Author Topic: Commercial Crew - Discussion Thread 3  (Read 253533 times)

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #740 on: 09/05/2022 09:54 pm »

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.


Because it is an IDIQ contract and NET prices/terms were already negotiated in the basic contract.  That is the same way NLS and CRS contracts work.
Yes! Thank you for reminding me. IDIQ contracts are a prerequisite to declaring unexpected losses of income.

Again, this is another case where you go on your anti Boeing rant

Re: Commercial Crew - Discussion Thread 3
« Reply #741 on: 09/05/2022 10:00 pm »
I finally started thinking about this. I have two questions:

Is this a sole-source award? If so, how was it justified? Was it publicly justified somewhere? if not, did we see any announcement of a competitive bid? did Boeing decline to bid? The prior award to SpaceX was a sole-source extension justified by the lack of an alternative, since Starliner was not operational.
[...]

NASA posted a rationale for sole-sourcing additional crew missions from SpaceX

Notice of intent (NOI) to Issue a Sole Source Modification - NASA Commercial crew Space Transportation Services
Notice ID: NOI-KSC-CCP-2022-001
Published Date: June 1, 2022
https://sam.gov/opp/62c5cba7a90947a391388ad990a3ac91/view

Subsequent announcement of award:
Modification to SpaceX Commercial Crew Transportation Capabilities (CCtCap) contract
Contract Award Date: August 31, 2022
https://sam.gov/opp/d3f34edac1a54614a0e8c9fcf931015e/view
OK, but these additional flights will not be needed until about H2 2025 even if Starliner never files. So why have we not heard a single peep out of Boeing urging NASA to defer this decision? It is tempting to think that Boeing has decided to terminate Starliner after Starliner-6.

If that occurs, Starliner will have flown 6 of a total of 20 flights, or 30%, while Crew Dragon will have flown 14, or 70%, while NASA pays Boeing more in total than it pays SpaceX. Further, unless NASA stretches out the Boeing schedule, they will not have redundant suppliers for the last two years of the ISS program.
It could be NASA is doing Boeing a favor. NASA excludes Boeing from bidding. Boeing can now declare an "unexpected loss of income" and write it off, then defer it toward future profits. Much more valuable to Boeing than the flights.
Here's a modest idea: Boeing should cancel Starliner and buy cheaper seats from SpaceX for the six flights it has on its books and bank the difference; guaranteed profit which more than offset by the written-off unexpected loss of income. Free money! Win-win for Boeing and SpaceX, the government not so much.
Boeing is contracted to provide 6 Starliner flights to NASA at a fixed price. NASA has stated for more than ten years that they want redundancy. NASA is unlikely to allow Boeing to walk away from this contract, especially after Boeing essentially forced NASA to add $284 million to  the contract and guarantee 6 flights instead of two in 2018 to keep them in the program. You reap what you sow.

We do not know what went on behind the scenes, so we do not know that Boeing was "excluded from bidding". NASA may have awarded the sole-source contract to SpaceX only after discussing the situation with Boeing. If Boeing informally indicated no interest, then a NASA sole-source to SpaceX was administratively simpler and less costly than a formal bidding process.

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.
The second part, the modest proposal, is facetious sarcasm, but I am serious about the first part. The additional flights Boeing is missing out on are more valuable not to have because Boeing can declare those as unexpected losses of income on their taxes. It's part of why corporations pay little or no taxes.

Not true at all.
NASA did not exclude Boeing.  NASA went to SpaceX because Boeing was unable to perform and it was justified.  Boeing canít claim anything for that if it did not protest.
I could be wrong, but I don't think that matters. Boeing has to claim that profitability on their original investment was modeled based on being able to bid on further contracts and expected to win half of them. To wit:

Quote
"Unexpected Loss is a formal Risk Measure that was introduced as part of the Basel II regulatory reforms. It is used primarily in the context of estimating Risk Capital using internal models and it aims to explicitly separate the related Expected Loss concept, (the idea being that expected losses are provisioned for and unexpected losses must be explicitly insured against with other forms of capital).

Unexpected losses correspond to the unpredictable/unforeseeable losses that have a lower probability of occurrence but may nevertheless occur. Statistically, for a given confidence interval of the Loss Distribution Function, unexpected losses (UL) correspond to the difference between the maximum loss incurred and expected losses (EL)"
All animals are equal, but some animals are more equal - Animal Farm by George Orwell

Re: Commercial Crew - Discussion Thread 3
« Reply #742 on: 09/05/2022 10:01 pm »

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.


