What are your thoughts on the small launcher and micro launchers market?

[Deepesh B]

I am doing rearech on micro launch market and how is it going to play out? What are barriers and challenges the companies will face?
What competition is it going to face form Medium/Heavy Launch vehicles and Super Heavy LVs like Starship rideshare missions?
Are OTVs a serious competition?
Which category will provide cheapest $/kg to LEO?

I would like to know your thoughs on this !!

Thank you

[deltaV]

Existing related threads include:
https://forum.nasaspaceflight.com/index.php?topic=38583.0
https://forum.nasaspaceflight.com/index.php?topic=57581.0

Here are some of my guesses.

If Stoke Space's Nova succeeds at getting their planned 3 tonnes to LEO with full reuse (https://forum.nasaspaceflight.com/index.php?topic=53164.msg2529512#msg2529512) I suspect it will be cheaper than any launcher smaller than it. This includes hypothetical smaller vehicles with full reuse since Nova's larger size will give it access to a bigger market which lowers costs. That would drive most of the smaller launchers out of business, but some smaller non-American launchers will remain due to nationalism.

Even without Nova the small and micro launcher market is very small (most small payloads go for cheaper launch as ride shares) so most of the small and micro launcher companies will go out of business. In practice small launchers often serve as a way for new launcher companies to get experience before they build a bigger launcher - SpaceX and Relativity both canceled their small launchers Falcon 1 and Terran 1 respectively because there wasn't a big enough market to be worth it.

SpaceX's Gwynne Shotwell has predicted that 0 small launchers will survive.

Cheapest $ / kg will probably be large reusable launchers such as Starship and possible full reuse upgrades to New Glenn and Terran R.

[edzieba]

And on the other hand: $/kg is not the sole factor customers use for deciding their launch vehicle, or in many cases even the primary one. 5 years on from SSO-A and many Transporter, Bandwagon, and Starlink rideshares later, customer continue to book small launchers for their satellites.
Dedicated launches offer direct insertion to your target orbit (rather than needing to purchase an additional in-orbit tug, or just end up in the wrong orbit), faster time-to-launch (less waiting for a rideshare not making generating any revenue), faster time-to-station (less time waiting after launch to get your satellite in place to generate revenue), and the option of custom features that a rideshare cannot accommodate (e.g. custom GSE connectivity).

For some payloads, those factors are less of a concern than the singular launch cost, so rideshares make more sense. For example, university and research payloads may not have a specific target orbit, and have low costs just sitting on a shelf waiting for launch. On the other hand, a (for example, SAR) startup that will need to pay its staff whether the satellite is on the ground or in orbit would prefer to have the satellite in orbit and generating revenue as soon as possible, even if the up-front launch cost is higher, because it's not much good getting a 'cheaper' launch if the company has gone bust whilst waiting for it.

[DanClemmensen]

And on the third hand (as discussed ad nauseam on other threads) Crazy Elon is aiming for an extremely low marginal per-launch cost for Starship, somewhere down below $5 million, with a ridiculously low turnaround time and therefore an extremely high potential launch rate. If SpaceX achieves these goals, then any competitive small launcher must beat these numbers. Starship is already in the late stages of development, and if successful will have a large Starlink manifest. If all of this works out, it will be cheaper for a customer to book a custom Starship launch than to book a custom launch on another LV.

It's crazy, but betting against Elon has not worked out very well.

[deltaV]

And on the other hand: $/kg is not the sole factor customers use for deciding their launch vehicle, or in many cases even the primary one.

Those factors help small launchers compete with rideshare. They don't help small launchers compete with fully reusable vehicles such as Nova or Starship.

[edzieba]

And on the other hand: $/kg is not the sole factor customers use for deciding their launch vehicle, or in many cases even the primary one.

Those factors help small launchers compete with rideshare. They don't help small launchers compete with fully reusable vehicles such as Nova or Starship.

That requires making multiple assumptions:
- That small launchers cannot be reusable (Electron likely to disprove this soon)
- That launch price will closely track marginal cost (has not thus far with Falcon 9)

[chopsticks]

It's crazy, but betting against Elon has not worked out very well.

You don't have to look very far to see this not being true. According to him, they should have landed on Mars a long time ago. They haven't even sent ANYTHING to Mars yet. Many many examples of Elon being wrong, sorry.

[DanClemmensen]

And on the other hand: $/kg is not the sole factor customers use for deciding their launch vehicle, or in many cases even the primary one.

