SpaceX says there’s ‘no intent’ to take over Verizon’s $2.4 billion FAA contract

SpaceX on Wednesday denied that it’s looking to take over a $2.4 billion Federal Aviation Administration (FAA) contract. Instead, Elon Musk’s company thinks its Starlink can support Verizon’s (VZ-0.20%) modernization efforts.

In 2023, the FAA awarded Verizon a contract to upgrade its telecommunications networks, which are necessary to oversee 20 million square miles of U.S. airspace and ensure flights are safe. The current, aging, network was created and is maintained by defense contractor L3Harris Technologies (LHX+1.93%).

Musk last month claimed that the current system used by air traffic controllers is “breaking down very rapidly” with “single digit months to catastrophic failure.” At the time, he also promoted SpaceX’s Starlink subsidiary as an alternative.

SpaceX said Wednesday that it is working with L3Harris and the FAA to test the implementation of Starlink’s satellite internet terminals to help upgrade the system. The Hawthorne, California-based company said it signed a loan agreement with L3Harris to provide Starlink kits and service “free of charge for an initial testing period.”

Some 4,000 Starlink terminals were sent to the FAA last month to hasten an upgrade at the FAA. Terminals have been installed at the FAA’s air traffic control technology hub in New Jersey, as well as a facility in Oklahoma City, while a terminal went online at Birchwood Airport in Alaska last month, according to Bloomberg News.

Both Bloomberg and The Washington Post reported that FAA officials were deciding whether to cancel Verizon’s contract entirely. SpaceX says that won’t be happening.

“Starlink is a possible partial fix to an aging system,” SpaceX said in a statement posted to Musk’s X. “There is no effort or intent for Starlink to ‘take over’ any existing contract.”

According to Bloomberg, members of President Donald Trump’s “inner circle” had discussed using Starlink to modernize the FAA’s systems during his transition to the White House. Then, just days after Trump’s inauguration, a catastrophic plane crash killed 67 passengers and crew members.

Following that event, and several others, Transportation Department Secretary Sean Duffy said improving the U.S. air traffic control system is a priority. As part of that effort, he brought on SpaceX engineers to give advice and discuss modernizing the system.

“It’s part of the solution,” Duffy told Fox News on Tuesday, emphasizing that Starlink’s terminals are ideal for areas where it’s difficult to install fiber wires, such as mountains in Alaska.

Verizon seems to agree. Executive Vice President Joe Russo recently said its planned network — which he said will be operational “shortly” — could work with Starlink.

“All I know is if they are testing … I think that can be complementary to what we’re trying to build to really run the FAA infrastructure,” he said on Feb. 25 at a conference.