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ULA restructuring after 2014, with an objective of halving launch costs
by
Llian Rhydderch
on 19 Oct, 2014 20:22
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This
article written from an exclusive interview with Tory Bruno, published in the Denver Business Journal, has several aspects.
The Atlas V+ (or Atlas VI, or Atlas V successor, or Delta IV+, whatever) aspects are being discussed in
another thread.
But what about the fundamental
restructuring of the company, its processes and operations? I don't see a good thread where that fits?
How is ULA going to halve their launch costs? What do NSFers have to say about what might change to enable ULA to achieve this goal, and whether and how soon this is achievable? How does the company look after, say, five years if they are successful with this restructuring?
For our purposes here, we can assume that the new rocket, the successor to Atlas V is a part of the equation. But then what?
(Mods feel free to re-title or move this thread if it belongs elsewhere.)
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#1
by
R7
on 19 Oct, 2014 21:21
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How is ULA going to halve their launch costs?
Said quite clearly in the article. Why set up a thread asking people repeat it?
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#2
by
Jim
on 19 Oct, 2014 22:16
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Other than getting cheaper engines, getting rid of unions and not paying overtime, there is not much they can do. The rest is driven by customer requirements. Every vehicle change is reviewed by its customers by participating all the review boarda.
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#3
by
edkyle99
on 19 Oct, 2014 22:21
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The restructuring would really happen later, when the current EELV contract runs out in 2019 or so. What will happen is obvious. The total number of people working on the EELV contract for ULA and for its entire universe of contractors will be cut by half. ULA and its contractors currently build five different rocket stages, three or four different payload fairings, and six different primary propulsion systems. That could, as one example, all be reduced to two stages, one or two payload fairings, and three propulsion systems (including the solid motors). Consider that Mitsubishi currently builds tanks for Delta IV. It might not build tanks for the new rocket - or it could end up building all of the tanks. Contraves builds the biggest Atlas V fairing. It might build all of the fairings for the new rocket, or none.
Etc.
- Ed Kyle
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#4
by
Coastal Ron
on 19 Oct, 2014 22:43
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The advantage that ULA has is that they already have lots of experience and expertise to draw upon for a new system.
One of their disadvantages though is that same organization - they have sustaining cost structures that new companies entering the launch business don't have. Sure, some of the costs for launch companies may be unavoidable, but ULA has been oriented towards one major customer (i.e. the U.S. Government), and have not been competitive in the commercial marketplace for years.
Some companies in the same situation have split off the new operations from the old, since the existing customers may be satisfied with the current operations, so leaving that operation in place makes sense. That also allows the new product group to build their new operations with lower cost structures, and focus on a different customer base.
I'd be surprised if ULA split off the new launcher group from the existing ones though, which means ULA has a very difficult positioning problem ahead of them. Can they lower their overhead costs enough to not only make their new launcher competitive, but also their existing ones competitive against SpaceX? I guess time will tell...
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#5
by
Jim
on 19 Oct, 2014 22:57
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A split from ULA? That is the nonsense I was talking about. ULA is already a split. The new stage is for the existing market. ULA exists to serve the us govt. It can't split off the new stage, it isn't a new launcher, it will use the same upper stages, factory, processing facilities and launch pass.
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#6
by
Coastal Ron
on 19 Oct, 2014 23:23
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A split from ULA? That is the nonsense I was talking about.
Notice I said I'd be surprised if they split the company? I don't know your background, but you may not be aware that this does happen - I've been in management at such a company, so I know the advantages. So me bringing the subject up as one of the many possibilities doesn't merit such a response.
ULA is already a split.
No, it's a merger - hence the name (i.e. UNITED Launch Alliance). And if anything you are bolstering my point that it could be split. Not that it will, but in business EVERYTHING is possible, especially when your future is at stake.
The new stage is for the existing market. ULA exists to serve the us govt.
Yes, if all one does is look to the past for guidance, then yes, ULA has only existed to serve the government.
