The Space Economy Is Creating a Supply Chain for Factories in Orbit

The space industry is a billion-dollar business and putting equipment into orbit is just a part of it. The most difficult part starts after launch: running a factory, material supply, equipment maintenance and delivering finished products to customers.

The commercial opportunity extends beyond manufacturing products in space to build supply chains, maintenance services and delivery systems, which are needed to make orbital factories commercially viable as companies look to use microgravity to produce pharmaceuticals and advanced materials.

Space startups secured a record $20.8 billion in funding in the third quarter of 2026, according to a recent Reuters report. Much of the money was invested in infrastructure for launch and space access, as investment in systems that enable the expansion of the commercial space economy grew.

But more rockets doesn't necessarily mean more successful space factories. To achieve the orbital manufacturing goals of scale, a company needs to have the equivalent of an industrial supply chain—from suppliers to spacecraft, maintenance services, energy systems, and customers on Earth.

Early experiments offer a glimpse of this possibility. Helogen announced October missions, including work with LambdaVision, to manufacture protein material for a potential artificial retina. LambdaVision says nine previous International Space Station (ISS) missions have helped demonstrate the potential of microgravity for producing its multilayer protein films.

The next question is whether such experiments can become replicable production processes.

Factories that do not depend on astronauts

For years, microgravity research has largely relied on the ISS. Access to crew time, facilities and mission schedules can limit how frequently companies conduct experiments. Commercial manufacturing will require a more flexible approach.

Halogen CEO and founder, Shishir Bankapur, believes the industry needs autonomous facilities that can operate for extended periods and be managed from Earth.

"The industry needs factories that can operate autonomously, share data and updates in real-time, and let teams watch telemetry and adjust protocols from the ground," Bankapur told International Business Times.

Helogen is developing an infrastructure model that combines manufacturing equipment, autonomous operations, spacecraft and power and thermal-management systems. Its planned Keystar platform is designed to supply up to 50 kilowatts of power to payloads, with full operation targeted for 2028, according to the company.

A major limitation for Bankapur is not only the ability to launch manufacturing equipment into space, it is also the energy that it needs to operate those devices and dispose of the heat.

As production volume grows, power and cooling could represent potential bottlenecks. If a shared orbital power-and-cooling layer were in place, the executive claims, it could enable several manufacturers to share infrastructure rather than having their own full system.

The idea makes commercial sense in principle. The harder part is demonstrating that the infrastructure can deliver reliable output at a cost customers are prepared to pay.

Launch is only the beginning

If a factory is in orbit, it has no choice but to rely on its own on-orbit resources and services, rather than on a technician arriving the next morning, or a replacement part being delivered by truck.

AstroAgency's founder, Daniel Smith, believes orbital manufacturing plans should give much more consideration to modularity and long-term serviceability.

"As we're going to scale up to have factories in space, and make space manufacturing commercially viable, we need to solve some basic problems so that manufacturing does not come to a halt because we don't have enough resources, or equipment failure, or something else," Smith said to International Business Times.

If a component fails, it would be easier to replace a single component in a modular system, rather than a complete spacecraft. Standardized parts may also decrease the need for costly one-off servicing trips.

Smith outlines three issues that he believes need addressing: launch cadence, orbital logistics cadence, and re-entry cadence.

On earth, factories rely on regular supplies of raw materials and a reliable line to market for their products. An orbital factory will require the same regularity of supply; there must be reliable docking and undocking systems capable of moving material and picking up manufactured products.

Reusable launch vehicles could reduce transport costs, Smith said, but lower launch prices alone will not solve the problem. More frequent launches and cheaper in-orbit logistics will also be necessary.

Europe is developing part of this supporting infrastructure. On September 10, the European Space Agency awarded The Exploration Company a service contract under its ALADDIN commercial cargo-return program, which aims to help establish independent European transportation capability to and from low Earth orbit.

The economics of keeping a factory running

Transportation is only one part of the equation. Equipment failure could be particularly costly if replacing a component requires another launch or a dedicated servicing mission.

Ricardo Román, Chief Strategy Officer at Fracttal, sees asset management and predictive maintenance becoming essential as orbital systems grow more complex.

"Reliability becomes an economic factor, not merely a technical one," Román told International Business Times.

Regularly checking equipment conditions, predicting failures, and prolonging the life of equipment might allow manufacturers to minimize equipment downtime and unnecessary replacement missions. The concepts are known in industry on the ground but may be much costlier in orbit.

Specialized space companies will join the existing industrial companies that already have expertise in areas such as maintenance planning, asset tracking and operations optimization. The process of developing high-tech machines is not only about creating the machine itself; it is equally important to ensure its dependability for the entirety of its operation.

The supply chain extends beyond the launch pad. Earth-observation data could be used to track resources and transportation systems that support an orbital production system, says June McAlarey, CEO of CATALYST (operating as PCI Geomatics).

Satellite images can be used to monitor mineral extraction, environmental damage and safety at raw-material extraction sites. Geospatial analysis can also detect traffic jams, road closures and other issues that may impact delivery.

During the conversation, McAlarey said that geospatial intelligence may evolve into a kind of digital infrastructure for the space economy, akin to the way mapping and location data are used to assist land-based companies on a daily basis with logistics and asset tracking.

The commercial test still lies ahead

For all the investment and technical progress, one central question remains: can orbital manufacturing work as a business, not just as an experiment?

Smith was blunt when asked about the industry's biggest unproven economic assumption.

"That it works," he said.

His point reveals the core problem. Producing a material in space once is not the same as manufacturing it repeatedly to consistent quality standards, replacing the worn parts, delivering the product and selling it at a price that covers the entire process.

NASA is planning for a more commercial future in low-Earth orbit as it looks beyond the ISS, which will continue operations until 2030. Its in-space production program supports efforts to advance technologies from early demonstrations toward commercial production.

That transition could open opportunities for companies supplying power systems, thermal management, maintenance, cargo transport and Earth-observation analytics.

The first successful orbital factories will need more than scientific breakthroughs. They will need suppliers that can deliver on schedule, dependable equipment and transportation systems that can reliably bring products home.

The next major milestone in the space economy may not be another spectacular launch, but rather the quieter achievement of keeping a factory supplied, maintaining production and returning a product that a customer wants to buy.