On Wed., March 5, SpaceX CEO Elon Musk and United Launch Alliance (ULA) CEO Michael Gass both testified at a hearing on National Security Space Launch Programs before the U.S. Senate Appropriations Subcommittee on Defense. The hearing had a focus on the Evolved Expendable Launch Vehicle (EELV) program, and both Musk and Gass delivered their sales pitches to the Appropriations Committee as to why their company’s launch services are the best choice for sending sensitive tax-payer Department of Defense satellites into orbit.
For almost eight years ULA has owned the market as the sole launch provider for the Department of Defense, delivering an impressive 100 percent mission success over 68 launches with the company’s workhorse Delta-IV and Atlas-V launch vehicles. The company, a joint venture between Lockheed Martin and Boeing formed in late 2006, has launched billions of dollars worth of satellites and spacecraft for the DOD and NASA, but over the last several years overall launch costs have more than doubled annually to $1.6 billion.
That sobering fact could, however, change dramatically if SpaceX and Elon Musk have their way.
“The safety record of the Atlas-V and Delta-IV rockets made by ULA is remarkable, but we do have some concerns about the acquisition strategy, cost, and future of that program,” said Illinois Senator and panel chairman Richard Durbin. “From 2011 to 2014 the amount the Air Force budgeted, for an average of six satellite launches per year, grew by 60 percent. There are many answers as to why the program became more expensive, but the important question is what should we do about it? Over the last three years the Air Force has tried to control costs by stabilizing ULA production with a block buy of 36 rockets while fostering competition from new entrants such as SpaceX. The subcommittee needs to better understand the cost of the current program, how to ensure competition is fair and presents the best value to the government, and whether we need to do more to ensure we can deliver satellites on orbit in the most efficient and affordable manner.”
Durbin added: “Can the Pentagon learn to live with only one major supplier of rockets by better managing that industrial capability, with smarter buying and better negotiating? Or should the Dept. of Defense be more forward-leaning and embrace companies that challenge the rules on how we normally run defense programs?”
ULA’s reliability is unquestionable; there is no doubt they can get the job done, quickly, but Musk and SpaceX claim they can save the government and U.S. tax payer a whopping $300 million—per launch—a cost savings which, in many cases, would pay for both the launch and satellite combined, according to Musk.
“The Air Force and other agencies are simply paying too high a price for launch, and prices have risen to unsustainable levels,” said Musk. “SpaceX was founded to make radical improvements to space transport technology, with particular regard to reliability, safety and affordability. If you took something like a GPS satellite, which is about $140 million, you could actually have a free satellite with our launch, because our launch plus the satellite would cost less than just their launch – which is an enormous difference. Had SpaceX been awarded the missions ULA received under its recent non-competed 36 core block buy we would have saved the tax payers $11.6 billion dollars.”
Musk was not shy about pointing out ULA’s use of Russian hardware, which—in light of recent events across the Pacific—he believes could potentially cause problems to America’s ability to launch national security payloads should U.S./Russian relations deteriorate.
“Our Falcon launch vehicles are truly made in America, designed in California and Texas, with key suppliers spread across the country, and we launch from either Vandenburg Air Force Base or Cape Canaveral Air Force Station,” said Musk. “This stands in stark contrast to the ULA’s most frequently flown vehicle, the Atlas-V, which uses a Russian main engine and where approximately half the airframe is manufactured overseas. In light of Russia’s de facto annexation of the Ukraine’s Crimea region and the formal severing of military ties, the Atlas V cannot possibly be described as providing ‘assured access to space’ for our nation when supply of the main engine depends on President Putin’s permission. Given this development, it would seem prudent to reconsider whether the 36 core uncompeted, sole source award to ULA is truly in the best interests of the people of the United States.”
