After the Israeli government’s decision to subsidize Israel Aerospace Industries (IAI) to build the AMOS-8 communications satellite, Spacecom has informed U.S. satellite manufacturer Space Systems Loral (SSL) that it is cancelling its March 2018 contract for them to build the satellite.
According to various media reports, Spacecom notified the Tel Aviv Stock Exchange that it would not be making an AMOS-8 down-payment due 25 September 2018, rendering null the U.S.$112 million manufacturing agreement with SSL.
The cancellation of the AMOS-8 contract is another blow to SSL. Its parent company, Maxar Technologies, is considering selling, partnering off, or closing its geostationary satellite manufacturing business.
Spacecom’s decision in March 2018 to purchase AMOS-8 from a U.S. company rather than from state-owned contractor Israel Aerospace Industries (AIA). This decision raised concern that Israel could lose its ability to produce telecommunications satellites in-country. To date, IAI has built Earth observation satellites for foreign customers, but Spacecom has been IAI’s primary customer for communications satellites.
In late April 2018, the Israeli government told Spacecom that it intended to order a satellite from IAI and place it in the same geosynchronous orbit as most of Spacecom’s fleet. On 3 September 2018, Israel’s Ministry of Science and Technology announced that AMOS-8 would be built in Israel with government financial support.
Spacecom had ordered AMOS-8 from SSL as a replacement for AMOS-6, the IAI-built satellite destroyed in a fueling accident with a SpaceX Falcon-9 launch vehicle in 2016. As an interim solution, Spacecom leased an orbiting satellite from AsiaSat to temporarily replace AMOS-6. Media outlets report that Spacecom was vague in its 25 September 2018 filing about what the government’s AMOS-8 decision means for Spacecom’s plans to replace AMOS-6.
“As the company has earlier reported, the company is promoting in the best manner the AMOS-8 satellite program. The company is examining the program’s feasibilities with several options, including potential joint efforts with the Government of the State of Israel,” Spacecom said, quoted in Space News.
According to the report, Spacecom has also notified SpaceX that it is terminating its contract for a 2020 launch of AMOS-8 aboard a Falcon-9 launch vehicle.