Author Topic: End of U.S. Launch Year  (Read 27137 times)

Offline edkyle99

  • Expert
  • Senior Member
  • *****
  • Posts: 15391
    • Space Launch Report
  • Liked: 8566
  • Likes Given: 1356
Re: End of U.S. Launch Year
« Reply #40 on: 01/05/2008 05:15 am »
Quote
Frediiiie - 4/1/2008  8:59 PM
What I'm saying is that something needs to be done in the interests of keeping ANY sort of US launch industry going.
What is being done?

The U.S. Government is planning on spending $31.8 billion for 137 EELV launches by 2020, an average of $232.12 million per launch.

That's a lot of subsidy propping up ULA.  What more can be done?  This is the so-called "Free Trade" era.  Without U.S. Government contracts, there would be no U.S. launch vehicle production.  Not as long as wages are lower elsewhere.  

The high EELV costs may provide opportunity for others, like SpaceX, who think they can offer lower-cost launch services for the U.S. Government.  But, again, none will survive without selling to the U.S. Government.  SpaceX won't be able to compete with India or China on price.

 - Ed Kyle

Offline Frediiiie

  • Member
  • Full Member
  • *
  • Posts: 102
  • Liked: 0
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #41 on: 01/05/2008 11:19 pm »
Space launch is a hi tec business. Labour costs are not that critical a factor.
More important is innovation  and finding ways of bringing costs down through the application of new technologies, system improvements, Design work that is cost conscious, and so on.

Up till now the majors won't get out of bed without a contract up front.
It's been that way since ww2, but the launch market has changed in recent times.
There is the non commercial NASA market where govt contractors bid for monumental projects like Ares 1 & V. (or parts thereof.)
Implicit in the contracts is the assumption that the designs will be world leading and cutting edge, and it doesn't matter much if the costs blow out as the government is picking up the tab. The important thing is that the work be elegant.
Then there is the commercial market where all the customer wants is to get his sat into space.
And the two markets are drifting apart.

I see several ways ahead for the majors.
1/ either or both of the majors could select and fund their own lean in house teams to  build their own  "Mac Truck" launcher to compete directly with SpaceX Sealaunch the Russians et al in the commercial market.
2/ Do system wide reviews of everything to do with Atlas & Delta to find ways to reduce costs, and improve the programs to the point where they can compete.
3/ Stay where they are and surrender a market segment that may one day move on up from being the minor part of the market to being dominant.

Offline Jim

  • Night Gator
  • Senior Member
  • *****
  • Posts: 37440
  • Cape Canaveral Spaceport
  • Liked: 21450
  • Likes Given: 428
Re: End of U.S. Launch Year
« Reply #42 on: 01/05/2008 11:28 pm »
Quote
Frediiiie - 5/1/2008  7:19 PM

Space launch is a hi tec business. Labour costs are not that critical a factor.


Completely wrong.   Space launch is not high tech.  It is dirty and current systems are labor intensive.   Labor costs are everything.

Offline Jim

  • Night Gator
  • Senior Member
  • *****
  • Posts: 37440
  • Cape Canaveral Spaceport
  • Liked: 21450
  • Likes Given: 428
Re: End of U.S. Launch Year
« Reply #43 on: 01/05/2008 11:32 pm »
Quote
Frediiiie - 5/1/2008  7:19 PM

There is the non commercial NASA market where govt contractors bid for monumental projects like Ares 1 & V. (or parts thereof.)
Implicit in the contracts is the assumption that the designs will be world leading and cutting edge, and it doesn't matter much if the costs blow out as the government is picking up the tab. The important thing is that the work be elegant.

Wrong again.  Ares are not cutting edge.  They are using old designs and old hardware andare not elegant but Kludges.   The high costs are due to the labor intensive designs

Offline kevin-rf

  • Elite Veteran
  • Senior Member
  • *****
  • Posts: 8823
  • Overlooking the path Mary's little Lamb took..
  • Liked: 1318
  • Likes Given: 306
Re: End of U.S. Launch Year
« Reply #44 on: 01/05/2008 11:33 pm »
Since when are labor costs not the critical factor? What do you think the fixed costs are? They are the salaried employees who are needed to launch. They get paid the same if you fly or do not fly. As far as I know there is no such thing as hire a temp launch crew that you call and only pay everytime you want to fly.
If you're happy and you know it,
It's your med's!