Because it is an IDIQ contract and NET prices/terms were already negotiated in the basic contract.  That is the same way NLS and CRS contracts work.
Yes! Thank you for reminding me. IDIQ contracts are a prerequisite to declaring unexpected losses of income.

Again, this is another case where you go on your anti Boeing rant
Are you Boeing or something? Do you want to tell me what is unfair about it?
All animals are equal, but some animals are more equal - Animal Farm by George Orwell

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #743 on: 09/05/2022 10:08 pm »

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.


Because it is an IDIQ contract and NET prices/terms were already negotiated in the basic contract.  That is the same way NLS and CRS contracts work.
Yes! Thank you for reminding me. IDIQ contracts are a prerequisite to declaring unexpected losses of income.

Again, this is another case where you go on your anti Boeing rant
Are you Boeing or something? Do you want to tell me what is unfair about it?

This is the only thing you post on and more often than not, it is something wrong.

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #744 on: 09/05/2022 10:10 pm »
You are wrong.  Boeing isnít guaranteed anything beyond the basic contract. 

Re: Commercial Crew - Discussion Thread 3
« Reply #745 on: 09/05/2022 10:31 pm »
You are wrong.  Boeing isnít guaranteed anything beyond the basic contract.
You are right NASA is under no obligation beyond the basic contract, but NASA does not make the tax laws.  Do you work for Boeing? Are there people who post here that work for Boeing that you know of?
All animals are equal, but some animals are more equal - Animal Farm by George Orwell

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #746 on: 09/05/2022 10:36 pm »
You are wrong.  Boeing isnít guaranteed anything beyond the basic contract.
You are right NASA is under no obligation beyond the basic contract, but NASA does not make the tax laws.  Do you work for Boeing? Are there people who post here that work for Boeing that you know of?

And Boeing can only write off what it is contracted for.  Not unguaranteed future work.  It hasnít risked anything on it or spent money towards it.

Re: Commercial Crew - Discussion Thread 3
« Reply #747 on: 09/05/2022 10:46 pm »
You are wrong.  Boeing isnít guaranteed anything beyond the basic contract.
You are right NASA is under no obligation beyond the basic contract, but NASA does not make the tax laws.  Do you work for Boeing? Are there people who post here that work for Boeing that you know of?

And Boeing can only write off what it is contracted for.  Not unguaranteed future work.  It hasnít risked anything on it or spent money towards it.
I agree to disagree with you about the tax law until proven otherwise.
All animals are equal, but some animals are more equal - Animal Farm by George Orwell

Offline DanClemmensen

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Re: Commercial Crew - Discussion Thread 3
« Reply #748 on: 09/05/2022 11:04 pm »

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.


Because it is an IDIQ contract and NET prices/terms were already negotiated in the basic contract.  That is the same way NLS and CRS contracts work.
I know this is the second sole-source extension to the original IDIQ contract. The original fixed-price contract was for development (with milestone payments) plus two guaranteed operational missions at a fixed per-misson price, plus up to four additional missions at that same per-mission price. The first sole-source extension was for up to three additional missions at a different per-mission price. SpaceX agreed to this extension: NASA did not have the legal power to require SpaceX to fly these missions. Later, NASA awarded SpaceX this new second IDIQ extension for up to 5 more flights at even a higher price per mission, and SpaceX agreed to accept this award. My question was: why did SpaceX choose to incur this additional obligation? SpaceX could have declined, I thought. Are you saying that the original 2014 contract obligated SpaceX to continue flying Crew Dragon for as long as NASA wants to keep buying the service? How did the 2014 contract determine the prices for the missions after the original six?

Offline DanClemmensen

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Re: Commercial Crew - Discussion Thread 3
« Reply #749 on: 09/05/2022 11:24 pm »
The second part, the modest proposal, is facetious sarcasm, but I am serious about the first part. The additional flights Boeing is missing out on are more valuable not to have because Boeing can declare those as unexpected losses of income on their taxes. It's part of why corporations pay little or no taxes.
If Boeing's accountants are still carrying the NPV of a 50% chance of winning flights after the first six on the books, then they should fire the accountants. The first six flights are guaranteed at a fixed price and the forward-looking revenue can be assets, but flights after that are basically sales projections, and given the hard limit of six Atlas V, the NASA sole-source to SpaceX does not have a material effect on the likelihood of sales of Starliner missions beyond the first six. If they booked the projected revenue, they need to start writing it down regardless of this new SpaceX award.

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #750 on: 09/05/2022 11:56 pm »
You are wrong.  Boeing isnít guaranteed anything beyond the basic contract.
You are right NASA is under no obligation beyond the basic contract, but NASA does not make the tax laws.  Do you work for Boeing? Are there people who post here that work for Boeing that you know of?