Those factors help small launchers compete with rideshare. They don't help small launchers compete with fully reusable vehicles such as Nova or Starship.

That requires making multiple assumptions:
- That small launchers cannot be reusable (Electron likely to disprove this soon)
- That launch price will closely track marginal cost (has not thus far with Falcon 9)

In a somewhat free competitive market, price is higher than (fully-loaded) marginal cost, by enough to make a reasonable profit. If no effective competition in an elastic market, price is set to maximize absolute profit: this is approximately where F9 is now.

What factors do you believe would cause SpaceX to charge more than cost+reasonable profit in a competitive market?

[DanClemmensen]

It's crazy, but betting against Elon has not worked out very well.

You don't have to look very far to see this not being true. According to him, they should have landed on Mars a long time ago. They haven't even sent ANYTHING to Mars yet. Many many examples of Elon being wrong, sorry.

Yep, he is wrong a lot, especially about schedules. For schedules, he appears to me to have about the same abysmal track record as the rest of the industry.  I did not say he is always right. I said "betting against Elon has not worked out very well".

[TrevorMonty]

Years ago Shotwell said F9R launches would be $5M,  I think it was based on reuseable US that never happen. F9R list price is still $67m, same as before recovery was proven reliable.

Can't beat large RLVs for $kg but there will always be market for on demand dedicated small LVs. Until somebody undercuts Electron $7.5m its still bench market for low cost LVs. Whether there is enough market to support more small LVs is unknown.

[DanClemmensen]

Years ago Shotwell said F9R launches would be $5M,  I think it was based on reuseable US that never happen. F9R list price is still $67m, same as before recovery was proven reliable.

Can't beat large RLVs for $kg but there will always be market for on demand dedicated small LVs. Until somebody undercuts Electron $7.5m its still bench market for low cost LVs. Whether there is enough market to support more small LVs is unknown.

Shotwell said five million? Do you have a reference for that? I thought it was fifty million. You follow this stuff much more closely than I do, of course. I also do not know where to find the $7.5 million number.

[deltaV]

Those factors help small launchers compete with rideshare. They don't help small launchers compete with fully reusable vehicles such as Nova or Starship.

That requires making multiple assumptions:
- That small launchers cannot be reusable (Electron likely to disprove this soon)
- That launch price will closely track marginal cost (has not thus far with Falcon 9)

Partially or fully reusable small launchers are certainly possible but I'm skeptical of their business case. To win significant business small launchers need to have lower price per launch than any non-small launcher (assuming metrics such as reliability aren't a big factor) and I don't think they'll get that. To get good price per launch without losing money a launch vehicle needs good cost per launch which requires it to be big enough so that it has lots of customers to get flight rate up to spread fixed costs but not so big that it wastes too much money on expenses such as propellant that scale up with a larger vehicle. My hunch is that Starship is too big to win on price per launch in the fully reusable era (e.g. Starship has 39-42 engines to maintain) and small launchers are too small. The lowest price per launch will likely be intermediate-sized vehicles: Nova (especially with propellant transfer), fully reusable New Glenn, or a fully reusable launchers in between those vehicles in size.

(Like most of the people here I'm NOT a space professional so take my hunches with a load of salt.)

[Blackjax]

Years ago Shotwell said F9R launches would be $5M,  I think it was based on reuseable US that never happen. F9R list price is still $67m, same as before recovery was proven reliable.

Can't beat large RLVs for $kg but there will always be market for on demand dedicated small LVs. Until somebody undercuts Electron $7.5m its still bench market for low cost LVs. Whether there is enough market to support more small LVs is unknown.

Shotwell said five million? Do you have a reference for that? I thought it was fifty million. You follow this stuff much more closely than I do, of course. I also do not know where to find the $7.5 million number.

I suspect he's remembering a quote about the cost (not price) of starship (not Falcon 9).

[edzieba]

To win significant business small launchers need to have lower price per launch than any non-small launcher

This is not the case today, has not been the case in the past, and will continue to not be the case in the future, because there is no shortage of customers for whom price is not the primary deciding factor in launcher selection, just like price may not be the deciding factor in any other market.

Buses beat taxis on $/kg, $/rider, $/ride, etc. Taxis continue to exist in the face of an 'unbeatable' cost advantage, because the service they offer (to the exact destination of your choice on the timetable of your choice) is not possible with a bus.
 
