In Europe, which saw the formation of a new European economic union and the introduction of a unified monetary system, the Euro, at the beginning of the year, government funding for space projects in 1999 declined to a low level, particularly in France and Germany, the major member nations of the European Space Agency (ESA).
For the European aerospace industry, history was made on 10/14 in Strasbourg when the merger of France's Aerospatiale Matra, itself previously formed by merger of Aerospatiale and French/British Matra Marconi Space, and Germany's DaimlerChrysler Aerospace (DASA) was formally agreed, laying the foundation for the European Aeronautic Defence and Space Company (EADS), Europe's new industry leader. DASA itself had emerged in 1998 by fusion of Daimler-Benz Aerospace (originally merged from Daimler-Benz, Dornier, MBB-Erno, MTU and TST) with Chrysler. In December 1999, EADS was further enlarged when Casa of Spain (Construcciones Aeronáuticas S.A.) became the third founding member. Employing a total of 96,000 and generating a joint turnover of $20 billion, EADS will belong to the "top three" high-tech aerospace and defense companies in the world (behind Boeing and Lockheed Martin).
In the launch vehicle area, its market leader, Arianespace (EADS share: 25.9%) continued to operate a successful series of nine Ariane 4 launches, one less than in 1998 (due to satellite delivery delays similar to 1998's payload problems involving mostly technical glitches), carrying ten commercial satellites for customers such as India, Korea, France and England. At year's end, the Ariane 4 had flown 122 times, with seven failures (= 94% reliability) from its Kourou/French Guyana spaceport.
The most significant event for ESA, the European intergovernmental organization comprising 14 member nations, in 1999 was the first commercial launch of the Ariane 5 heavy-lift booster, but carrying a government payload, ESA's x-ray observatory XMM. The launcher had originally been assigned to the Telkom 1 satellite, but this payload had to be switched to an Ariane 4 because of technical delays of the satellite.
The European Commission (EC) in 1999 announced its recommendation for Europe to develop its own global satellite navigation system GNSS-2, now called "Galileo", as a public-private partnership with industry contributing up to half of the estimated cost of $2.5 - 3.3 billion.
In the human space flight area, the declining interest by Germany and France (unlike Italy's) in this field, voiced for example at the ESA ministerial council meeting in May in Brussels, continued in 1999. While the International Space Station ISS remains ESA's biggest single ongoing program and its only engagement in the human space flight endeavor, European ISS contributions remain unchanged due to top-level agreement signed by previous governments of the participating nations. Germany's space budget, under the current administration, is expected to remain essentially flat at around 1.6 billion D-Mark ($850 million). Most of it, about 1 billion D-Mark, is absorbed by ESA programs, and about half of that contribution will have to be spent on the International Space Station (ISS) as the station begins operations in 2003-04. Support for scientific research in Europe to prepare for the ISS continues to erode, with declining budget trends.
X-ray Multi Mirror (XMM) Observatory. The largest European science satellite ever built, the XMM was launched on the Ariane 5 on 12/10 from Kourou. A high-stakes mission for the European space community, the deployment of the large telescope to an initial orbit of 113,946 x 850 km (71,216 x 531 s.miles) inclined at 40 degrees to the equator went off flawlessly. Later, the spacecraft used its hydrazine thrusters to boost its perigee (low-point) to 7000 km (4375 s.m.). The telescope, Europe's equivalent of NASA's Chandra x-ray observatory, has a length of nearly 11 m (36 ft.), with a mass of almost 4 metric tons (8,800 lbs.). It was built by a team led by DASA at a cost of close to $700 million including launch (Chandra: $2.78 billion, including Shuttle launch). XMM carries three advanced telescopes, each housing 58 high-precision, wafer-thin concentric mirrors designed to detect millions of hitherto invisible x-ray sources. The observatory's three scientific instruments - a photon imaging camera, reflection grating spectrometer, and optical telescope - will allow XMM not only to image superhot x-ray sources but also to distinguish their "color" (temperature).