And Boeing can only write off what it is contracted for.  Not unguaranteed future work.  It hasnít risked anything on it or spent money towards it.
I agree to disagree with you about the tax law until proven otherwise.

Doesnít matter.  You have demonstrated a lack of understanding in many fields and this is just another one to add to the list.

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #751 on: 09/06/2022 12:00 am »

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.


Because it is an IDIQ contract and NET prices/terms were already negotiated in the basic contract.  That is the same way NLS and CRS contracts work.
I know this is the second sole-source extension to the original IDIQ contract. The original fixed-price contract was for development (with milestone payments) plus two guaranteed operational missions at a fixed per-misson price, plus up to four additional missions at that same per-mission price. The first sole-source extension was for up to three additional missions at a different per-mission price. SpaceX agreed to this extension: NASA did not have the legal power to require SpaceX to fly these missions. Later, NASA awarded SpaceX this new second IDIQ extension for up to 5 more flights at even a higher price per mission, and SpaceX agreed to accept this award. My question was: why did SpaceX choose to incur this additional obligation? SpaceX could have declined, I thought. Are you saying that the original 2014 contract obligated SpaceX to continue flying Crew Dragon for as long as NASA wants to keep buying the service? How did the 2014 contract determine the prices for the missions after the original six?

 It is just ordering more services under the same contract via amid.   Just easier.  Starship is far from being a replacement
« Last Edit: 09/06/2022 12:06 am by Jim »

Offline DanClemmensen

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Re: Commercial Crew - Discussion Thread 3
« Reply #752 on: 09/06/2022 12:13 am »

I do not understand why SpaceX accepted this award at this price. Crew Dragon and possibly Cargo Dragon are likely to be the last Falcon flights and will require SpaceX to keep the entire Falcon and Dragon infrastructure in place until the end of 2030.


Because it is an IDIQ contract and NET prices/terms were already negotiated in the basic contract.  That is the same way NLS and CRS contracts work.
I know this is the second sole-source extension to the original IDIQ contract. The original fixed-price contract was for development (with milestone payments) plus two guaranteed operational missions at a fixed per-misson price, plus up to four additional missions at that same per-mission price. The first sole-source extension was for up to three additional missions at a different per-mission price. SpaceX agreed to this extension: NASA did not have the legal power to require SpaceX to fly these missions. Later, NASA awarded SpaceX this new second IDIQ extension for up to 5 more flights at even a higher price per mission, and SpaceX agreed to accept this award. My question was: why did SpaceX choose to incur this additional obligation? SpaceX could have declined, I thought. Are you saying that the original 2014 contract obligated SpaceX to continue flying Crew Dragon for as long as NASA wants to keep buying the service? How did the 2014 contract determine the prices for the missions after the original six?

 It is just ordering more services under the same contract via amid.   Just easier.  Starship is far from being a replacement
I did not mention Starship.  A possible CCP alternative that somehow involves Starship is a completely different subject.

Yes, it's a contract amendment. I am trying to figure out why SpaceX agreed to it.

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #753 on: 09/06/2022 12:16 am »
It was easy to do and keeping Dragon and Falcon going is because Starship is not a viable replacement .
Why would they decline?
« Last Edit: 09/06/2022 12:16 am by Jim »

Offline DanClemmensen

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Re: Commercial Crew - Discussion Thread 3
« Reply #754 on: 09/06/2022 12:55 am »
It was easy to do and keeping Dragon and Falcon going is because Starship is not a viable replacement .
Why would they decline?
We are talking about missions after 2028, here. By that time, there is a real possibility that CRS and CCP are the only remaining customers for Dragon and for F9. Under these circumstances, SpaceX would need to keep the entire Dragon and F9 infrastructures functioning to support a total of about four flights per year, which means those four flights must pay the entire operational costs of that infrastructure. I don't see how the mission price in the ammendment can support that infrastructure at four flights per year.

SpaceX may or may not agree with you about Starship as a viable replacement: I don't know. I am not knowledgeable enough to assess it, but SpaceX claims that they will have crewed Starship and Cargo Starship functioning by then, and I'm fairly sure their engineers can come up with something that uses them in conjunction with a "taxi" if Starship cannot dock with ISS and other stations.

Offline Jim

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Re: Commercial Crew - Discussion Thread 3
« Reply #755 on: 09/06/2022 01:02 am »
Obviously starship is not going to be replacing either since they are going to be flying crew, cargo and satellites then.

