The global race to the moon just got a little more interesting. Elon Musk this week announced on X that SpaceX is shifting its focus from Mars to building a “self-growing” city on the moon. In his post, he explained that a lunar base could be achieved in under 10 years, whereas going to Mars would take more than 20 years. We must remember that, when founding SpaceX 25 years ago, Musk’s stated goal was to extend human life to Mars.
Why is this meaningful? 2025 witnessed a new record for orbital launches. SpaceX, with its Falcon 9 launch vehicle, holds an 82 percent share of the commercial market. SpaceX last year flew 165 missions, more than the rest of the world combined. In comparison, Arianespace conducted seven space launches, United Launch Alliance only six and Rocket Lab 18. But the global increase was also driven by China, which conducted 93 orbital launches. There is hence growing competition between the US and China, and Beijing has announced its goal to settle the moon. This is an important element in Musk’s shift.
The space landscape is also transforming. SpaceX’s foundation and early growth were built on massive US government support. Since 2015, it has accumulated more than $17 billion in federal contracts, with total government funding and commitments exceeding $20 billion. NASA contracts alone account for up to $14.6 billion of that total, with Space Force and Defense Department awards adding more than $5 billion. This government business has historically made up as much as 84 percent of SpaceX’s revenue.
There is growing competition between the US and China, and Beijing has announced its goal to settle the moon
Khaled Abou Zahr
However, Musk recently stated that NASA contracts will make up only about 5 percent of SpaceX’s revenue this year and that Starlink represents the future of its income. This means that SpaceX has become able to serve its own business needs more than other customers — even if future contracts from the federal government could go beyond $56 billion if all options are exercised.
The strategic shift toward commercial services, as stated by Musk, even though government funding remains important, becomes reality with the project to build settlements on the moon. Musk’s growing focus on artificial intelligence and large-scale computing infrastructure is reshaping his space ambitions. With SpaceX and xAI now merged, orbital data centers and massive energy systems in space are becoming key elements. The moon, with its low gravity and oxygen potentially accessible from its rocks, is better suited to industrial-scale construction than Mars. Concepts like a lunar “mass driver” could efficiently launch materials into orbit to build solar arrays, data centers and other large space-based infrastructure.
What is being witnessed is the birth of the orbital, or in-orbit, economy. This means we are at the dawn of a new age for space business and geopolitics. The moon is becoming a source of geopolitical competition, as countries and companies race to control satellites, orbital infrastructure and emerging space businesses.
Beyond traditional communications and observation, new sectors like in-orbit manufacturing, satellite servicing, transfer logistics, debris removal and space tourism are creating strategic and commercial advantages. Dominance in these areas not only pushes innovation but also strengthens national power and influence in an increasingly contested space environment. No need to mention the defense and security aspect here, as it is obvious.
The moon is poised to play a critical role in the development of the orbital economy, serving as a source of strategic resources and a hub for space operations. Its water ice is an important resource. The moon can enable cheaper satellite launches, orbital servicing and deep-space missions. It could also host research facilities, manufacturing platforms and logistics hubs that support activities in Earth orbit and beyond. Control over lunar locations, resources and infrastructure is becoming a key element of geopolitical competition, especially between China and the US.
Musk’s growing focus on artificial intelligence and large-scale computing infrastructure is reshaping his space ambitions
Khaled Abou Zahr
So, US federal investment returning to the moon under the Artemis program represents an interesting opportunity. The Artemis mission is aimed at a sustainable human presence and it has been estimated to have already cost about $93 billion. NASA Administrator Jared Isaacman has confirmed that the US aims to return to the moon during President Donald Trump’s second term.
Isaacman has often highlighted the opportunities on the moon, such as building bases, mining helium-3 for fusion power and investing in nuclear propulsion. NASA is collaborating with SpaceX, Blue Origin and Boeing under the Artemis program, funded by $9.9 billion from Trump’s One Big Beautiful Bill Act. Private companies are directly helping the US secure a foothold and gain defense, strategic and commercial advantages.
What sets the US apart from China is this unique ecosystem, in which private enterprise thrives alongside government support — a spirit that has allowed SpaceX to grow and innovate rapidly.
Even when initially fueled by government budgets, I believe that private sector competition tends to yield better results than a purely government-led and executed approach. A clear example of this dynamic is Blue Origin, which has begun making tangible progress with its New Glenn rocket and is going all in on lunar exploration. The company is developing crewed lunar systems that may not require orbital refueling, raising the possibility that Blue Origin could land humans on the moon before SpaceX.
Just as the US once expanded westward through a mix of government support and private enterprise, today a new race to the moon is unfolding with the same competitive spirit and the supreme goal of keeping America in the lead.
BY: Khaled Abou Zahr is the founder of SpaceQuest Ventures, a space-focused investment platform. He is CEO of EurabiaMedia and editor of Al-Watan Al-Arabi.
Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect The Times Union‘ point of view
