March 5, 2014 Hearing on National Security Space Launch Programs (Musk and Gass)

[Jim]

Atlas as opposed to the cheaper F9

What says the F9 was cheaper?

[asmi]

What says the F9 was cheaper?

Musk said so - so it must be the truth

[Robotbeat]

I doubt Atlas V was cheaper, but there are a lot of metrics were Atlas V is comfortably ahead of Falcon 9 (for the time being). For instance, launch history and ability to launch on a tight schedule. Also, payload processing flow (which could increase costs for Falcon 9).

[Prober]

I doubt Atlas V was cheaper, but there are a lot of metrics were Atlas V is comfortably ahead of Falcon 9 (for the time being). For instance, launch history and ability to launch on a tight schedule. Also, payload processing flow (which could increase costs for Falcon 9).

Like Jim has said somewhere, the money isn't made in the launch.   Watching CRS-3 a low cost flight can turn into higher costs very quick.

[beancounter]

I doubt Atlas V was cheaper, but there are a lot of metrics were Atlas V is comfortably ahead of Falcon 9 (for the time being). For instance, launch history and ability to launch on a tight schedule. Also, payload processing flow (which could increase costs for Falcon 9).

Like Jim has said somewhere, the money isn't made in the launch.   Watching CRS-3 a low cost flight can turn into higher costs very quick.

How?  Srike that.

Rather delays occur to all vehicles and if I remember rightly ULA suffered one not all that long ago - engine issue which saw the vehicle sit on the pad for what 3 or 4 months.
So if delays happen then they are an accepted part of the business.

Do we know if SpaceX bid for it or if it was even open to a bid?

[WulfTheSaxon]

A bit more action on this: http://breakingdefense.com/2014/04/spacex-turns-up-heat-on-ula-sen-feinstein-writes-secdef/

(The Senate Appropriations Committee website appears to be down now, or I’d link straight there.)

[JohnFornaro]

Here's the full text of Feinstein's letter:

http://www.feinstein.senate.gov/public/index.cfm/press-releases?ID=9e2e8ba6-b6a9-4d3a-9a45-b2199b84e22b

April 1, 1814

The Honorable Chuck Hagel
Secretary
Department of Defense
1000 Defense Pentagon
Washington, DC 20301-1000

Dear Secretary Hagel:

We write to express our concern regarding the Air Force’s proposed reduction in competition opportunities for new entrants in the Evolved Expendable Launch Vehicle (EELV) program. We strongly believe this proposal undermines the Air Force’s previous plan to begin to compete launches in 2015 and urge you to take all necessary steps to ensure the Air Force fulfills its commitment to provide meaningful competition opportunities this year for award in fiscal year 2015 and beyond.

As you know, Under Secretary of Defense for Acquisition, Technology and Logistics Frank Kendall issued an Acquisition Decision Memorandum on November 27, 2012, directing the Air Force to “aggressively introduce a competitive procurement environment” for the EELV program, and identify “up to 14 missions that should be competed as early as 2015.”

However, the Air Force’s recent budget proposal includes plans to compete zero Air Force missions in 2015 and to reduce the total number of missions to be competed from 14 to 7 during fiscal years 2015 - 2017. We believe this action does not comply with the 2012 Acquisition Decision Memorandum and should be immediately reviewed.

The lack of competition in the EELV program comes at a time when the cost of national security space launches has greatly increased. The EELV program has incurred massive cost overruns since the United Launch Alliance was formed in 2006. Since 2011 alone, the amounts budgeted by the Air Force for an average of six satellite launches per year has grown by 60 percent. The President’s fiscal year 2015 budget request revealed that the unit price to the Air Force had risen nearly $200 million since fiscal year 2014 at a time when the previous plan promised serious savings to the Air Force. These increased costs in a difficult budget environment are a clear indication as to why these launches should be competed.

We understand from recent public statements from the Air Force that new entrants to the EELV program may be certified this year. If there is more than one certified provider capable of executing any Air Force launch, we believe that those missions should be competed.

Thank you for your consideration. We look forward to your prompt response.

Sincerely,

Dianne Feinstein, United States Senator
Barbara Boxer, United States Senator
Tom Udall, United States Senator
Martin Heinrich, United States Senator
Mark Warner, United States Senator
Roger Wicker, United States Senator
Claire McCaskill, United States Senator

[JohnFornaro]

...ULA, an unholy combination of defense giants Lockheed Martin and Boeing.

Hah!  Their words, not mine.

Pretty good article.

[john smith 19]

The lack of competition in the EELV program comes at a time when the cost of national security space launches has greatly increased. The EELV program has incurred massive cost overruns since the United Launch Alliance was formed in 2006. Since 2011 alone, the amounts budgeted by the Air Force for an average of six satellite launches per year has grown by 60 percent. The President’s fiscal year 2015 budget request revealed that the unit price to the Air Force had risen nearly $200 million since fiscal year 2014 at a time when the previous plan promised serious savings to the Air Force. These increased costs in a difficult budget environment are a clear indication as to why these launches should be competed.

