Morgan Stanley Says China’s Reusable Rocket Progress Poses Long-Term Challenge to SpaceX

Morgan Stanley believes China's rapidly advancing reusable rocket program represents the biggest long-term competitive threat to SpaceX, following the country's first successful recovery of an orbital-class rocket booster.

The investment bank said the China Aerospace Science and Technology Corp. (CASC) achieved a major milestone by recovering the Long March 10B booster, making it only the third organization after SpaceX and Blue Origin to accomplish the feat. While the demonstration marks significant progress, Morgan Stanley noted that China must still prove it can repeatedly launch, recover, and reuse rockets before establishing a fully operational reusable launch system.

According to the brokerage, China's expanding space industry—supported by both government-backed programs and private companies such as LandSpace, Galactic Energy, and Space Pioneer—has become the most serious long-term rival to SpaceX's launch business. The country completed 90 orbital launches in 2025, second only to SpaceX's 165 Falcon 9 missions, highlighting its growing presence in the global space sector.

Morgan Stanley also pointed to earlier assessments from the U.S. Space Force, which estimated China was still three to five years away from mastering reusable rocket technology. However, the successful Long March 10B recovery could accelerate that timeline and strengthen China's position in the commercial space race.

Beyond launch capabilities, China continues expanding its ambitions in satellite infrastructure. Planned low-Earth orbit constellations, including the Guowang and Qianfan projects, aim to deploy roughly 28,000 satellites, while an additional proposal seeks authorization for more than 190,000 non-geostationary satellites.

The brokerage also highlighted China's investment in space-based computing, citing the launch of the first satellites for its planned 2,800-satellite "Star Compute" orbital supercomputer network.

Despite increasing competition, Morgan Stanley maintained its Overweight rating on SpaceX with a $300 price target. Analysts said the company continues to lead the industry through its unmatched launch frequency, proven reusable rocket technology, and Starlink satellite connectivity. However, the firm cautioned investors not to underestimate China's accelerating technological progress as it works to narrow the gap with the world's leading commercial space company.