By Akash Sriram

Jan 15 (Reuters) - Funding in the space industry is set to receive a boost this year from growing U.S.-China tensions, after startups in the sector clocked $8.6 billion in investments in 2024, according to a report by investment firm Seraphim Space.

China has been increasing its efforts to go toe-to-toe with Western countries in sectors such as satellite production and rocket launches to supplement the growing need for space-based imaging, intelligence and data.

"This will very likely continue to drive investment towards the capitally intensive sectors of the space industry in the year ahead," said Lucas Bishop, Investment Associate at Seraphim Space.

Notable deals in the fourth quarter of 2024 included Apple's AAPL.O acquisition of a 20% stake in satellite operator Globalstar GSAT.A for $1.5 billion and a $1.25 billion secondary sale of SpaceX shares, which boosted the company's valuation to $350 billion from $210 billion earlier in the year.

Firefly Aerospace's $175 million late-stage funding round in November was the largest deal in the fourth quarter, valuing the Texas-based rocket maker at over $2 billion.

The space sector is likely to receive a boost from SpaceX CEO Elon Musk's influence over the incoming Donald Trump administration as well as billionaire entrepreneur and private astronaut Jared Isaacman being tapped to lead NASA.

If confirmed, the Shift4 Payments FOUR.N founder and CEO would oversee the space administration's $25 billion budget and future missions.

"A reallocation of funding toward more cost-effective, private-sector solutions could further boost investment in companies offering other space technologies across the board," Bishop added.

The rivalry between China and the United States is likely to intensify after Trump takes office next week, bolstered by the Department of Defense's expanded Commercial Space Program funding, Seraphim Space said.

(Reporting by Akash Sriram in Bengaluru; Editing by Krishna Chandra Eluri)

((Akash.Sriram@thomsonreuters.com; On X as @HoodieOnVeshti; +91-74116-87774;))