However if ULA is only positioning this new launcher for the government market, then they are being shortsighted - that pie will be shrinking significantly in the future so they have to use the new launcher to re-enter the commercial marketplace. Unless you think Bruno's goal is to shrink their customer backlog while simultaneously decreasing revenue...
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#7
by
rayleighscatter
on 19 Oct, 2014 23:52
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Could they manage to go from 6 launch complexes to two (east coast and west coast) with long term planning? Could their new rocket be designed to share launch facilities with wither Atlas or Delta?
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#8
by
edkyle99
on 20 Oct, 2014 00:59
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Could they manage to go from 6 launch complexes to two (east coast and west coast) with long term planning? Could their new rocket be designed to share launch facilities with wither Atlas or Delta?
Right now they have four launch complexes, one for each rocket on each coast. If ULA ends up with one (essentially new) rocket, they will certainly be able to slim down to only one West Coast launch pad, due to the low launch rate there (two or less per year on average for Atlas and Delta combined). Where they need the capacity is on the East Coast. That capacity could be provided either by using two launch pads or by adding another mobile launch platform and assembly building at one pad. I suspect that ULA would try to launch the rocket from existing pads, modified accordingly.
- Ed Kyle
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#9
by
rayleighscatter
on 20 Oct, 2014 01:14
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Right now they have four launch complexes, one for each rocket on each coast.
6 Technically. They also have pads for Delta II on both coasts, although SLC-17 at CCAFS has no work . I'm not sure if its still being maintained by ULA though. I also have no idea what their plans are for SLC-2W at Vandy in a few years once the last Delta II launches.
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#10
by
Jim
on 20 Oct, 2014 01:15
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No, it's a merger - hence the name (i.e. UNITED Launch Alliance). And if anything you are bolstering my point that it could be split. Not that it will, but in business EVERYTHING is possible, especially when your future is at stake.
No, it is a split, plain and simple. The Atlas V, Delta IV and Delta II business were split/carved from the parent companies. The merger is a minor part of it. The "monopoly" aspect of it is no different than before. There never was competition in the US launch market, because vehicle capabilities did not overlap. Delta II did medium class, Atlas II did intermediate and Titan IV did heavy.
And I will use the word here because it actually holds true, it is impossible to split off anything from ULA.
With Delta II going away and with common avionics (with common launch control systems), adapters, upper stage engines,and practices coming on line and work on common fairings, common upper stage and a new "common"? booster, there is nothing to split off. There is no separate business.
It is just as silly as Ted and Song were for United and Delta airlines.
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#11
by
Jim
on 20 Oct, 2014 01:18
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6 Technically. They also have pads for Delta II on both coasts, although SLC-17 at CCAFS has no work . I'm not sure if its still being maintained by ULA though.
5. SLC-17 was turned back over to the USAF and is being dismantled.
Here is the block being demolished.
http://afspacemuseum.org/ccafs/CX17/20131227_LC17_BH.jpg
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#12
by
Jim
on 20 Oct, 2014 01:19
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Could they manage to go from 6 launch complexes to two (east coast and west coast) with long term planning? Could their new rocket be designed to share launch facilities with wither Atlas or Delta?
The "new" rocket is replacing one or both them. It will use the same facilities.
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#13
by
Jim
on 20 Oct, 2014 01:26
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Yes, if all one does is look to the past for guidance, then yes, ULA has only existed to serve the government.
However if ULA is only positioning this new launcher for the government market, then they are being shortsighted - that pie will be shrinking significantly in the future so they have to use the new launcher to re-enter the commercial marketplace. Unless you think Bruno's goal is to shrink their customer backlog while simultaneously decreasing revenue...
No, just plain no. There is no "guidance from the past" It is in the actual charter of the company that states that it exists to serve the gov't. ULA does not sell launch services on the commercial market, that is for LM Commercial Launch Services Company and Boeing Launch Services Company to do.
This is part of the nonsense I was talking about.