So that's an average "inflation rate" in USG launch prices of about 20% a year?

That seems kind of steep.

Looking at  http://www.usinflationcalculator.com/inflation/historical-inflation-rates/ suggest the worst normal rate was 3.9% in Aug 2011.

Does anyone think there might be a bit of a "market failure" occurring here?

[JohnFornaro]

The lack of competition in the EELV program comes at a time when the cost of national security space launches has greatly increased. ...

So that's an average "inflation rate" in USG launch prices of about 20% a year?

That seems kind of steep.

Looking at  http://www.usinflationcalculator.com/inflation/historical-inflation-rates/ suggest the worst normal rate was 3.9% in Aug 2011.

Does anyone think there might be a bit of a "market failure" occurring here?

There's an interesting discussion on aerospace inflation here:

http://forum.nasaspaceflight.com/index.php?topic=21348.msg777569#msg777569

I've heard a figure of %30 percent annually being arbitrarily added to estimates.

[john smith 19]

There's an interesting discussion on aerospace inflation here:

http://forum.nasaspaceflight.com/index.php?topic=21348.msg777569#msg777569

I've heard a figure of %30 percent annually being arbitrarily added to estimates.

Perhaps I have it wrong but I've always thought that "inflation" is the rate of price rise because things are in more demand.

But my impression is that in USG terms demand is pretty flat. Same customers buying same stuff to same spec.

Which would suggest that any price inflation would be a reflection of the rise in prices from the things that are inputs from the wider economy (IE < 4% maximum in the period 2011-2013).

Whereas this "inflation" looks to be more like "because we can."

I don't call that inflation. I call that greed. 

[JohnFornaro]

...I've heard a figure of %30 percent annually being arbitrarily added to estimates.

Perhaps I have it wrong but ... this "inflation" looks to be more like "because we can."

I don't call that inflation. I call that greed.

What are you saying?  That Vlad can't practice capitalism and charge what the market can bear?  That our aerospace industries shouldn't be rewarded for the innovation of creating the next BFR on such an accelerated schedule?  That Americans shouldn't have jobs?  How many launch vehicles have you designed, BTW?

[baldusi]

Inflation is a generalized increase in prices. Nothing more. It has no cause attached.
And the specs are not the same, Atlas II, Titan and Delta Ii are not same spec as EELV. And even then, we lack the necessary information to understand the causes. Even GAO doesn't have the necessary info.

[JohnFornaro]

Inflation is a generalized increase in prices. Nothing more. It has no cause attached.
And the specs are not the same, Atlas II, Titan and Delta Ii are not same spec as EELV. And even then, we lack the necessary information to understand the causes. Even GAO doesn't have the necessary info.

I refuse to accept a causeless explanation.  However the various types of inflation are defined, some are intentional, and some have rational explanations.  Inflation is not a random activity.  It has causes, whether or not we understand them, or acknowledge the known causes.

[baldusi]

Inflation is a generalized increase in prices. Nothing more. It has no cause attached.
And the specs are not the same, Atlas II, Titan and Delta Ii are not same spec as EELV. And even then, we lack the necessary information to understand the causes. Even GAO doesn't have the necessary info.

I refuse to accept a causeless explanation.  However the various types of inflation are defined, some are intentional, and some have rational explanations.  Inflation is not a random activity.  It has causes, whether or not we understand them, or acknowledge the known causes.

It's a semantic issue. It's a descriptive verb. It can have many causes. Thus, by saying inflation is just the price increase. You have to add a "caused by" to attach a cause.
In the EELV case, there might be many reasons. One is non homogeneous goods (i.e. You are adding requirement, like OSHA and FAR and payload specs). Other might be payload weight (or performance) increase. Another might be that you didn't took into account some subsidies that evaporated. Or the first bid was a money losing bet and now they can increase prices to recoup the initial losses. Or whatever. That's why talking about price inflation for too narrow set of prices is not a good idea. It's too close to single industry (or even single good) process. Which is exactly why NASA speaks of Project Start Index and not project start inflation rate.

[JohnFornaro]

... Or whatever. That's why talking about price inflation for too narrow set of prices is not a good idea. It's too close to single industry (or even single good) process. Which is exactly why NASA speaks of Project Start Index and not project start inflation rate.

Sorry, too facile a dodge for my simple tastes.

Of course, in general, there are many causes for inflation, and it is important to list them correctly and to understand them accurately.

We are in a time of "officially" low inflation.  As is well understood by the American proletariat, the official inflation rate excludes many of the things which cost so much.  Housing, the so-called volatile energy sector.  Heck even food, in some tellings, isn't included.

The real, out of real people's pockets rate of inflation is a good bit higher, maybe not dangerously higher, but still, it is much higher than the official rate.

John Smith 19 made the comment above that the aerospace inflation rate has a distinctive scent of "Arbitraire", a new perfume based on the byproduct of the male bovine.  The Russians recently raised their prices to NASA based on the same principle.  ULA came up with some pretty hefty price increases of its own for the latest "block buy", which, ostensibly, was to have controlled costs.

