European satellite sector needs to consolidate to compete with Musk, Leonardo exec says

FARNBOROUGH, England (Reuters) - The European satellite sector needs to consolidate in order to keep pace with Elon Musk's rapidly-expanding network of Starlink communications satellites, an executive at Italian aerospace firm Leonardo said on Tuesday.

"Thanks to Elon Musk and his team, Europe will have to evolve somehow. This evolution needs probably to take into account some form of consolidation," Lorenzo Mariani, co-general manager of Leonardo, told Reuters.

European aerospace groups Airbus and Thales, in which Leonardo holds a 33% stake, are exploring a tie-up of some space activities, including satellite activities, industry sources say.

Airbus and Thales are Europe's largest makers of satellites for telecommunications, navigation and surveillance.

Demand for their geostationary satellites is increasingly under pressure as traditional manufacturers face competition from massive constellations of expendable satellites in low Earth orbit, like the Starlink network built by Musk's SpaceX.

Mariani's comments echo those of Airbus CEO Guillaume Faury who said on Sunday that the company was looking to "create scale" in the satellite market.

(Reporting by Joe Brock; Editing by Peter Graff)