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Business, Space

SpaceX Press Conference

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Elon — half a billion dollars, biggest commercial launch deal in history. Reinforces fact that Falcon 9 is vehicle of choice not just for NASA but also for commercial sector. Also a lot of international customers. Good thing for US in particular because vehicles are built 100% in the US. US hasn’t been cost competitive in launch market, but are now.

2015-2017 for launch. Expect a couple dozen launches before then.

Bobby Block: What does mean in terms of what you’ll be looking for from the government to accelerate both crew and cargo?

Elon: Won’t make much difference, but does validate the NASA’s approach. Over the long term the cost to NASA and the taxpayer will be less because fixed costs will be divided by larger number of launches. Dragon is currently long pole, and this deal doesn’t affect that.

Block: People talking about Shuttle extension and more flights. If Shuttle is extended will it affect COTS?

Elon: Doesn’t see it affecting things. Assume that everyone knows that extending/restarting not a viable option. An extra Shuttle flight will cost a lot of money, more than SpaceX is getting for the entire NASA constract.

Claire Moskowitz: When launching out of Vandenberg?

Elon: Two years from now, roughly. Using SLC-4, former Titan IV facility (just like at the Cape). So they have a good understanding of what it takes to convert, 12-18 months.

Moskowitz: How about Taiwan launch on Falcon 1e?

Elon: Been in discussion for a couple years. Planning to do a number of Falcon 1e launches. Over forty launches manifested by the end of the year.

Alan Boyle: How many launches is the contract? About ten? One more provider to receive lion’s share?

Elon: No insight into other provider. SpaceX is primary provider, so other will be a backup or secondary. Can’t comment on exact number of launches, depends on final satellite configuration.

Elon: Most of the money goes to satellite production, the half billion is just the launch piece. Part of the cost is dispenser development, so it’s not all launch costs.

MSNBC: When is next launch, and what is cash situation (talking about Pasztor’s billion-dollar number).

Elon: Pasztor’s article rife with errors. In good financial shape but may take on debt for working capital. May also take in strategic investor. Next launch toward end of summer. Falcon 9 carrying operational version of Dragon.

Todd Halvorson: What is total backlog of Falcon 1/9 launches?

Elon: Low thirties in terms of backlog. Will be over forty by the end of the year.

Halvorson: Assuming that Iridium are polar, will any be equatorial?

Elon: Some chance of equatorial, but all current plans high inclination.

Irene Klotz: Location of Falcon 1e with Taiwan satellite?

Elon: Kwaj.

Klotz: How much to convert SLC-4 for Falcon 9?

Elon: $40-$50M.

Klotz: Who was competition for Iridium?

Elon: Everyone. French satellite, so no restrictions on American content issue. Global competition.

Klotz: How is data analysis from flight going?

Elon: Not a lot to report. It went great. Slight roll anomaly isolated to probably the roll-control actuator, but still not positive, still seeking internal consensus. A little too concerned that it went too good. Will be looking for “near misses” to prepare for next flight.

Space News: Is contract for all seventy two birds, or just a piece of the Constellation?

Elon: Doesn’t want to discuss that, ask Iridium.

ALan Boyle: Any better sense of how long the Dragon test article will stay in orbit? Is there another client for the mission, perhaps classified? Can you say anything?

Elon: Laughs, can neither confirm or deny. Dragon will stay up for a year or two, and burn up on entry.

Halvorson: Comment on how SpaceX operates versus legacy companies in terms of costs?

Elon: Doesn’t like to give sound bites — oversimplifies. Needs to write a paper on it. Like asking why Southwest is cheaper. Not just because they use 737s. SpaceX operates on a Silicon Valley OS and DNA. Sort of like an Intel or Apple or Google of space transport. Vertical integration helps also, once problems are solved. Too much outsourcing in traditional aerospace. They cut out middlemen. Using legacy components means inheriting legacy cost structure. Tightly integrated team, with factory on the same floor as engineering. Everyone in a cube, including him. Also, very simple, with same propellants in both stages. Upper stage simply a short version of first stage. Same engine on both stages, so lots of economies of scale from Merlin.

Klotz: Launch escape in house, or contract?

Elon: Building liquid escape engines into sidewall of Dragon, which will be safety improvement over solid. Won’t have to eject a tower. Having something that you have to eject every flight seems like a crazy idea. Will have escape capability all the way to orbit.

International Business: Is this part of the two and a half billion in contracts?

Elon: Yes, it’s about $2.7B, including this, through 2017, but bulk over the next five years.

Are Chinese competition?

Yes, when international customer.

How much financial margin? Can you avoid the Sea Launch problem?

Elon: Cash flow not significantly affected even in stand down. Sea Launch suffered from single-point failure of launch platform. Tough to recover from. SpaceX has site flexibility of Vandenberg, Cape and Kwaj.

Space News: Might want to check out if Chinese were eligible to bid for Iridium work.

Elon: Not sure they were, just thought they were because of French satellite. You may know more than me, but didn’t think there was an ITAR issue.

Conference over.

[Update a few minutes later]

The one question that I didn’t capture was mine. I asked him if they knew yet why the first stage didn’t survive entry, or if they would have to wait for another flight to get better data (because they didn’t get the microwave imaging data they wanted). He said that they still didn’t know, and might not figure it out until they try again. I followed up, asking if he could conceive of a time that they might just give up on it, and pull the recovery systems out to give them more payload. I was surprised at the vehemence of his answer (paraphrasing): “We will never give up! Never! Reusability is one of the most important goals. If we become the biggest launch company in the world, making money hand over fist, but we’re still not reusable, I will consider us to have failed.” I told him that I was very gratified to hear that, because I like reusability.

