AvWeek reporting 9(!) new SpaceX contracts, 2-3 Heavies

[obi-wan]

But not too small to make F9 look pretty darn good. 100% successful >primary< payload delivery on the first twelve launches is impressive given that you would expect the highest failure rate early in the life cycle with teething problems. Neither Pegasus nor Taurus achieved that record, and they were less complex designs. No wonder customers are lining up.

Neither did Ariane 5, either! Several early failures.

FWIW, a good way of guesstimating the reliability in the case of no main payload failures (because nothing is 100% reliable) is to assume half a failure... So 12 flights is 12/12.5... About 96% reliability, conservatively speaking. Just a guesstimate, though. Could also take a Bayesian approach which would give much the same answer.

12 missions without a failure is an 87.4% reliability at 80% confidence. It's a 94.4% reliability at 50% confidence level.

[sghill]

SFN is reporting that Ariane has six new launch contracts, all in the F9 sweet spot of <3.5 tons to GTO.  So I wouldn't call this SpaceX beating up Ariane just yet.

That said, it's been stated that the new launch contracts were at a sharply discounted rate compared to prior contracts, which is directly attributable to the F9's pricing.

So yes, SpaceX is beating up on ESA - they are forcing them to sell their services at an even greater loss.

Hold on,  "loss" or discount?  The distinction is vital.  Can you provide a link to where they are selling launches at a loss versus selling them at a lower profit? 

Also, small changes in the Euro/US Dollar exchange rate translates into wide variances in margin since Arianespace prices its launches in US dollars.  A $0.10 variance in exchange rates translates into a 10 million Euro difference in launch pricing, so a downward trend against the dollar (which we've seen throughout 2014) gives them considerable wiggle room on pricing.  Also, they had actually raised prices, so they may be going back down to where they were. 

And separately, here's a link to Arianespace asking ESA for higher subsidies back in February in response to exchange rates and SpaceX competition:  http://aviationweek.com/space/arianespace-esa-we-need-help 

The article also discusses just how bad the financial situation is with the Soyuz launches by Arianespace from Guiana Space Center.

[abaddon]

Hold on,  "loss" or discount?  The distinction is vital.  Can you provide a link to where they are selling launches at a loss versus selling them at a lower profit? 

Arianespace is already subsidized to the tune of around 100 million euros a year as per the link you yourself cited.  If you imagine around 10 launches a year that's roughly -10 million euros per launch, which is the definition of "at a loss".  It remains to be seen how the reduced prices on these newly signed launch contracts are going to affect the bottom line, but given they were already asking for increased subsidies in February it seems likely the recent discounts are going to come directly out of European taxpayer's pockets.

Based on the article it sounds like they used to lose more money per launch in the previous decade than now.  I'm not sure when (or if) they were most recently profitable.

[ncb1397]

rianespace commercial launch consortium on April 12 reported a higher-than-expected 1.013 billion euros ($1.3 billion) in revenue for 2011, up 12.9 percent over 2010, with a profit of 1.6 million euros.

The Evry, France-based company’s final revenue figure, released following a meeting of its shareholders, was helped by 145 million euros in support payments in 2011 made by the 19-nation European Space Agency (ESA).

ESA governments agreed to provide Arianespace 217 million euros, covering 2011 and 2012, to permit the company to avoid the losses it posted in 2009 and 2010. Having allocated two-thirds of that sum to its 2011 accounts, Arianespace will have 72 million euros remaining for 2012.

http://www.spacenews.com/article/esa-subsidy-boosts-arianespace-black

From what I can tell, Arianespace is usually in the red before subsidies which can barely boost them into the black(barely and sometmes not at all). What is ironic though is that this is exactly what the Europeans accuse SpaceX of doing - dumping launches on the international market below cost. Maybe they are just peeved that someone else has apparently stolen their playbook?

[abaddon]

From what I can tell, Arianespace is usually in the red before subsidies which barely boosts them into the black. What is ironic though is that this is exactly what the Europeans acuse SpaceX of doing - dumping launches on the international market below cost.

Loudly proclaiming another countries competitor is doing something you are yourself doing in righteous indignation is SOP for the average government.  I'd be more surprised if they weren't.

If it ever becomes more than bluster then there is something to sit up and take notice about.

[meekGee]

"Loss" is difficult to define here.  Are said $100M getting divided among the launches, or are they supporting infrastructure and (ahem...) assured access to space?

The tell should be:  if AS were to suddenly get 5 more flights at this rate, would it cause them to require less or more subsidy?

[Herb Schaltegger]

To try to bring this thread back on-topic (that is, SpaceX's new business, not Arianepace subsidies), has any more information leaked out regarding the customers? To my mind, SpaceX will truly be in "the big leagues" when they book some of the heavier Ka-band DTH television satellites for western hemisphere customers like Directv or Dish Network. Those birds weigh upwards of 6 tonnes at launch and so, presumably, would be ideal payloads for Falcon Heavy. So far, Directv has had successful launches with all the existing market players (Arianespace, ILS and SeaLaunch). With ILS and SeaLaunch in such trouble, it would be nice to see a large, American customer like them book a payload with SpaceX.

