In 2002, a management consulting company that most people have not heard of, Futron, produced a report in 2002, ” Space Transportation Costs: Trends In Price Per Pound To Orbit 1990 – 2000“, which makes some, to say the least, interesting claims such as by 2021 “60 passengers may be flying annually, representing revenues in excess of US$300 million.” Wild claims aside, the 2002 Futron report has become the intellectual justification for the current effort by the White House to end our nation’s human space flight program in favor of a private human program.
There are three legs of the stool representing the White House plan to privatize human space flight. First, the Administration contends, as stated in testimony by NASA Administrator Charles Bolden, that the commercial launch sector will use their own capital, though with some help from NASA, to build new launchers and spacecraft to get Americans into low-earth orbit, the subject of this article. Additionally, the White House space plan is premised on the commercial sector launching astronauts more cheaply and just as safely as NASA’s current Ares I launcher and Orion spacecraft. Lastly, it is the Administration’s belief that the commercial sector will be able to do all of this before Ares I would have even had its first launch in 2015. The Obama Administration believes these three things because it believes that, based on the 2002 Futron study, there is a business model for commercial human space flight.
However, it seems that nobody sent the 2002 Futron report to United Launch Alliance (ULA), which operates Boeing’s Delta IV and Lockheed Martin’s Atlas V rockets, or to Lockheed Martin and Boeing, both of whom have lost hundreds of millions in the commercial launch business. Over the last week, “Lockheed Martin and Boeing, the aerospace giants with decades of experience working on America’s space program,” as reported by Kenneth Chang of the New York Times, “will happily sell rockets to carry astronauts into space [on a cost-plus basis], but the companies are leery about taking a leading role in President Obama’s vision for a revamped National Aeronautics and Space Administration.” More pointedly, “I don’t think there is a business case for us,’ John Karas, vice president and general manager of human spaceflight at Lockheed Martin, said about the Administration’s idea of commercially built space taxis. In an interview with Space News, United Launch Alliance Director of Business Development Andrew Aldrin commented, “Not surprisingly, we are a little reluctant to commit. But this wasn’t always the case. Just remember, it was about 10 years ago that we invested billions in EELV (Evolved Expendable Launch Vehicle) systems for a [satellite launch] market that frankly looked much more solid than the [human spaceflight] market we are looking at today.”
Why don’t Boeing and Lockheed Martin embrace the 2002 Futron study and rush to support NASA’s new commercial crew launch program? It could be that the lessons learned during the Evolutionary Expendable Launch Vehicle program, or more recently the bankruptcy of Sea Launch, are a reminder of the gap between policy studies by management consultants and reality.
Two decades ago, the space bubble began, fueled by the expectations rampant during that time that a huge commercial satellite market was on the horizon. During the 90’s, several start-up’s from Rocketplane, RotaryRocket, and Kistler tried to get off of the ground. In the end, all failed with Sea Launch the last to file bankruptcy in 2010.
Of all of the space bubble efforts to fail, the biggest failure was a program by the Pentagon to have commercial aerospace companies provide satellite launches. Beginning in 1994, the Evolved Expendable Launch Vehicle program, or EELV, was envisioned as a way for commercial space to lower the cost to the government of satellite launches. But by the time the 2000’s rolled around, and both Boeing and Lockheed Martin invested billions to develop the Delta IV and Atlas V respectively, it was clear that the burgeoning commercial satellite launch market envisioned at the start of the EELV effort was not materializing. Along with those evaporating expectations also went the hope for lower launch costs for the government’s payloads. Eventually, in 2006, with the Air Force’s encouragement, Boeing and Lockheed Martin entered into a joint venture called United Launch Alliance as a way of trying to save on launch costs. As mentioned by Tom Young during this testimony before the House Science & Technology Committee on March 24, 2010, neither ULA nor its two members are commercial satellite launchers.
To find a true commercial satellite launch company, one need only look to Sea Launch, a company currently under bankruptcy protection. From 1995 until last summer, Sea Launch, 40% owned by Boeing, was a full commercial satellite launch provider that launched Russian Zenit rockets from Odyssey, an offshore launchpad. On June 24, 2009, Sea Launch filed for bankruptcy protection. According to some reports, Boeing may loose upwards of $478 million before Sea Launch exists bankruptcy. In its filing, Sea Launch officials blamed the weak commercial launch industry, skyrocketing hardware costs, the credit crunch, and intense competition from other launch providers. Another reason was a 2007 dramatic launch failure that cost it customers. Sea Launch lost money every year since its first flight in 1999 and accumulated some $1.4 billion in losses before filing for protection under Chapter 11 of the U.S. bankruptcy code in mid-2009. One of the issues facing Sea Launch as its tries to exit bankruptcy in 2011 is raising capital. As noted by Sea Launch President Kjell Karlsen, “It’s a tough market, that’s for certain, and there aren’t a lot of Elon Musks around.”
Both the EELV program and Sea Launch should stand as a reminder that what looks good on paper, and Sea Launch’s ability to place its launchpad exactly where it needed to was a real competitive advantage from a launch and orbit dynamics perspective, does not always work out in the world we all live in. The refusal of ULA, the only satellite launch operator with the level of experience needed for launching human spacecraft, to pay for the development of its own spacecraft and larger rockets, should send a message to those in the Obama Administration who still believe the predictions of the 2002 Futron study of the potential of commercial human space flight. Someday commercial human space flight may come about, but that day is not now.
The AmericaSpace Team