Space Business Roundtable
As prepared for delivery
Chairman Fred P. Hochberg
Feb 20, 2014 – Washington, DC
Good afternoon, and thank you, Steve, for that introduction. Thank you all so much for inviting me to join you here today.
Back in 1962, I was 10 years old; that year, John Glenn became the first American to orbit the Earth. And after he returned from his mission he was asked one question over and over again: “When you were sitting in that capsule listening to the countdown, how did you feel?”
I'm sure you're all familiar with the response he gave 35 years later. In a speech announcing his plans to retire from the Senate, he finally answered the question. And what he said was that he felt “exactly how you would feel if you were getting ready to launch and knew you were sitting on top of two million parts—all built by the lowest bidder on a government contract.”
At the time that John Glenn was up there circling the globe, the Earth had fewer than five satellites—and one of those was the Moon. Half a century later, nearly 2,500 satellites are orbiting around us as we speak.
At the Export-Import Bank, we know what that growth signifies. We understand the critical role that space-related businesses will play in shaping our economic future. In fact, satellites are a prime example of what we're all about at Ex-Im.
Creating these products is an incredibly complex undertaking—so much so, in fact, that the English language now uses it as the benchmark against which all other fields are measured: ‘You think your job is tough? Well, sure, but it isn't rocket science!'
Now, financing these complex products isn't rocket science either—but it's still an enormous challenge.
John Glenn may have joked about those government contracts. But the truth is, private banks can't always operate at the scope and size necessary to move satellite projects from the design lab to the factory floor to the international marketplace.
Your average bank can't do it. But Ex-Im can.
Our mission is to fill those financing gaps. We want to keep American companies from falling behind their global competitors. And we're working every day to fulfill that mission.
In fact, we've completed 16 major satellite authorizations since 2010, totaling more than $4.1 billion. Those are numbers we're proud of, but what we're most proud of is the tens of thousands of American jobs those projects supported.
That's our top priority.
In fact, we supported more than 205,000 American jobs in 2013 alone. Let me repeat that: 205,000 jobs in just one year—and a lot of those are skilled jobs in space-related industries.
Now, just a few years ago, Ex-Im wasn't heavily involved in the satellite field. Between 2002 and 2009, we averaged around $50 million per year in authorizations for satellite exports.
But today, satellites represent the fastest-growing sector in our entire portfolio. You heard that right: satellites are our biggest riser at Ex-Im. Not energy, not airplanes, not infrastructure—satellites.
In fact, our authorizations on satellite exports have jumped from $50 million per year to a billion per year since 2010. And more than 60 percent of all American commercial satellite exports are now supported by financing that comes from Ex-Im.
As the U.S. satellite industry grows, our support is growing, too.
Now, everyone here knows how competitive the global market is when it comes to satellites. Demand for satellite-based services is increasing exponentially around the world. It's difficult enough to compete with aggressive foreign competitors without having to worry about aggressive foreign financing as well.
So we have to ensure that satellites stamped “made in the U.S.A.” are able to compete on an equal footing with their international competition—because American products deserve every chance to succeed on their merits. An American company might lose a sale because of pricing, or scheduling, or technical specs, or any number of reasons—but they shouldn't lose a sale because of financing.
At Ex-Im, that's where we come in. By breaking down barriers to financing, we're leveling the playing field for American satellite companies.
We saw a number of great examples of that just in the last year. Let me tell you about a few.
Just this morning, we approved an $80 million loan that will send one of Orbital's American-made satellites to a Mexican firm for scheduled launch next summer.
For Lockheed Martin, just last week we commenced funding on a project to send our first project finance satellite to NewSat in Australia. This is Lockheed's first commercial satellite—and I understand Michael Hewins of NewSat is here with us today.
For Space Systems/Loral, partnering with Ex-Im gave them the opportunity to export three telecommunications satellites to Hong Kong. We authorized $523 million to finance the deal, which is supporting another 600 jobs for technicians, engineers, and other skilled employees here in America.