[abaddon]

"Loss" is difficult to define here.  Are said $100M getting divided among the launches, or are they supporting infrastructure and (ahem...) assured access to space?

If they charged 10 million more per flight there would be no subsidy.  Why not call a spade a spade?  The 100 million euros per year allows them to lower their launch prices by ~10 million a year.  (That in and of itself is a simplification, since they operate three different launchers.  But the general point still stands).  The previous article also indicated they were asking for larger subsidies to be able to remain price competitive.  Are you going to argue that the costs of the supporting infrastructure have unexpectedly increased and that's why the increased subsidy is required?

But as Herb notes this is really continuing to go OT.

To try to bring this thread back on-topic (that is, SpaceX's new business, not Arianepace subsidies), has any more information leaked out regarding the customers?

We've heard of only one new contract (that is presumably part of the nine) that I am aware of.  Was hoping we'd know more by now...

[sghill]

Hold on,  "loss" or discount?  The distinction is vital.  Can you provide a link to where they are selling launches at a loss versus selling them at a lower profit? 

Arianespace is already subsidized to the tune of around 100 million euros a year as per the link you yourself cited.  If you imagine around 10 launches a year that's roughly -10 million euros per launch, which is the definition of "at a loss".  It remains to be seen how the reduced prices on these newly signed launch contracts are going to affect the bottom line, but given they were already asking for increased subsidies in February it seems likely the recent discounts are going to come directly out of European taxpayer's pockets.

Based on the article it sounds like they used to lose more money per launch in the previous decade than now.  I'm not sure when (or if) they were most recently profitable.

I agree with the sentiment of your response, but the EU may consider the non-monetary benefits of that 100 Euro investment (such as assured access to space) to be higher than the monetary figure of the incentive as part of a balanced scorecard.  So the subsidy should really be kept out of the determination of whether it's a loss or not, and only considered as part of the balanced scorecard as a whole.  In other words, when is a spade not a spade? I know that sounds funny, but it's basically how every not-for-profit on the planet has to look at things.

The more accurate question then is: "Including the level of subsidies given to Arianespace, are they losing money after each launch?"  If the answer is yes, then they need more incentive money from ESA to keep solvent.  If the answer is no, then they have pricing wiggle room while still meeting the intent of that incentive (subsidy) money that's given to them.  Hence my question in the first place.

Arianespace & Ariane 6 are already on an uphill battle no matter what year it hits the market.    If SpaceX establishes re-useability then Arianespace can turn out the lights.

Only if the EU politically allows it.  They may force their member states to use Arianespace for launches.

We are only at the very start of this market being disrupted.

[wannamoonbase]

Given the advent of electric propulsion and the dramatic launch-cost reduction offered by Space Exploration Technologies Corp., the operators say, the new Ariane 6 needs to be in service by 2019 or face the risk that Europe’s Arianespace launch consortium will be permanently sidelined.

The letter was signed by six members of the European Satellite Operators Association. Signatories included the chief executives of Intelsat, SES, Eutelsat, Inmarsat, Hispasat and HellasSat.

Ouch!  Based on another recent article http://www.spacenews.com/article/launch-report/41770esa-ministerial-in-doubt-as-france-germany-remain-far-apart-on-future it seems impossible that any Ariane 6 could be ready by 2019 in the most optimistic of timelines.  And as the article also states, the six commercial satellite titans noted above don't want Ariane 5 ME, which could be developed in that time-frame.

Seems like Ariane is between a rock and a hard place.  And if SpaceX can pull off the Falcon Heavy in the next year or two things are really going to get dicey.

The signed letter referenced above says it all.  With or without re-usability by 2019 SpaceX will almost certainly be in full stride with the F9 and FH and sucking up much of the launch market demand.

And importantly they'll have contracts lined up for several years too. 

Arianespace & Ariane 6 are already on an uphill battle no matter what year it hits the market.    If SpaceX establishes re-useability then Arianespace can turn out the lights.

We are only at the very start of this market being disrupted.

[ncb1397]

Arianespace & Ariane 6 are already on an uphill battle no matter what year it hits the market.    If SpaceX establishes re-useability then Arianespace can turn out the lights.

Let's hope not. I hope they put some small landing motors and legs on Ariane 5 and are able to recover boosters with the best of them. If anything, Hydrolox might make a better technology for reusability given that it burns more cleanly than kerolox. That carbon atom really is quite versatile which is a good thing for carbon based lifeforms(thank you carbon) but maybe not so much for creating a chemically simple and clean environment that might simplify maintainance.

[Mader Levap]

  They may force their member states to use Arianespace for launches.

You can subsidy horse buggies against those newfangled "car" thingies only for so long.

I hope they put some small landing motors and legs on Ariane 5 and are able to recover boosters with the best of them.