Offline Jim

  • Night Gator
  • Senior Member
  • *****
  • Posts: 37440
  • Cape Canaveral Spaceport
  • Liked: 21450
  • Likes Given: 428
Re: End of U.S. Launch Year
« Reply #45 on: 01/05/2008 11:39 pm »
Quote
Frediiiie - 5/1/2008  7:19 PM

I see several ways ahead for the majors.
1/ either or both of the majors could select and fund their own lean in house teams to  build their own  "Mac Truck" launcher to compete directly with SpaceX Sealaunch the Russians et al in the commercial market.
2/ Do system wide reviews of everything to do with Atlas & Delta to find ways to reduce costs, and improve the programs to the point where they can compete.


1.  They already exist.  They are the EELV's

2.  US wages and unions drive up the labor costs.  So does the mission assurance requirements of the main customer, the US gov't.  Since the US Gov't self insures, it has the contractors do extra work.

Offline pippin

  • Regular
  • Senior Member
  • *****
  • Posts: 2575
  • Liked: 312
  • Likes Given: 45
Re: End of U.S. Launch Year
« Reply #46 on: 01/06/2008 12:49 am »
Quote
Jim - 6/1/2008  1:39 AM

Quote
Frediiiie - 5/1/2008  7:19 PM

I see several ways ahead for the majors.
1/ either or both of the majors could select and fund their own lean in house teams to  build their own  "Mac Truck" launcher to compete directly with SpaceX Sealaunch the Russians et al in the commercial market.
2/ Do system wide reviews of everything to do with Atlas & Delta to find ways to reduce costs, and improve the programs to the point where they can compete.


1.  They already exist.  They are the EELV's

2.  US wages and unions drive up the labor costs.  So does the mission assurance requirements of the main customer, the US gov't.  Since the US Gov't self insures, it has the contractors do extra work.
2. Given the curren exchange rates: Do you really think labor cost is more expensive in the US than in Europe? To have the mission assurance done as paid work by the contractor shoudln't make the system less competitive.

Regarding subsidies: edkyle is right. In the end the subsidizing party loses. At least US satellite makers and operators should profit from cheaper launches. If I look at launch prices vs. systems prices there should be more value in that than in the launch itself.

Frediiie, why on earth do you believe getting rid of competition (ULA merger) actually gets down costs. There is tons of theoretical and empirical data pointing in the other direction.

Offline quark

  • Veteran
  • Full Member
  • ****
  • Posts: 444
  • Liked: 0
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #47 on: 01/06/2008 04:12 am »
Everyone on this thread is completely missing the boat.  The international "market" for satellite launch is very far from a free market in the Freidman sense.  Speaking of price as having a relationship to cost and speaking of cost competitiveness is meaningless.  Other than the US systems where all the budget numbers are public, it is almost impossible to get any sense of real cost.  

For example, Proton is made by Energia, a GOR owned entity.  I doubt anyone (even in Russia) knows what the total unit cost is (including development, fixed and marginal).  They simply price it so as to keep the manifest full and cash coming in.  Profit has no meaning.

Ariane is in a similar state although slightly closer to a capitalist model.  It has all development and fixed cost completely covered, but it is not really required to be profitable.  For most of its existence, the majority owner was the french government although I believe that has recently changed.

On the other hand, the US systems are owned by private corporations which are required (by shareholders) to deliver reasonable returns.  Therefore selling at a loss is not really an option.  Right now, since price will always favor those who don't don't have to cover costs, the only way US vehicles get commercial launches is based on technical superiority (reliability).  Both DII and Atlas V can command a reliability premium in the marketplace.

If the US wants domestic launchers to gain market share there are 2 options:
1) cover US companies for losses so they can price-to-win.  This is the approach used by Ariane and Proton
2) Pressure the rest of the world to privatize their launch businesses

In the meantime, we can have the GOR and ESA subsidize the launching of the world's satellites.

Offline WHAP

  • Member
  • Full Member
  • ****
  • Posts: 795
  • Liked: 105
  • Likes Given: 8
Re: End of U.S. Launch Year
« Reply #48 on: 01/06/2008 02:56 pm »
Quote
edkyle99 - 4/1/2008  11:15 PM

The U.S. Government is planning on spending $31.8 billion for 137 EELV launches by 2020, an average of $232.12 million per launch.