[Early afternoon update]

Here’s Bobby Block’s report on the presser.

Business, Economics, Political Commentary, Space, Technology and Society

Sorry, It’s Not The Manhattan Project

32 Comments

…or Apollo. I suffered through the president’s speech so you don’t have to.

The most egregious part of it was when he compared energy independence to Apollo. Here’s my response from the campaign:

He’s never met a problem that, in his mind, the “full power of the government” can’t solve.

It’s an understandable appeal, but it betrays a certain lack of understanding of the problem to think that we will solve it with a crash federal program, at least if it’s one modelled on Apollo.

Putting a man on the moon was a remarkable achievement, but it was a straightforward well-defined engineering challenge, and a problem susceptible to having huge bales of money thrown at it, which is exactly how it was done. At its height, the Apollo program consumed four percent of the federal budget (NASA is currently much less than one percent, and has been for many years). Considering how much larger the federal budget is today, with the addition and growth of many federal programs over the past forty years makes the amount of money spent on the endeavor even more remarkable.

But most of the other problems for which people have pled for a solution, using Apollo as an example, were, and are, less amenable to being solved by a massive public expenditure. We may in fact cure cancer, and have made great strides over the past four decades in doing so, but it’s a different kind of problem, involving science and research on the most complex machine ever built — the human body. It isn’t a problem for which one can simply set a goal and time table and put the engineers to work on it, as Apollo was. Similarly, ending world hunger and achieving world peace are socio-political problems, not technological ones (though technology has made great strides in improving food production, which makes the problem easier to solve for governments that are competent and not corrupt). So most of the uses of the phrase never really made much sense, often being non sequiturs.

It’s important to understand that landing a man on the moon (or developing atomic weaponry as in the Manhattan Project — another example used by proponents of a new federal energy program) was a technological achievement. Achieving “energy independence,” or ending the use of fossil fuels, are economic ones. And the former is not necessarily even a desirable goal, if by that one means only getting energy from domestic sources. Energy is, and should remain, part of the global economy and trade system if we want to continue to keep prices as low as possible and continue to provide economic growth.

Nothing has changed. My commentary remains true today.

[Wednesday morning update]

If we can put a man on the moon, why can’t we stop the leak, Mr. President? That’s a much better Apollo analogy.

Business, Economics, Political Commentary

If You Like Your Plan

21 Comments

You can keep it. Unless we don’t like your plan:

Internal White House documents reveal that 51% of employers may have to relinquish their current health care coverage by 2013 due to ObamaCare. That numbers soars to 66% for small-business employers.

Were people really stupid enough to believe his lies during the campaign?

On the plus side, “repeal the bill” will have a lot more resonance this fall.

[Sunday morning update]

The good news just keeps on coming:

This year Ms. Watts estimates that changes made in response to the health law will add an extra 2 to 3 percent in cost increases, pressuring employers to engage in even more cost-sharing with employees — whether through higher premiums, co-payments or other out-of-pocket costs.

Mr. Weaver also reports increased interest by employers in high-deductible insurance plans. “They’ve been effective in managing costs,” he said.

You know, someone just a little smarter than Nancy Pelosi (i.e., almost everyone) would have been able to figure out what was in the bill without having to pass it.

Business, Economics, Political Commentary

In Which A Congressman Is An Idiot

14 Comments

Yeah, I know, dog bites man, but I still enjoyed this exchange with Bernanke:

The entire premise of his question is absurd. The budget for FY2010 exceeds $3.8 trillion, which means that we don’t have to eliminate “half the ledger sheet” in order to close a $1.3 trillion deficit. We only need to eliminate a third of the ledger sheet. That $3.8 trillion, by the way, is $1.1 trillion more than the last budget from a Republican Congress, FY2007. If we returned to the FY2007 budget, we’d be almost all of the way there just by eliminating all of the spending increases inserted after Nancy Pelosi and Harry Reid took charge of the budgeting process.

Oh, but that would be the end of the world as we know it.

Business, Economics, Media Criticism, Space

My Sidebar For Popular Mechanics

19 Comments

…didn’t run, so I’ll run it here.

In Monday’s Wall Street Journal, Andy Pasztor reported that SpaceX’s CEO, Elon Musk, has claimed that it will cost a billion dollars to develop the launch escape system for the Dragon capsule needed to allow it to carry crew. This would be twice the amount that it has cost to develop both the Falcon 1 and Falcon 9 rockets, and the Dragon itself, from scratch, and seemed quite improbable to many who have read it.

Mr. Musk notes in an email:

“I definitely didn’t tell Pasztor that our LES would cost $1B. He is off by a factor of ten! All I told him is that there is no way it would cost us more than $1B to demonstrate crew transport. That includes development, testing and certification to the most stringent NASA standards of everything needed for a seven-crew vehicle. I’ve also said that our price per person would be $20M, assuming the seven-person configuration and minimum of four flights per year. This compares to $30B for Ares I/Orion and a per person cost of ~$250M.”

In a follow up, he noted that the billion (if it goes that high) will include two abort flight tests (one on the pad, one high altitude) and a demonstration flight to and from ISS. Sounds like a bargain to me.