GAO Says Artemis 1 Flight Could Slip Amid Rising Costs

Artist’s conception of Space Launch System in Vehicle Assembly Building (Credit: NASA)

by Douglas Messier
Managing Editor

A new Government Accountability Office (GAO) review of NASA’s human lunar effort has concluded the Artemis 1 flight could slip to June 2021 as costs continue to rise.

“In November 2018, within one year of announcing an up to 19-month delay for the three programs—the Space Launch System (SLS) vehicle, the Orion spacecraft, and supporting ground systems—NASA senior leaders acknowledged the revised date of June 2020 is unlikely,” the report concluded. “Any issues uncovered during planned integration and testing may push the launch date as late as June 2021.

“Moreover, while NASA acknowledges about $1 billion in cost growth for the SLS program, it is understated. This is because NASA shifted some planned SLS scope to future missions but did not reduce the program’s cost baseline accordingly. When GAO reduced the baseline to account for the reduced scope, the cost growth is about $1.8 billion,” the document added.

The Artemis 1 mission would send an Orion spacecraft without a crew around the moon. The mission would be followed by a crewed flight test and then a lunar landing at the moon’s south pole in 2024.

In its response to GAO’s draft report, NASA said the government watchdog was overly negative about the programs’ progress and schedule while downplaying the complexity and technical challenges involved in developing systems designed to take astronauts back to the moon.

“The GAO report repeatedly projects the worst-case schedule outcome. While NASA appreciates the GAO’s need to be candid in its review, the Agency does take exception to the unnecessarily negative language used in the report title and second headings and the lack of acknowledgement of progress the Agency has made,” wrote William Gerstenmaier, NASA’s associate administrator for  human exploration and operations.

“The GAO does not acknowledge that NASA is operating in a dynamic environment, building a multi-decadal program, with multiple spacecraft and launch vehicle configurations, and with content that is subject to change as NASA’s deep space exploration objective evolves and program direction is adjusted,” Gerstenmaier added.

NASA concurred with three of the four recommendations GAO made to improve the programs, including:

We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the SLS program to calculate its development cost growth using a baseline that is appropriately adjusted for scope and costs NASA has determined are not associated with the first flight, and determine if the development cost growth has increased by 30 percent or more.

We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the EGS program to demonstrate design maturity by completing 3D product modeling of the basic and functional design of the second Mobile Launcher prior to construction start.

We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the SLS and Orion programs to reevaluate their strategies for incentivizing contractors and determine whether they could more effectively incentivize contractors to achieve the outcomes intended as part of ongoing and planned contract negotiations.

NASA only partially concurred with a recommendation regarding the first crewed mission called Artemis 2 (referred to in the GAO report as Exploration Mission 2 or EM-2).

We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the Orion program to update its cost estimate to reflect its committed EM-2 baseline date of April 2023.

“While it is true Orion life cycle development costs have experienced a growth of 5.5 percent since NASA conducted a Key Decision point review of the Orion program in 2015, the program is still well within the schedule commitment of April 2023,” Gerstenmaier wrote.

“Any additional slips to the program involve considerable uncertainty associated with ‘unknown-unknowns’ which are, by their very definition, impossible to predict or forecast,” he added. “Attempting to forecast these at this point is neither practical or useful to help manage the program.”

A summary of the findings follows.

Government Accountability Office
Report to Congressional Committees

NASA Human Space Exploration: Persistent Delays and Cost Growth Reinforce Concerns over Management of Programs
June 2019
Full Report

Why GAO Did This Study

NASA is undertaking a trio of closely related programs to continue human space exploration beyond low-Earth orbit. All three programs (SLS, Orion, and supporting ground systems) are working toward a launch readiness date of June 2020 for the first mission.

The House Committee on Appropriations included a provision in its 2017 report for GAO to continue to review NASA’s human space exploration programs. This is the latest in a series of reports addressing the mandate. This report assesses (1) how NASA’s human space exploration programs are performing relative to cost and schedule commitments, and (2) the extent to which NASA’s use of contract award fees is achieving desired program outcomes. To do this work, GAO examined program cost and schedule reports and contractor data, and interviewed officials. This report does not assess the effect, if any, of the government shutdown that ended in January 2019.

What GAO Found

Due to continued production and testing challenges, the National Aeronautics and Space Administration’s (NASA) three related human spaceflight programs have encountered additional launch delays and cost growth. In November 2018, within one year of announcing an up to 19-month delay for the three programs—the Space Launch System (SLS) vehicle, the Orion spacecraft, and supporting ground systems—NASA senior leaders acknowledged the revised date of June 2020 is unlikely. Any issues uncovered during planned integration and testing may push the launch date as late as June 2021. Moreover, while NASA acknowledges about $1 billion in cost growth for the SLS program, it is understated. This is because NASA shifted some planned SLS scope to future missions but did not reduce the program’s cost baseline accordingly. When GAO reduced the baseline to account for the reduced scope, the cost growth is about $1.8 billion.

Credit GAO

In addition, NASA’s updated cost estimate for the Orion program reflects 5.6 percent cost growth. The estimate is not complete, however, as it assumes a launch date that is 7 months earlier than Orion’s baseline launch date. If the program does not meet the earlier launch date, costs will increase further. Updating baselines to reflect current mission scope and providing complete cost estimates would provide NASA management and Congress with a more transparent assessment of where NASA is having difficulty controlling costs.

NASA paid over $200 million in award fees from 2014-2018 related to contractor performance on the SLS stages and Orion spacecraft contracts. But the programs continue to fall behind schedule and overrun costs. Ongoing contract renegotiations with Boeing for the SLS and Lockheed Martin for the Orion program provide NASA an opportunity to reevaluate its strategy to incentivize contractors to obtain better outcomes.

What GAO Recommends

GAO is making four recommendations to NASA, including that the SLS program should calculate cost growth based on costs that are currently included in the first mission and the Orion program should update its cost estimate to reflect the schedule agreed to in its baseline. In addition, the SLS and Orion programs should reevaluate their strategy for incentivizing contractors. NASA concurred with three recommendations, and partially concurred with the recommendation related to the Orion program’s cost estimate. GAO believes the recommendation remains valid, as discussed in the report.

Recommendations

1. We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the SLS program to calculate its development cost growth using a baseline that is appropriately adjusted for scope and costs NASA has determined are not associated with the first flight, and determine if the development cost growth has increased by 30 percent or more. (Recommendation 1)

2. We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the Orion program to update its cost estimate to reflect its committed EM-2 baseline date of April 2023. (Recommendation 2)

3, We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the EGS program to demonstrate design maturity by completing 3D product modeling of the basic and functional design of the second Mobile Launcher prior to construction start. (Recommendation 3)

4. We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the SLS and Orion programs to reevaluate their strategies for incentivizing contractors and determine whether they could more effectively incentivize contractors to achieve the outcomes intended as part of ongoing and planned contract negotiations. (Recommendation 4)