A Chinese satellite‑internet company that has reported consecutive annual losses announced this month a major industrial bet: a roughly 2.8 billion yuan aerospace project in Suzhou, Anhui, that will combine rocket manufacturing, a radar‑sensing and compute satellite constellation, and plans for a wider space‑services ecosystem.
The signing ceremony on 16 January formalised an initial phase of about 1.2 billion yuan, split evenly between a LOX‑methane launch vehicle manufacturing base to mass‑produce the Houyi‑1 (HY‑1) family and the development and launch of a “compute + radar remote sensing” satellite constellation designed to interoperate with the company’s planned Nuwa constellation. Company executives and local officials described the long‑term intention as building a closed industrial loop — from satellite manufacture and constellation deployment to commercial data and space compute services.
The project complements a recently commissioned assembly and manufacturing facility in Hebi, which occupies about 20,000 square metres and is equipped for final assembly and high‑precision testing of liquid launch vehicles. That plant is already working on the HY‑1 medium liquid rocket for sun‑synchronous orbits and its up‑scaled, bundled heavy variants as well as a planned reusable HY‑2 family. Once scaled, the Hebi base and the Suzhou programme together are said to support an annual output of around 20 rockets.
Market expansion is part of the company’s pitch: it has already launched high‑resolution commercial radar satellites in the Nuwa series, completed a 12‑satellite cluster of the Hongtu‑1/2 family, and is pursuing overseas sales and partnerships, including a nearly 1.0 billion yuan ground‑and‑satellite deal with an unnamed African country and a 2.9 billion yuan strategic accord with Pakistan for satellite internet services.
The industrial ambition comes against a sharp financial warning. The company has recorded significant net losses in recent years — roughly 374 million yuan in 2023, 1.393 billion yuan in 2024 and 366 million yuan in the first nine months of 2025 — and it expects losses to persist through 2025. That raises questions about how the heavy capital costs of new manufacturing lines and satellite launches will be funded and the extent to which regional authorities, partners or state actors will be enlisted to share the burden.
The Suzhou investment and Hebi factory underscore two broader trends in China’s commercial space sector: growing vertical integration among private satellite operators who want control of both the spacecraft and launch supply chains, and a push for higher cadence, lower‑cost launch services via modern LOX‑methane engines and scalable production. For international customers, an emerging Chinese capability to mass‑produce radar satellites and offer bundled launch and ground services may widen the choices for imagery and connectivity, but also raises geopolitical and export‑control sensitivities.
For investors and competitors, the chief risk is timing and capital. Ambitious production targets and constellation roll‑outs require sustained cash flow before commercial revenues from imagery, data services or international contracts can scale. The company’s overseas deals show market potential but may be constrained by financing terms, delivery schedules and the political environments of partner countries. If the firm can execute factory throughput, reduce unit costs and secure steady demand for launches and data services, it could become a meaningful player in the regional commercial launch and Earth‑observation markets; failure to do so would compound its current losses and may force consolidation or rescue options.
The announcement therefore matters beyond one corporate transaction. It signals that Chinese private firms are moving from artisanal launch projects to industrialised, high‑frequency production models. That shift will shape capacity in low‑Earth orbit services, alter competition among launch providers, and influence how governments and commercial customers weigh procurement, security and dependence in satellite imagery and communications.