Offline DanClemmensen

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Re: Commercial Crew - Discussion Thread 3
« Reply #756 on: 09/06/2022 01:17 am »
Obviously starship is not going to be replacing either since they are going to be flying crew, cargo and satellites then.
What system will be flying those? If Starship succeeds, SpaceX asserts that by 2028 it will be flying all of the payloads that are currently flying on F9 with the exception of CRS, CCP, and possibly CLD crew. They have not told us how they can replace those three.

If Starship fails to meet expectations, then F9 will still be flying a lot.

Offline Steven Pietrobon

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Re: Commercial Crew - Discussion Thread 3
« Reply #757 on: 09/06/2022 05:59 am »
Price per seat went from $55M to $64M to $72M. That's probably to account for inflation.

OK, I did some fact checking. The initial award to SpaceX was $2,600M. This increased to $3,490.9M for Crew-7 to Crew-9 and $4,927.3M for Crew-10 to Crew-14. Thus I get (3490.9-2600)/(3*4) = $74.2M/seat for Crew-7 to Crew-9 and (4927.3-3490.9)/(5*4) = $71.8M/seat for Crew-10 to Crew-14! Thus, there was no price increase, but a price decrease!

https://www.nasa.gov/feature/nasa-awards-spacex-additional-crew-flights-to-space-station
https://www.nasa.gov/feature/nasa-awards-spacex-more-crew-flights-to-space-station
« Last Edit: 09/06/2022 05:59 am by Steven Pietrobon »
Akin's Laws of Spacecraft Design #1:  Engineering is done with numbers.  Analysis without numbers is only an opinion.

Offline Steven Pietrobon

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Re: Commercial Crew - Discussion Thread 3
« Reply #758 on: 09/06/2022 06:10 am »
Here's a table of NASA spending on CCDEV. Up to to 2030, it will be $10,976.9M which works out to $137.2M/seat, including development costs.

CCDEV          CCDEV1 CCDEV2 CCDEV2+ CCiCap  CPC  CCiCap2 CCtCAP  Total
------------------------------------------------------------------------
Boeing         $18.0  $92.3  $20.6  $460.0  $10.0  $20.0  $4200  $4820.9
SpaceX          $0.0  $75.0   $0.0  $440.0   $9.6  $20.0  $2600  $3144.6
SNC            $20.0  $80.0  $25.6  $212.5  $10.0  $15.0          $363.1
Blue Origin     $3.7  $22.0                                        $25.7
ULA             $6.7                                                $6.7
Paragon         $1.4                                                $1.4
------------------------------------------------------------------------
Total          $49.8  $269.3 $46.2 $1112.5  $29.6  $55.0  $6800  $8362.4

                      CCtCAP  3 Flts   5 Flts
CCDEV         Total    Extra  1-3-22  31-8-22   Total
------------------------------------------------------
Boeing       $4820.9  $287.2                   $5108.1
SpaceX       $3144.6  $124.9  $766.0  $1436.4  $5471.9
Other         $396.9                            $396.9
------------------------------------------------------
Total        $8362.4                          $10976.9


8 Sep 2022 Updated Table to reflect extra funds received by SpaceX for CCtCAP.
« Last Edit: 09/08/2022 07:35 am by Steven Pietrobon »
Akin's Laws of Spacecraft Design #1:  Engineering is done with numbers.  Analysis without numbers is only an opinion.

Offline yg1968

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Re: Commercial Crew - Discussion Thread 3
« Reply #759 on: 09/06/2022 10:11 pm »
It was easy to do and keeping Dragon and Falcon going is because Starship is not a viable replacement .
Why would they decline?
We are talking about missions after 2028, here. By that time, there is a real possibility that CRS and CCP are the only remaining customers for Dragon and for F9. Under these circumstances, SpaceX would need to keep the entire Dragon and F9 infrastructures functioning to support a total of about four flights per year, which means those four flights must pay the entire operational costs of that infrastructure. I don't see how the mission price in the ammendment can support that infrastructure at four flights per year.

SpaceX may or may not agree with you about Starship as a viable replacement: I don't know. I am not knowledgeable enough to assess it, but SpaceX claims that they will have crewed Starship and Cargo Starship functioning by then, and I'm fairly sure their engineers can come up with something that uses them in conjunction with a "taxi" if Starship cannot dock with ISS and other stations.

As I have told you before, during a press conference Jessica Jensen of SpaceX and Steve Stich of NASA said that there was no issues for SpaceX to continue Dragon and Falcon 9 until 2030.

It's at 24 and 41 minutes of this video:

« Last Edit: 09/06/2022 10:53 pm by yg1968 »

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