Galactic Energy secures $336 million, nears debut of new reusable and solid rockets

SYDNEY — Beijing-based Galactic Energy has raised what appears China’s largest disclosed round for a launch startup as it nears orbital test flights of new rockets.

The company, full name Beijing Galactic Energy Aerospace Technology Co., Ltd., announced Series D financing of 2.4 billion yuan ($336 million) in a statement Sept. 28. The funding will be used for the Pallas series of reusable liquid propellant launchers and the Ceres-2 solid rocket, both of which appear close to test launches. The investment will also go towards related production, testing and launch facilities.

Galactic Energy, founded in February 2018, has established a strong record of reliability with its light-lift Ceres-1 solid rocket and previously raised $154 million in C round funding in late 2023 for its Pallas-1 plans. Pallas-1, a kerosene-liquid oxygen rocket, is to be able to carry 7,000 kilograms of payload to a 200-km low Earth orbit (LEO), having previously been stated to be 8,000 kg. 

New plans for Pallas-2 envision a capability of 20,000 to 58,000 kg, depending on a single stick or tri-core configuration, with an aggressive target of a debut launch in 2026, the company announced in August.

The investors appear to consist mainly of a mix of government-backed funds, municipal or district investment platforms, regional funds and industry-oriented funds. These include the Beijing Commercial Spaceflight and Low-Altitude Economy Industry Investment Fund and Sichuan Industry Revitalization Investment Group, among other investors from Sichuan province. 

This indicates strong state and provincial support and a strategic focus; a trend in Chinese funding rounds which has increased since the central government designated commercial space as a key strategic industry for growth.

The new round follows a number of large funding rounds for Chinese commercial launch startups in the past year which have featured strong involvement and support from local and provincial governments. Landspace, Space Pioneer and Orienspace are among those to have recently secured significant investment.

This trend is developing despite an apparently already crowded and competitive market, even as new entrants continue to emerge, targeting newer trends in launch. Large levels of investment are also beginning to appear in other areas of the commercial space sector.

Pallas-1 second stage static fire

Galactic Energy also announced Sept. 28 a successful static fire of the second stage of the Pallas-1 rocket. The test was conducted near Chizhou city in Anhui province and lasted just over 220 seconds. It marks a step towards a first orbital test flight of the Pallas-1. A first stage hot fire test is yet to be conducted.

Previous Chinese media reporting suggests the rocket will be transported to the national Jiuquan spaceport, northwest China, around November, ahead of a test launch from dedicated facilities at Jiuquan’s Dongfeng Commercial Space Innovation Experimental Zone.

Galactic Energy specifically stated that it received strong guidance from units such as the State Administration of Science, Technology and Industry for National Defense (SASTIND) for the test. This follows the China National Space Administration (CNSA), which operates under SASTIND, this year moving to tighten quality oversight over commercial space projects, which followed a near-disastrous static fire incident involving commercial firm Space Pioneer in June 2024.

Ceres-2 assembled

Galactic Energy also separately announced the final assembly and testing of its new Ceres-2 solid rocket Sept. 28. Launch will now take place “at an appropriate time” in the near future, according to the company, and will carry six satellites.

The rocket is an upgraded version of the Ceres-1. While the Ceres-1 can carry 400 kg to LEO or 300 kg to a 500-km SSO, the Ceres-2 will have a payload capacity of 1,600 kg to 500-km LEO, and 1,300 kg to 500-km SSO, according to Galactic Energy. The rocket was earlier slated for a test flight in the first half of the year.

Galactic Energy is—especially with the Pallas rocket series—and along with a range of competitors, aiming to secure contracts such as those with the Guowang national broadband megaconstellation project, which is beginning to become a significant portion of China’s growing level of launch activity and a clear driver of China’s commercial launch ambitions.