Airbus, Thales and Leonardo’s hopes of forging a new European space champion faces a near three-year wait, raising questions over the continent’s ability to compete in a rapidly evolving sector upended by Elon Musk’s SpaceX.

Talks between the European aerospace group and the French and Italian companies started last year about merging their space operations into a jointly held company spanning satellite making, space systems and services. They estimate the combination would have revenues of about €5bn a year, according to a recent French parliamentary report.

But several people close to the talks told the Financial Times that if agreement was reached by the end of this year, regulatory and political scrutiny meant the combination was unlikely to launch before 2028.