For Boeing, a long relationship with Ex-Im has most recently supported the construction of two pioneering new all-electric propulsion commercial satellites, which were purchased by another satellite group in Hong Kong.
I had the chance to tour the Boeing satellite factory out in El Segundo about a year ago. Before it was producing satellites—before anyone was producing satellites—that same factory was where American Motors built their iconic Nash Rambler, back in the 1950s. It was a remarkable feeling walking that factory floor that had been an epicenter of American innovation for 60 years.
And on that same trip, I had the opportunity to visit another American innovator, SpaceX. They happen to be the company providing launch services for both the SSL and Boeing satellites I just mentioned.
SpaceX is a remarkable American success story. A dozen years ago, SpaceX didn't exist. Eight years ago, it was a small business with fewer than 200 employees.
Well, it isn't a small business anymore. Today, more than 3,000 people are part of the SpaceX team. And in just the last 12 weeks, SpaceX has successfully completed its first two geostationary launches.
We're talking about an all-American company. The supply chain is here. The manufacturing base is here. The launches happen here. And the jobs are here.
As you know, SpaceX is testing and deploying rockets in revolutionary ways. They're even figuring out ways to reuse rockets—which I think constitutes the world's most ambitious recycling program. Their success is proof that the sky is not the limit for American satellite manufacturers.
The growth of SpaceX from an ambitious small business to a leader in its global field is a terrific story. And for Ex-Im, that's the type of story we try to help make possible with every business we serve. We want to make sure that companies like SpaceX can keep turning their aspirations into realities.
This year, we welcomed SpaceX's President, Gwynne Shotwell, onto our advisory committee, ensuring that the space industry remains well-represented at Ex-Im. And we're thrilled that Elon Musk will be joining us at Ex-Im's annual conference in April.
For many of us of a certain age, our lifetimes have run more or less parallel to the lifetime of satellites. As we grew up from the days of wearing diapers to the days of wearing suits, the space industry grew up from the days of Sputnik and John Glenn to the days of the Falcon 9. But decades from now—when I'll be trying to avoid going back to the days of wearing diapers—satellite technology will still be growing more sophisticated and more vital.
In many ways, satellites are still in their infancy. But already, they are redefining the way we communicate, navigate, observe, and explore. Satellite technology has advanced all sorts of other technologies—from solar energy and water purification to dustbusters and even Speedo swimsuits. And in the years to come, it will continue to impact our lives and our economy in ways we can only imagine.
Of course, I can't tell you what the next great innovation in satellite technology is going to be.
But I can tell you that Ex-Im is going to be there, standing right alongside the innovators who are ensuring that America continues to lead the way.
I can tell you that we've got the expertise and the experience necessary to move projects forward.
I can tell you that we will continue to be flexible, dependable, and entrepreneurial in our approach.
I can tell you that we are sector-driven, and attuned to the satellite industry.
And I can tell you that—when you work with our team at Ex-Im—we're going to fight to make sure that you never lose out to a competitor on a deal due to a lack of financing.
And speaking of that team, John Schuster and Michelle Miller are here with me today.
Michelle is your point of contact for working with Ex-Im. She knows the satellite industry in and out. She's watching the trends. She's ready to work with you to get projects moving. John, of course, is the proud owner of one of those Speedos made possible by satellite technology.
They want to work with you, and learn more about your priorities. They want to make sure that you know about everything Ex-Im can do to help you maintain a competitive edge. So I encourage you to talk to us—and to join us at our annual conference on April 24th and 25th at the Omni Shoreham Hotel.
It's going to be an excellent opportunity to meet with leaders like Elon Musk as well as the Ex-Im team. It's a chance to talk about how we can work together to grow your businesses in the years ahead.
Now, as you know, we're focused on a lot of things at Ex-Im. And when our next reauthorization comes up in about six months, we'll be focused on working with Congress to ensure that we'll still be around to keep fighting for American jobs.
But we'll never stop focusing on our customers.
We are here to help you succeed. That's our purpose. We want to give you the support you need to build the next great American satellite, to hire the next American worker, to take the next step forward in one of the defining industries of our time.