We really don't care about the cognitive subtleties regarding a "narrow set of prices", "Project Start Indexes", and all that hokey pokey, which serve to deliberately distract from the costs and prices that raise almost at escape velocity.

The industry appears to be arbitrarily pricing itself out of work.  Keep on defending their practices if you wish.

[john smith 19]

What are you saying?  That Vlad can't practice capitalism and charge what the market can bear? 

Heaven forbid. I wouldn't want to be thought of as, y'know, some kind of Communist. 

That our aerospace industries shouldn't be rewarded for the innovation of creating the next BFR on such an accelerated schedule?

Not at all. I just find the inflation rate a mite hard to figure out over and above the usual US rate. Unless of course the RD180 is that big a chunk of the cost that putting up it's cost slaps 20% on the launch price automatically?

  That Americans shouldn't have jobs?  How many launch vehicles have you designed, BTW?

Wouldn't a "Made in the USA" engine create more jobs?

And I've probably designed as many engines as you have. 

Actually I can think of another example which could have NS space implications.

Antares uses 2 rebuilt NK33's for its first stage. There are a finite number of these left and I don't think there's any talk of re opening production. In 2009 the Soyuz-2-1v started launching with an NK33 in its first stage.

Orbital knew there were only so many of these engines built, yet it claims it wants to move into the market the Delta II used to serve. AFAIK Aerojet has enough to finish the NASA COTS contract so if Orbital want to build more than that what's the new price going to be? AFAIK there is a new Russian engine that superseded the NK33, but again it's Russian, and likely to need some 1st stage re design. 

[JohnFornaro]

Wouldn't a "Made in the USA" engine create more jobs?

Seriously, you realize I'm teasing you, right? 

Because that's a big part of the issue here.  For some reason, a skilled American work force which would be building the new infrastructure, according to the principles of Intelligent Design, is not seen as even a nice-to-have.  Forty some odd years later, they haven't improved the F-1 engine.  Not because they can't, but because they won't.  The list of the sensible stuff that they won't do is very long.

And I've probably designed as many engines as you have.

Fah real?  You've designed zero engines too?  Hit me up and let's kickstart a new company.  The "X" is taken.  How about SpaceY?

[john smith 19]

Seriously, you realize I'm teasing you, right? 

I do.  I also like that you get there's more to this stuff than just the technology.

Because that's a big part of the issue here.  For some reason, a skilled American work force which would be building the new infrastructure, according to the principles of Intelligent Design, is not seen as even a nice-to-have.  Forty some odd years later, they haven't improved the F-1 engine.  Not because they can't, but because they won't.  The list of the sensible stuff that they won't do is very long.

<sigh>
And that's rather less funny.  TBF if you're hell bent on reviving a 40 year old design it would seem to be a good first step to make sure you can revive it "as is," so that any problems are proved to be associated with the revival process and not upgrades. It does add another iteration but you start from solid foundations, although the F1A had never been flown I think it's got enough stand time to be pretty sure it will work.

I think the big problem with engine design is the ratio of engineers (and their range of skillsets) needed to build a new engine versus the team size needed to update / fault find an existing engine.

The (management) assumption seems to be that they cannot afford to keep the additional staff around as they will be "doing nothing"  because (obviously) the design is complete. My instinct is that this "common sense" is in fact nonsense but management considers it too risky to try.

Musk has been smart to keep his team together and keep their momentum up. I wonder how many more designs and design iterations Spacex can keep it up for but I hope they will as long as possible. 

Returning to the topic of this thread it would seem there is an argument that there should be some shared government organization that should support "pre competitive" research for advanced engine features like gas tap off or oxidizer rich staged which would allow mfgs to take the basics and develop their own (proprietary) engines from them.

Except I thought that was what NASA was for. 

My personal bugbear has always been that after 60 years (including the 30 odd years of Shuttle operations of GH2 and GO2 on orbit for up to 2 weeks) NASA has still not run a mission for LO2/LH2 on orbit propellant handling despite their belief that this is the only propellant combination for big payloads and/or human BEO flight. 

I cannot work out the logic of why you would not do this.

Fah real?  You've designed zero engines too?  Hit me up and let's kickstart a new company.  The "X" is taken.  How about SpaceY?

Well almost. 

I thought about designing an engine one time, but I had a lie down for a bit and the idea went away. 

[JohnFornaro]

I thought about designing an engine one time, but I had a lie down for a bit and the idea went away.

Istarted a nozzle design two years ago. Spent about two or three full days on an initial iteration.  Real life got in the way, I dropped it and never picked it up again.  One lesson learned:  Rocket science may be hard for guys like me, but the texts are accessible, in general.  However.  There are bits and pieces missing in the text, probably considered basic to engineers and engineering students, but crucial to primitive man, who is looking for a recipe book that leaves nothing out.

Anyhow, back to regular programming...