Launch Competition Continues to Advantage Entrenched Contractors | Citizens Against Government Waste

Launch Competition Continues to Advantage Entrenched Contractors

The WasteWatcher

On August 7, 2020, the Space and Missile Systems Center announced that SpaceX and United Launch Alliance (ULA) have been selected for the latest round of National Security Space Launch (NSSL) contracts.  Beginning in fiscal year 2022, the companies will launch at least 30 satellites into orbit for the National Reconnaissance Office and the Space Force.  SpaceX and ULA, a joint venture between Boeing and Lockheed Martin, were selected over Blue Origin and Northrop Grumman.

The award split between the companies is inequitable.  ULA will be responsible for 60 percent of the launches, with SpaceX covering the rest.  Three launches for 2022 were also announced; ULA will be awarded $337 million for two launches, and SpaceX will receive $316 million for its launch.

Likely because it’s technology is fully mature, SpaceX wasn’t even included in the first round of the NSSL competition, which awarded ULA $967 million, Northrop Grumman $792 million, and Blue Origin $500 million to develop launch systems.

Because the ULA employs a Russian-made RD-180 engine in its Atlas V rocket, the conglomerate has been under pressure to develop an alternate launch vehicle.  To that end, the ULA is developing the Vulcan Centaur, which is set to make its initial flight in 2021.  A congressional mandate stipulates that the ULA must cease using Russian technology by 2022.

According to Air Force Assistant Secretary for Acquisition, Technology, and Logistics William Roper, the latest NSSL competition marks “…a new epoch of space launch that will finally transition the Department off Russian RD-180 engines.”  However, if the Department of Defense were concerned with preventing Russia from benefitting from the NSSL program, they might have selected one of the other participants in the bidding process to combine with SpaceX for the launches. 

Unfortunately, the uneven split in the NSSL contracts reflects the long-term preferential treatment by the federal government for established aerospace contractors.  While private sector investment has begun to change the status quo, American aerospace has for too long been dominated by a handful of entrenched firms, enabled by institutional biases and preferentially written contracts.  The end result has been inflated prices and a lack of innovation.  SpaceX itself was initially blocked from bidding for NSSL contracts, and only an April 2014 lawsuit opened up the competition. 

As it stands, the NSSL award suggests business as usual in American aerospace.  

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