Gass countered by noting the fact that ULA has a two-year supply of those Atlas-V RD-180 engines stockpiled to minimize potential supply disruptions. According to Gass, ULA also has the blueprints and specifications for the engine, and even developed significant engineering and manufacturing capability which ultimately demonstrated the capability to co-produce the RD-180 domestically.
Gass and ULA emphasized their proven reliability during the hearing and—although welcoming the Air Force’s new acquisition strategy to reduce costs and introduce competition—made sure to highlight their concerns to opening the market to multiple launch providers.
“I believe there are substantive questions about how EELV competitions will be structured to ensure the competition is fair and open and whether it will actually deliver savings to our nation,” said Gass. “Ultimately, the central question is whether savings from competition will be sufficient to offset the cost of duplicating existing capabilities. ULA was formed to enable assured access to space with two separate launch systems, with recognition that the market demand was insufficient to sustain two competitors. We went from two competing teams with redundant and underutilized infrastructure to one team that has delivered the expected savings of this consolidation. We are investing in new technology and concepts to make our products better and more affordable. We are investing internal funds to develop a capability to launch two GPS satellites at a time which will cut launch costs almost in half.
“I believe leveraging the demand from the commercial sector is smart, but relying on commercial demand to enable national security carries huge risks, both to the rocket supplier and to its government customers,” added Gass. “ULA’s Atlas V and Delta IV rockets are the most powerful and most reliable in the world. They are the only rockets that fully meet the unique and specialized needs of the national security community. I believe the EELV program has been a major success for the nation. We will continue to provide the assured access the nation needs to deliver critical capabilities to orbit reliably and on-schedule.”
Orbital Sciences Corporation, another established American aerospace company operating their own fleet of rockets and spacecraft, was not present at the hearing to earn a right to compete for future military launch contracts, probably because Orbital currently holds their own $1.9 billion contract with NASA to carry out eight commercial resupply missions to the ISS, the first of which launched on Jan. 9, 2014 (the second launch for NASA, the first being a demonstration flight to secure the contract). Not only is Orbital already carrying out missions for NASA with their own Antares rockets and Cygnus spacecraft, but they also already have their own contracts to build satellites AND launch them for the Dept. of Defense, but on a smaller scale (the company offers small- and medium-class launch services).
“Orbital’s team is absolutely focused on offering the most reliable and cost-effective launch systems to our government customers for their important space missions,” said Ron Grabe, Orbital’s Executive Vice President and General Manager of its Launch Systems Group, in a statement following the company’s successful launch of the ORS-3 mission for the Department of Defense Operationally Responsive Space Office in Nov. 2013. “This dedication and teamwork with the Air Force has resulted in achieving 25 consecutive successful missions since 2000. We look forward to continuing this collaboration under the OSP-3 contract in the years ahead.”
As stated on Orbital Science’s website, “Under the Orbital/Suborbital Program (OSP), which is managed by the Air Force Space and Missile Systems Center’s Space Development and Test Directorate (SMC/SD) Launch Systems Division (SMC/SDL) located at Kirtland Air Force Base, New Mexico, Orbital designs, integrates, tests and provides space launch services with the Minotaur I, IV, V and VI rockets, as well as other suborbital capabilities with the Minotaur II and III configurations. Orbital’s use of standardized avionics and subsystems, mature processes and experienced personnel make Minotaur rockets both reliable and cost-effective for U.S. government customers.”
SpaceX has proven they can deliver payloads to orbit for both NASA and private companies alike; the company currently holds a $1.6 billion contract to launch at least 12 resupply missions to the International Space Station for NASA and has already launched for NASA four times, with three of those missions having visited the ISS. Musk’s company also currently has an international backlog of some 50 civilian and commercial launch contracts totaling about $5 billion.
“If our rockets are good enough for NASA, why aren’t they good enough for the Air Force?” asked Musk at Wednesday’s hearing. “It makes no sense.”
SpaceX is scheduled to launch their third contracted ISS resupply mission under a Commercial Resupply Services contract with NASA as soon as March 16.