Air Force weighs plan to cancel SDA’s next set of data relay sats in favor of SpaceX: Sources

SDA’s Tranche 1 launches are now anticipated to begin in summer 2025, starting with satellites for the Transport Layer. (Image courtesy of Northrop Grumman)

WASHINGTON —The Department of the Air Force is considering a plan in which the Space Development Agency (SDA) would cancel upcoming competitions for its future Transport Layer satellites in favor of tapping SpaceX to provide the capability to rapidly transmit large amounts of data around the globe, two sources told Breaking Defense.

The potential shift, part of the 8 percent budget drill ordered by Defense Secretary Pete Hegseth, was recommended by the Space Force in order to protect the service’s other high-priority efforts, according to one industry and one government source.

The issue came to light Thursday in a Senate Armed Services Committee hearing, when Sen. Kevin Cramer, R-N.D, raised concerns about such a proposal to the Trump administration’s nominee for Air Force secretary, Troy Meink.

Cramer asked Meink if he thought the move would be a good idea given potential negative effects on smaller “innovators” in the space industrial base. Meink replied that he was unaware of such discussions at the Pentagon, but would be “diving into” the recommendations and making an assessment of “where they’re going” should he be confirmed.

Cramer’s office did not respond to a request for additional information as of press time, nor did SpaceX immediately respond.

An Air Force spokesperson told Breaking Defense today that no decisions had yet been made about SDA’s funding for future Transport Layer satellites.

“The Department of the Air Force (DAF) and the United States Space Force (USSF) are collaborating with the Office of the Secretary of Defense to evaluate all acquisition programs in the context of FY26 President’s Budget deliberations and the Administration’s priorities,” the spokesperson said. “No decisions have been made on Tranche 2 and 3 of the Transport Layer of the Proliferated Warfighter Space Architecture.”

SDA has been acquiring the Transport Layer data relay satellites, which the Defense Department has said will form the “backbone” of its Joint All Domain Command and Control (JADC2) sensor-to-shooter network, in increments, called “tranches,” with each batch to include improved capabilities.

The agency in December 2023 finished launching 19 Tranche 0 experimental versions; it now intends to launch its first operational set of 126 Tranche 1 Transport Layer satellites late this summer.

The agency also has issued contracts for 200 Tranche 2 Transport Layer birds to four contractors, Lockheed Martin, Northrop Grumman, York Space Systems and Rocket Lab. SDA is recompeting its Tranche 2 Transport Layer award to Tyvak Nano-Satellite Systems (now owned by Lockheed Martin) following a lawsuit by Viasat.

It is unclear whether the Air Force proposal involves canceling the contracts for Tranche 2, or only affects the next-generation Tranche 3 birds that have yet to be be contracted out. Canceling current contracts is a much bigger challenge, and also would incur termination costs. SDA is in the midst of planning the acquisition of 140 Tranche 3 Transport Layer satellites in three different configurations, currently slated to begin launching in 2028. SDA in January put out a draft solicitation for 40 of the first variant, called Upsilon, asking for industry responses by Feb. 10.

SpaceX up to now has not been awarded any SDA contracts to provide Transport Layer satellites, although it did win a contract for four Tranche 0 Tracking Layer of missile tracking satellites in 2020.