson. “We continue to make significant progress toward our 2026 launch target and are confident in our ability to bring this innovative vehicle to market.”

The Terran R is the anticipated follow-up to the Terran 1, Relativity’s first (and, thus far, only) launch vehicle. In March 2023, Relativity launched the Terran 1 successfully, although the rocket failed to reach orbit, which isn’t unusual for a first attempt. In fact, even without reaching orbit, launching and reaching space on the initial flight is a major accomplishment, especially given that Relativity used additive manufacturing (AM) for about 85 percent of the finished product.

Not long after Terran 1 was propelled from Earth, Relativity announced the Terran R, aiming for a 2026 launch date. At the time, the company’s co-founder and CEO, Tim Ellis, compared the Terran 1 to “a concept car”, with the Terran R meant to incorporate design and manufacturing principles from its predecessor, albeit on a much larger scale.

While the Bloomberg article refers to the Terran R as a “[move] away from 3D printing”, Relativity’s framing at the time of the initial announcement was that the company was shifting how it would use AM, with Ellis telling CNBC, “Our long-term vision has not changed … we’re still super focused on additive development.” Considering that the Terran 1 was 110 feet tall and around 20,000 pounds, while the Terran R is planned to weigh over three times that and stand at 275 feet tall, it would likely be infeasible to use AM for the same proportion of the Terran R, as was used for the Terran 1.

In any case, if Relativity is indeed struggling financially, it would be more or less par for the course in the private space industry these days, as the Bloomberg article notes. For instance, around the same time as Relativity was announcing the Terran R, AM innovator Virgin Orbit filed for Chapter 11 bankruptcy.

On the other hand, Rocket Lab kicked off 2024 with a $515 million Space Force contract, and SpaceX’s valuation continues to climb, with the latest estimate gauging the company’s worth at over $200 billion, making it the world’s second-most valuable startup. But given that one of Relativity’s aims is to provide an alternative to SpaceX — a worthwhile goal considering that the latter company is responsible for over 90 percent of US launches — any trouble at Relativity Space should be cause for concern to US policymakers.

Again, if the company is having a tough time finding additional capital, as Bloomberg states, it would be yet another sign that the US’s attempt to reshore manufacturing supply chains is in dire straits. If a company with as much vision and as much success thus far as Relativity can’t find funding, the problem may lie in the business environment.

Further interest rate cuts could help, and so would a return to the pre-2022 status quo for the US R&D tax credit. But above all, despite all the talk of shifting industrial policy over the last several years, the US is still in desperate need of a jumpstart towards rebuilding its manufacturing landscape, and it’s a national security imperative that companies like Relativity Space are encouraged to thrive.

Images courtesy of Relativity Space