WASHINGTON — A new report from supply-chain intelligence firm Altana quantifies the extent to which the U.S. commercial space industry remains dependent on components sourced from Chinese suppliers. At the same time, space companies face mounting pressure to reduce reliance on foreign suppliers viewed as security risks by the Pentagon.
In an analysis released May 20, Altana said that since 2022 more than 849,000 commercial space imports had exposure to Chinese suppliers at the third tier of the supply chain or further upstream. Another 15,000 imports included Russian-origin components in their product value chains, according to the report.
The report also found that 26.8% of semiconductor-related imports tied to the commercial space sector had direct or near-upstream exposure to Taiwanese manufacturers.
The findings come as supply-chain resilience has become a concern across the U.S. space industry, particularly as the Pentagon increasingly relies on commercial satellite operators, launch companies and other private-sector suppliers for national security programs.
The industry in recent years has been challenged to secure access to radiation-hardened semiconductors, specialty metals, propulsion components and other highly specialized parts that can take years to qualify for use in space systems.
Defense agencies, meanwhile, have intensified scrutiny of hidden dependencies on Chinese manufacturing several layers upstream from prime contractors. Even when spacecraft are assembled domestically, key materials, subcomponents and manufacturing processes may still trace back to Chinese suppliers.
The Pentagon’s demands to reduce reliance on so-called adversarial supply chains have created tension between globally sourced commercial supply networks and defense procurement rules emphasizing trusted domestic or allied suppliers.
Against that backdrop, Altana’s report says defense agencies are trying to gain visibility into lower-tier suppliers and identify dependencies.
Altana markets its software platform to defense agencies seeking a shared operating environment for collaboration with industry on supply-chain monitoring. The company uses artificial intelligence to build multi-tier maps of global supplier networks using public and private trade data.
Supply chains analyzed
For the report, Altana analyzed supply chains tied to 299 U.S. commercial space contractors, subcontractors and major suppliers, examining import transactions and upstream supplier relationships dating to 2022. The company said the analysis relied on what it described as “AI-surfaced risk signals.”
The report said the vulnerabilities are concentrated in specialized components that are difficult to replace, including radiation-hardened semiconductors used in satellites and spacecraft, space-grade rubber seals and coatings, and structural metal components such as aluminum ducts, fasteners and rivets.
“Component-based tariffs on steel and aluminum content, combined with the adversarial upstream exposure identified in the analysis, could create compounding compliance and cost challenges for space contractors,” the report said.
The report highlights reliance on Taiwan for advanced semiconductor manufacturing as a separate vulnerability. According to Altana, many of the radiation-hardened chips used in spacecraft control systems, scientific instruments and satellite communications trace back to Taiwanese fabrication facilities.
A conflict involving Taiwan could disrupt production of space-grade semiconductors that are difficult to replace because they require specialized fabrication processes, extensive testing and years-long certification cycles. Altana said some defense agencies are using supply-chain mapping and wargaming tools to model disruptions that would result from a Chinese invasion of Taiwan.