Haha, no. If anything, they should make Ariane 6 at least partially reusable. Otherwise their rocket will be already obsolete on arrival.

[Comga]

  They may force their member states to use Arianespace for launches.

You can subsidy horse buggies against those newfangled "car" thingies only for so long.

I hope they put some small landing motors and legs on Ariane 5 and are able to recover boosters with the best of them.

Haha, no. If anything, they should make Ariane 6 at least partially reusable. Otherwise their rocket will be already obsolete on arrival.

Can we follow Chris' instructions and take all this Arianespace stuff over to the Ariane 6 thread?
Positing landing engines and legs on an Ariane 5 is Off-Topic here is so very many directions. 
It is acknowleged that we may not get any information to post on these 9 new SpaceX contracts for a very long time, but that's fine.  A new post here should tell forum members that news has come in on this subject.  That's why we have threads and not just a completely open discussion.

[Space Ghost 1962]

... has any more information leaked out regarding the customers? To my mind, SpaceX will truly be in "the big leagues" when they book some of the heavier Ka-band DTH television satellites for western hemisphere customers like Directv or Dish Network. Those birds weigh upwards of 6 tonnes at launch and so, presumably, would be ideal payloads for Falcon Heavy. So far, Directv has had successful launches with all the existing market players (Arianespace, ILS and SeaLaunch).

This will be the first update to look for - which big bird flies on FH. Until then its all off topic noise and some nonsense. Which is it?

Past that, a long way off, likely will be Brownsville pad coming online as a well-tuned "factory" for commercial launch services.

Nothing more really fits. Think SpaceX contracts.

[Stellvia]

9Sept-SpaceX 2014 sales:9 signed, 2 just b4 Euroconsult. Included 2 FH, option 3rd. 4 more flts nearly closed at mtg./3-4 more poss by 31Dec

-- https://twitter.com/TheLurioReport/status/511293072370855936

[su27k]

9Sept-SpaceX 2014 sales:9 signed, 2 just b4 Euroconsult. Included 2 FH, option 3rd. 4 more flts nearly closed at mtg./3-4 more poss by 31Dec

-- https://twitter.com/TheLurioReport/status/511293072370855936

If 9 is just 2014 sales, I suspect we already know most of them: SES-9/10, Thaicom 8, BulgariaSat-1, Inmarsat has 1 firm order and 2 options, plus the rumored JCSat-16 and Koreasat 5A, that's 7 signed and 2 options, including 1 FH.

[LouScheffer]

SFN is reporting that Ariane has six new launch contracts, all in the F9 sweet spot of <3.5 tons to GTO.  So I wouldn't call this SpaceX beating up Ariane just yet.

That said, it's been stated that the new launch contracts were at a sharply discounted rate compared to prior contracts, which is directly attributable to the F9's pricing. 

Overall, this seems good for the market, and perhaps even for SpaceX.  If there are two reputable providers who will launch a 3.5t satellite for $50M, then more folks will build their business plans around this, order more satellites, and get them launched sooner.  But Ariane can only launch a subset of these additional orders since they need to pair each with a heavy satellite, whereas SpaceX can theoretically crank up production (worst case) or get re-use to work (best case). 

[RanulfC]

That tweet, with SpaceX beating up Ariane and taking her lunch launch money, certainly puts the last couple of years' worth Ariane vs. Falcon discussion into the proper context. Musk's words from late November 2012:

http://www.bbc.com/news/science-environment-20389148

Ariane 5 has no chance. ... I don't say that with a sense of bravado but there's really no way for that vehicle to compete with Falcon 9 and Falcon Heavy. If I were in the position of Ariane, I would really push for an Ariane 6. I think that's the right move.. ... Not only can we sustain the prices, but the next version of Falcon 9 is actually able to go to a lower price. So if Ariane can't compete with the current Falcon 9, it sure as hell can't compete with the next one.

And just under two years later, here's the proof. Well done, SpaceX!

Fixed that for you

Randy

[RanulfC]

  They may force their member states to use Arianespace for launches.

You can subsidy horse buggies against those newfangled "car" thingies only for so long.

The analogy is flawed and not applicable. More to the point would be "you can only subsidy your hand-built, very expensive cars against these "mass-produced" and cheaper cars for so long..."

Which points to the real-world that European automobile makers didn't all go out of business against Henry Ford and as much as HE complained about the "subsidies" and government deals he ended up using as much as he could get as well to stay competative.

Keep your "lessons" in perpective

Randy

[simonbp]

What, is Ariane now some sort of "luxury launcher"? Does it have leather-upholstered farings and shiny chrome SRBs?

Before F9 (v.1.1), the equation was either cheap, risky launches on Proton/Zenit or expensive, reliable launches on Ariane/Atlas. Now Falcon appears to be both cheap and reliable, which is why they are making money hand over fist. Unfortunately for competition, none of SpaceX's competitors are able to do both cheap and reliable (though Long March is catching up).