That's a lot of subsidy propping up ULA.  
 - Ed Kyle

All of that money is not going to ULA.  Jim also mentioned that the government self insures and, as a result, (my words) pays other contractors for mission assurance. I was not able to find specifics relative to EELV, but the Aerospace Corporation, for example, receives significant amounts of money from the government.  Although these contracts are included in the total program costs, they do not contribute to the development, launch operations, or infrastructure maintenance.  If anyone has insight into the value of Aerospace's contracts relative to EELV, I'd love to see it, but I was not successful with a quick Google search.
ULA employee.  My opinions do not necessarily reflect those of my employer.

Offline Jim

  • Night Gator
  • Senior Member
  • *****
  • Posts: 37440
  • Cape Canaveral Spaceport
  • Liked: 21450
  • Likes Given: 428
Re: End of U.S. Launch Year
« Reply #49 on: 01/06/2008 03:56 pm »
Quote
WHAP - 6/1/2008  10:56 AM
 If anyone has insight into the value of Aerospace's contracts relative to EELV, I'd love to see it, but I was not successful with a quick Google search.

Aerospace has only one contract with SMC.  It cover GSE&I for USAF space systems and not just EELV.

Offline Jirka Dlouhy

  • Veteran
  • Full Member
  • ***
  • Posts: 315
  • Kladno, Czech Republic
  • Liked: 2
  • Likes Given: 5
Re: End of U.S. Launch Year
« Reply #50 on: 01/06/2008 06:18 pm »
Quote
quark - 5/1/2008  11:12 PM


For example, Proton is made by Energia.

Proton isnīt made by Energia, but it is made by Khrunichev.

Offline edkyle99

  • Expert
  • Senior Member
  • *****
  • Posts: 15391
    • Space Launch Report
  • Liked: 8566
  • Likes Given: 1356
Re: End of U.S. Launch Year
« Reply #51 on: 01/07/2008 12:37 am »
Quote
quark - 5/1/2008  11:12 PM

Everyone on this thread is completely missing the boat.  The international "market" for satellite launch is very far from a free market in the Freidman sense. ...

For example, Proton is made by Energia, a GOR owned entity.  I doubt anyone (even in Russia) knows what the total unit cost is (including development, fixed and marginal).  They simply price it so as to keep the manifest full and cash coming in.  Profit has no meaning.
Proton is made by Krunichev, as others have noted.  It launches Russian government payloads as well as commercial payloads, so the Russian government is clearly going to fund Proton to some extent, just as the U.S. does with its launch vehicles.

Quote
Ariane is in a similar state although slightly closer to a capitalist model.  It has all development and fixed cost completely covered, but it is not really required to be profitable.  For most of its existence, the majority owner was the french government although I believe that has recently changed.
Ariane is Europe's assured access to space, used to launch defense and civil payloads, so it is supported by European governments, just as Russia supports Proton and the U.S. supports EELVs, etc.  There are fewer European government payloads than U.S. government payloads, so Europe must aggressively sell commercial launches to keep its program viable.

Quote
On the other hand, the US systems are owned by private corporations which are required (by shareholders) to deliver reasonable returns.  Therefore selling at a loss is not really an option.  Right now, since price will always favor those who don't don't have to cover costs, the only way US vehicles get commercial launches is based on technical superiority (reliability).  Both DII and Atlas V can command a reliability premium in the marketplace.
Delta II is one of the world's two most reliable expendable launch vehicles in its payload class.  The other, which is statistically tied with Delta II for all practical purposes, is Soyuz.

I doubt that Atlas V commands premiums.  It has the same demonstrated success rate as Ariane 5 ECA (12 launches, 11 successes) and is only fractionally ahead of Proton M/Briz M statistically speaking.  All three of these are essentially tied, along with China's CZ-3(A) series and Japan's H-2(A) in demonstrated and predicted reliability.
Quote
If the US wants domestic launchers to gain market share there are 2 options:
1) cover US companies for losses so they can price-to-win.  This is the approach used by Ariane and Proton
2) Pressure the rest of the world to privatize their launch businesses

In the meantime, we can have the GOR and ESA subsidize the launching of the world's satellites.