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#14
by
rayleighscatter
on 20 Oct, 2014 01:27
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Could they manage to go from 6 launch complexes to two (east coast and west coast) with long term planning? Could their new rocket be designed to share launch facilities with wither Atlas or Delta?
The "new" rocket is replacing one or both them. It will use the same facilities.
I suppose what I meant was if it replaced one launch vehicle could it be designed to share the same pad as the other remaining launch vehicle (if they keep two lines). Would that sort of arrangement be feasible?
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#15
by
Robotbeat
on 20 Oct, 2014 01:58
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...The "monopoly" aspect of it is no different than before. There never was competition in the US launch market, because vehicle capabilities did not overlap. Delta II did medium class, Atlas II did intermediate and Titan IV did heavy...
...this is changing, no doubt? You have SpaceX's Falcon 9 which is competitive for small through Atlas 511 (or higher, if you're doing lower energy orbits), then Falcon Heavy for everything else. There finally DOES appear to be competition (or will be sometime in 2016).
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#16
by
edkyle99
on 20 Oct, 2014 02:46
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...The "monopoly" aspect of it is no different than before. There never was competition in the US launch market, because vehicle capabilities did not overlap. Delta II did medium class, Atlas II did intermediate and Titan IV did heavy...
...this is changing, no doubt? You have SpaceX's Falcon 9 which is competitive for small through Atlas 511 (or higher, if you're doing lower energy orbits), then Falcon Heavy for everything else. There finally DOES appear to be competition (or will be sometime in 2016).
Unless ULA or SpaceX or some other company win all of the awards, it seems likely to me that one company might end up with, say, Medium payloads, one with Heavy, one with Light, and so on, reverting back to a different form of shared monopoly. (I myself never understood the reasoning for trying to design a single "EELV" launch vehicle to handle such a wide range of payloads. Lockheed Martin steered clear of that plan. Boeing stuck with the idea and suffered as a result.)
- Ed Kyle
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#17
by
Coastal Ron
on 20 Oct, 2014 02:52
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ULA does not sell launch services on the commercial market, that is for LM Commercial Launch Services Company and Boeing Launch Services Company to do.
You are missing the forest for the trees. ULA does make launchers for commercial launches, and commercial companies would like to buy more launches if the prices were lower.
But because ULA's parents decided to focus ULA's business on just one customer (i.e. the U.S. Government) they are not competitive on the commercial marketplace. But that business model assumes no competitors, and that soon will not be the case. SpaceX won't take away all of ULA's business, but over time they will likely be able to take a significant amount - the the U.S. Government wants competition, so there are few barriers to this happening over time.
And of course ULA's new CEO appears to disagree with you too when he said in the BizJournal interview:
"
The result will be a smaller ULA in the near term, but one able to grow again and win new kinds of business in the long run, said Tory Bruno, new CEO of the Centennial-based rocket maker in his first interview since being appointed Aug. 12."
Sounds like commercial to me.
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#18
by
edkyle99
on 20 Oct, 2014 02:53
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Right now they have four launch complexes, one for each rocket on each coast.
6 Technically. They also have pads for Delta II on both coasts, although SLC-17 at CCAFS has no work . I'm not sure if its still being maintained by ULA though. I also have no idea what their plans are for SLC-2W at Vandy in a few years once the last Delta II launches.
As Jim mentioned, the two East Coast Delta II pads are already being dismantled. SLC 2W at Vandenberg AFB has three more Delta II launches planned, then it too will be retired. (Though it has a nice flame trench that would look good with an Antares sitting above.)
- Ed Kyle
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#19
by
MP99
on 20 Oct, 2014 06:32
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ULA does not sell launch services on the commercial market, that is for LM Commercial Launch Services Company and Boeing Launch Services Company to do.
Who would sell Atlas Blue launches commercially?
If this is just another Atlas V, that would imply LM? I guess little demand for Delta IV on the commercial market today, so they're not losing much by not being able to offer Blue.
Cheers, Martin