Pentagon Opens Up Launch Market to Competition

Launch of Atlas V NRO satellite on June 20, 2012. (Credit: ULA)

The Pentagon has opened up its launch contracts for both large and small satellites to competition, but in a way that will likely disappoint upstart launch provider SpaceX.

For large payloads, the U.S. Air Force will go forward with a scaled back bulk buy of up to 36 Atlas V and Delta IV rocket cores over the next five years from its current sole-source supplier, United Launch Alliance. It will open up an additional 14 cores to competitive bidding, giving SpaceX the opportunity to bid with its Falcon rockets.

For smaller payloads, incumbent provider Orbital Sciences Corporation will face competition from SpaceX and Lockheed Martin Corporation for launch contracts worth up to $900 million.

Space News has the details on the bulk buy:

 The first of these competitive awards is expected in 2015 for a mission launching in 2017, according to the memo.

“My intent with this decision is to maintain required mission assurance, obtain the positive effects of competition as quickly as possible, and also reduce the cost of the launch services we must procure from ULA,” Kendall wrote in the memo, a copy of which was obtained by SpaceNews.

As a hedge, the Air Force will retain an option to negotiate with ULA for the 14 cores currently subject to the competitive procurement in the event that no other contractor is able to meet the mission requirements, according to the memo.

According to an article from the Air Force News Service

A core is defined as the basic cylindrical unit of the rocket used to launch a payload into space. Some payloads require three cores combined together in a “heavy lift” configuration to reach the prescribed orbit. The 36 launch vehicle cores represent a total of 28 launches, including 24 single core launches and four requiring the “heavy lift” configuration.

SpaceX has argued vigorously against any bulk buys from ULA, saying it should be able to compete for large national security payloads on an even playing field. The Air Force scaled back its earlier plans to buy a much larger number of ULA rockets after criticism from Congress and the Government Accountability Office.

SpaceX will get a chance to launch smaller payloads for the Pentagon under the U.S. Air Force’s $900 million Rocket Systems Launch Program (RSLP).

Lockheed Martin will also join Orbital Sciences on the list of bidders for the launches. The three companies have indefinite-quantity, indefinite-delivery contracts to provide launch services through Nov. 29, 2017.

Orbital Sciences has been launching payloads under the program aboard its Minotaur rockets. It will also launch its medium-lift Antares rocket next year. SpaceX will use its Falcon 9 medium-class vehicle. Lockheed Martin has revived and upgraded its Athena rocket, which it took out of service several years ago. Lockheed Martin is working ATK on Athena.

Space News has additional details on the RSLP decision.

Article updated on Dec. 9 to correct number of rocket launches purchased.

  • Space X needs to start routinely placing payloads into orbit. That means at least four or more successful launches per year.

    Once that happens, then the DOD will rush to purchase Falcon 9 rockets and Falcon heavy rockets in bulk– if they are a lot cheaper than what the ULA can offer. Its that simple!

    Marcel F. Williams

  • warshawski

    If the DOD was serious about cost reduction it would purchase 4 falcon 9 launches and put low value satelites or instruments on the first 3 as quickly as possible to test the rocket and validate its reliability. Then use the 4th for a high value payload. It would still be cheaper than a single ULA launch. However it is not that simple there is lots of embeded behaviours that need to change.

  • RobH

    Yes and no, Mr. Williams. SpaceX does indeed need a great deal more flight time before they’re considered ready for prime-time, but the heads in the DOD are firmly entrenched in the ‘good ‘ol boy’ way of doing business. It will take heavier political intervention to even budge that. The ‘extra’ fourteen cores are a political appeasement, just to kick that can down the road.

  • Warshawski:

    This is pretty much what the Air Force has done. It’s booked a Falcon 9 for a NASA mission and a Falcon Heavy for one of its own satellites. It’s going to use the data from those launches to help certify the Falcons for the EELV program where ULA has a monopoly.

    I actually like this approach. It gets a bulk buy to reduce the per unit costs of ULA’s boosters and ensure a supply of very reliable, well tested rockets for to launch the military’s very valuable payloads. It gives SpaceX launches to help certify its boosters while not risking that much. And it puts competitive pressure on both SpaceX to start flying its already long manifest (which has moved consistently to the right) and to ULA to come up with cost savings in the form of a new upper stage engine. They’ve also opened up competition with the smaller payloads and reduced dependence on the Minotaur.

    This is a pretty good approach that opens competition while protecting the interest of taxpayers while new rockets get certified for flight.