As I noted, the U.S. government already subsidizes EELV and other launch vehicle programs.  The U.S. government has set up excessive costs by keeping two parallel EELV programs, along with Delta II and others, alive at two launch centers.  Where Ariane has one pad, EELV has four.  Where Ariane has two upper stage options, EELV has three, etc.    

 - Ed Kyle

Offline Frediiiie

  • Member
  • Full Member
  • *
  • Posts: 102
  • Liked: 0
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #52 on: 01/07/2008 02:33 am »
Well done Jim,
I'm sure  the alt space community will be pleased to know that low tech launch vehicles are possible.
I think what you meant was relatively low tech.
And sure, that was the original Ares concept.  Didn't last long, though, did it?
But Ed Kyle spelt out what needs to happen to bring costs down.
Dump one EELV
Close 1 launch centre.
Close 3 pads.
and that's a good start.
The question is, does the industry want to compete or not.

Offline Frediiiie

  • Member
  • Full Member
  • *
  • Posts: 102
  • Liked: 0
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #53 on: 01/07/2008 02:44 am »
Pippin said
"Frediiie, why on earth do you believe getting rid of competition (ULA merger) actually gets down costs. There is tons of theoretical and empirical data pointing in the other direction."

You're perfectly correct. But when you're one of only two people in the market and there's a good chance the govt. in their infinite wisdom might reach out the mighty fickle finger and tap one of you and say
"You're out of the game",
it becomes less about classical economics and more about saving your investment (and perceptions.)
"See we're trying to do something."
That's where the majors are at. There's so much invested in their two launch systems that needs to be protected that survival is all it's about.

Offline Frediiiie

  • Member
  • Full Member
  • *
  • Posts: 102
  • Liked: 0
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #54 on: 01/07/2008 02:52 am »
Labour Costs.
It's worth dipping back into history.
IBM, in its younger days, always paid well about the market price for the best people. Watson argued his people were his capital. And it worked for him for a long time.
IBM only came undone when the market changed. The computer business became less about intellectual capital and more about production lines.

The launch business is still a business based around intellectual capital, so labour costs are only a problem if you've got 10 people trying to do a job that can be done by one.
I've changed my mind. Perhaps labour costs are a problem.

Offline Frediiiie

  • Member
  • Full Member
  • *
  • Posts: 102
  • Liked: 0
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #55 on: 01/07/2008 03:32 am »
Quark said
"Everyone on this thread is completely missing the boat. The international "market" for satellite launch is very far from a free"
Perfectly true.
But all launchers are subsidised so in that sense there is some sort of equal competition.
All anyone can complain about it that "Their" subsidy is not as big as the guy in the next country. (Which is what a lot of people here are doing.)
If you're happy with this situation that's fine.
If you would like to see a real free market then you need to work towards it.
How?
First you need to recognise that there is no incentive under a subsidised system for the normal efficiencies that drive a free market. Why should Boeing or LM work to lower costs? All that would do would be to reduce their government subside (horror)
You can drive towards a free market a couple of ways.
1/ A business chooses to change their management and starts pushing for efficiencies and cost reductions. In other words they act *as if* they were in a free market. Eventually this forces competition on the market as everybody else scrambles to catch up.
Personally I can't see this happening. The long term gain wouldn't compensate for the short term pain.
2/ Government could force competition. Particularly in a situation where there are 2 or more launch suppliers, by offering incentives, spending money to find cheaper ways of doing stuff, and so on.  
I can't see this happening either.
All I can do is point out two companies.
One makes premiun champagne that sells at a profit of $1,000 a bottle.
The other makes a popular soft drink where the profit is a fraction of a cent a bottle.
Which company would you rather be?

Offline Antares

  • ABO^2
  • Senior Member
  • *****
  • Posts: 5181
  • Done arguing with amateurs
  • Liked: 371
  • Likes Given: 228
Re: End of U.S. Launch Year
« Reply #56 on: 01/07/2008 04:32 am »
Frediiiie, you better be a college student or lower.

Quote
2) What if SpaceX actually get's their act together?

3) Space launch is a hi tec business. Labour costs are not that critical a factor.

4) does the industry want to compete or not.