It's no good paying less to get a service that isn't what you actually need. Small launchers offer a service some customers need. Even if you throw in an OTV for free, rideshares still only service some  of that need compared to dedicated small launches (orbit, but not schedule), and OTVs are not free - and thus far, are a risky proposition that may result in you losing your mission entirely in the event of an OTV issue.

[Blackjax]

Small launchers offer a service some customers need. Even if you throw in an OTV for free, rideshares still only service some  of that need compared to dedicated small launches (orbit, but not schedule), and OTVs are not free - and thus far, are a risky proposition that may result in you losing your mission entirely in the event of an OTV issue.

That may be true, but consider that when you strip out all the payloads whose needs can be met other ways from the addressable market of small launch companies, how many small launch companies will the remaining payloads be sufficient to support?  I don't know the answer but i'm pretty confident that the lower bound of the possible range starts at zero.

[DanClemmensen]

It's no good paying less to get a service that isn't what you actually need. Small launchers offer a service some customers need. Even if you throw in an OTV for free, rideshares still only service some  of that need compared to dedicated small launches (orbit, but not schedule), and OTVs are not free - and thus far, are a risky proposition that may result in you losing your mission entirely in the event of an OTV issue.

Rocket Lab's Electron appears to be the most successful current small launcher. Since 2017 it has launched a total of 41 times with 4 failures, the most recent failure in 2023. You must evaluate the possibility of an OTV failure on F9 against the possibility of launch failure on Electron. It takes lots of practice to achieve high reliability. There does not appear to be a big enough market to provide for that practice.

[DanClemmensen]

Years ago Shotwell said F9R launches would be $5M,  I think it was based on reuseable US that never happen. F9R list price is still $67m, same as before recovery was proven reliable.

Can't beat large RLVs for $kg but there will always be market for on demand dedicated small LVs. Until somebody undercuts Electron $7.5m its still bench market for low cost LVs. Whether there is enough market to support more small LVs is unknown.

Shotwell said five million? Do you have a reference for that? I thought it was fifty million. You follow this stuff much more closely than I do, of course. I also do not know where to find the $7.5 million number.

I suspect he's remembering a quote about the cost (not price) of starship (not Falcon 9).

Based solely on TrevorMonty's posts, this contributor is a senior member of the Rocket Lab team and I have found the posts credible and informative but with a strong tendency to support Rocket Lab. This particular post appears to have an error, and I was hoping for clarification from TrevorMonty because I want to continue to believe these posts.

[TrevorMonty]

Years ago Shotwell said F9R launches would be $5M,  I think it was based on reuseable US that never happen. F9R list price is still $67m, same as before recovery was proven reliable.

Can't beat large RLVs for $kg but there will always be market for on demand dedicated small LVs. Until somebody undercuts Electron $7.5m its still bench market for low cost LVs. Whether there is enough market to support more small LVs is unknown.

Shotwell said five million? Do you have a reference for that? I thought it was fifty million. You follow this stuff much more closely than I do, of course. I also do not know where to find the $7.5 million number.

At space conference in early days of F9 recovery attempts may have been soon after V1.1 maiden flight. Hadn't recovered it yet but there was not doubt they would.
Ariane space and maybe ULA were there. 

[deltaV]

To win significant business small launchers need to have lower price per launch than any non-small launcher

...Even if you throw in an OTV for free, rideshares still only service some  of that need compared to dedicated small launches (orbit, but not schedule), and OTVs are not free - and thus far, are a risky proposition that may result in you losing your mission entirely in the event of an OTV issue.

I didn't mean ride shares beat dedicated launch. I meant a big dedicated launch beats a small dedicated launch if the big launch is cheaper per flight.

[thespacecow]

Years ago Shotwell said F9R launches would be $5M,  I think it was based on reuseable US that never happen. F9R list price is still $67m, same as before recovery was proven reliable.

She said $5~7M in 2013, obviously this is marginal cost, not price.

That's $7~9M today with inflation, which is actually pretty close to rumored internal cost for Transporter launches per:

https://twitter.com/BellikOzan/status/1780125916750045613

I think SpaceX can undercut Electron right now without losing money, by using dual payloads similar to Ariane 5 (i.e. 2 Electron payloads on one F9), which would retain most of Electron's advantages. The reason they haven't is because the # of F9 launches per year is limited and flying other payloads (including Starlink) brings in more revenue/profit.