5) when you're one of only two people in the market and there's a good chance the govt might tap one of you and say "You're out of the game",

6) so labour costs are only a problem if you've got 10 people trying to do a job that can be done by one.
I've changed my mind. Perhaps labour costs are a problem.

7) Why should Boeing or LM work to lower costs? All that would do would be to reduce their government subside (horror)

8) A business chooses to change their management and starts pushing for efficiencies and cost reductions.

9) Government could force competition.
2) Then the more expensive of Atlas or Delta may be downselected.  In this case, free market doesn't hold because of Washington lobbying.

3) Yeah, in San Diego, Denver and Decatur the machines are so high tech and automated that the government feeds checks in one end and rockets come out the other.  Labor is only needed for the annual refill of unobtainium.

4) Of course it does, but it can't because of American labor rates.  Stop ignoring practical reality.

5) There's no chance of that as long as Assured Access is a DoD policy.

6) Atlas and Boeing have free rein to lay off people unlike NASA.  They're trying to make money for their shareholders.  You don't think they try to cut every job and penny they can, especially when the last two machinists strikes have done nothing?

7) Nice circular logic.  Any subsidy worth its ink is written to share cost-cutting benefits between the government and the contractor.  Your view is too simplistic.

8) Why don't you think this has already been done?  Again, you look at the world with your simplistic model.  It doesn't fit, therefore the world must be wrong, not your model.

9) The government did that, but the market evaporated.  Go read some more threads.

I try to give newbs the benefit of the doubt because we were all once newbs.  But your free market luddism is just ignorant.  Why are you ignoring data?

And if you're going to continue to do so, please stop hijacking threads.  My "ignore poster" finger is getting itchy again.
If I like something on NSF, it's probably because I know it to be accurate.  Every once in a while, it's just something I agree with.  Facts generally receive the former.

Offline Antares

  • ABO^2
  • Senior Member
  • *****
  • Posts: 5181
  • Done arguing with amateurs
  • Liked: 371
  • Likes Given: 228
Re: End of U.S. Launch Year
« Reply #57 on: 01/07/2008 05:07 am »
Quote
Jim - 6/1/2008  10:56 AM
Quote
WHAP - 6/1/2008  10:56 AM
 If anyone has insight into the value of Aerospace's contracts relative to EELV, I'd love to see it, but I was not successful with a quick Google search.
Aerospace has only one contract with SMC.  It cover GSE&I for USAF space systems and not just EELV.
Check the last annual report here: http://www.aero.org/corporation/2006AR.pdf

Or maybe it's buried in: http://www.whitehouse.gov/omb/expectmore//detail/10003204.2005.html
But I can't tell.

I also found www.usaspending.gov which has lots of data, but little info.
If I like something on NSF, it's probably because I know it to be accurate.  Every once in a while, it's just something I agree with.  Facts generally receive the former.

Offline Jim

  • Night Gator
  • Senior Member
  • *****
  • Posts: 37440
  • Cape Canaveral Spaceport
  • Liked: 21450
  • Likes Given: 428
Re: End of U.S. Launch Year
« Reply #58 on: 01/07/2008 11:24 am »
Quote
Frediiiie - 6/1/2008  10:33 PM
Close 1 launch centre.
Close 3 pads.
and that's a good start.
The question is, does the industry want to compete or not.

Can't be done.  If you don't know why, then you have no credibility and your posts are meaningless

Offline TrueGrit

  • Regular
  • Full Member
  • ***
  • Posts: 345
  • Liked: 10
  • Likes Given: 0
Re: End of U.S. Launch Year
« Reply #59 on: 01/07/2008 04:28 pm »
Agree, you can't shutdown Vandenbergh...  The orbits acheived from launching there are not possible from the Cape.  To suggest otherwise indicates a signifcant lack of knowledge.  SLC6 and SLC3E are cumilations of decades of DoD and NASA desire to have true west coast heavy lift capability.  There's a whole train of NASA earth sceince missions that wouldn't be possible if Vandenbergh didn't exist.

Tags:
 

Advertisement NovaTech
Advertisement Northrop Grumman
Advertisement
Advertisement Margaritaville Beach Resort South Padre Island
Advertisement Brady Kenniston
Advertisement NextSpaceflight
Advertisement Nathan Barker Photography
1