Relativity Space: General Thread

[lightleviathan]

As I’ve been saying for a couple of years, the term “New Space” is a bit of a misnomer. If we look at actual results, there is no “New Space”. There is only SpaceX -  and a large number of would-be followers with dubious prospects. So far…

Rocket Lab?

[M.E.T.]

As I’ve been saying for a couple of years, the term “New Space” is a bit of a misnomer. If we look at actual results, there is no “New Space”. There is only SpaceX -  and a large number of would-be followers with dubious prospects. So far…

Rocket Lab?

They fall in the “dubious prospects” category.

But back to Relativity, $3B cumulative spend before first orbital launch will be some hole to fill.

[JEF_300]

So... I've lost all faith. I mean, Relativity has never managed to inspire a lot of confidence in me, but this whole thing is a couple bridges too far.

Hey, let's get 99% of the way to putting a rocket into orbit... then abandon the rocket, and the pad and other ground infrastructure, and throw all our effort behind our next-gen vehicle. And while we're at it, lets pair-back our next-gen vehicle to be the equivalent of existing vehicles, ensuring that we will, even in the absolute best possible scenario, just be 2nd to an existing market. And in the worst case scenario, we are competing with Starship, AND Falcon 9, AND New Glenn, AND Neutron, AND Firefly's MLV...

...well, good luck with that Relativity, but I don't think that's gonna work.

Nah, the change in direction is bullish for those paying attention… it shows they aren’t infected by the Sunk cost fallacy.

Smallsat launch is just not profitable even when operational. RocketLab is doing the best they can, but Electron is kind of a loss leader to enable them to sell Photon, develop Neutron, etc.

Terran-1 accomplished its goal as a pathfinder for a larger rocket. Mission accomplished.

Not falling for sunk cost fallacy is fine. I just think they could have gotten some more value out of Terran 1 relatively cheaply. It probably wouldn't have cost that much to fly Terran 1 a second time, that flight almost certainly would've made it to orbit, and then they could go to investors and say that they'd launched to orbit successfully.

But the much much much bigger issue for me, is that there is no way I can be convinced that building what is essentially just the Falcon 9 again, a decade after the original, is a business model that will work.

[Robotbeat]

So... I've lost all faith. I mean, Relativity has never managed to inspire a lot of confidence in me, but this whole thing is a couple bridges too far.

Hey, let's get 99% of the way to putting a rocket into orbit... then abandon the rocket, and the pad and other ground infrastructure, and throw all our effort behind our next-gen vehicle. And while we're at it, lets pair-back our next-gen vehicle to be the equivalent of existing vehicles, ensuring that we will, even in the absolute best possible scenario, just be 2nd to an existing market. And in the worst case scenario, we are competing with Starship, AND Falcon 9, AND New Glenn, AND Neutron, AND Firefly's MLV...

...well, good luck with that Relativity, but I don't think that's gonna work.

Nah, the change in direction is bullish for those paying attention… it shows they aren’t infected by the Sunk cost fallacy.

Smallsat launch is just not profitable even when operational. RocketLab is doing the best they can, but Electron is kind of a loss leader to enable them to sell Photon, develop Neutron, etc.

Terran-1 accomplished its goal as a pathfinder for a larger rocket. Mission accomplished.

Not falling for sunk cost fallacy is fine. I just think they could have gotten some more value out of Terran 1 relatively cheaply. It probably wouldn't have cost that much to fly Terran 1 a second time, that flight almost certainly would've made it to orbit, and then they could go to investors and say that they'd launched to orbit successfully.

But my real issue here is that there is no way I can be convinced that building what is essentially just a Falcon 9, a decade after the original, is a business model that will work.

Falcon 9 is the most in-demand rocket on the planet, maybe in history. Terran-R has about 50% more payload capacity to LEO, making it solidly heavy lift (maybe even reusably).

I think there’s a market. New Glenn and Vulcan show a real market and ULA has been able to make a living on just a few launches per year. Medium and heavy lift is a totally different ballgame. It’s actually possible to make money at it, and there’s lots of demand.

The crumbs that fall from SPaceX’s table are now larger than the entire industry once was. There’s plenty of room for Terran-R to compete.

[matthewkantar]

I think there’s a market. New Glenn and Vulcan show a real market and ULA has been able to make a living on just a few launches per year. Medium and heavy lift is a totally different ballgame. It’s actually possible to make money at it, and there’s lots of demand.

I’m not so sure New Glenn and Vulcan show a “real market.” Having the richest guy on the planet pay double because pride or spite or whatever is not a real market.

[joek]

...
I think there’s a market. New Glenn and Vulcan show a real market and ULA has been able to make a living on just a few launches per year. Medium and heavy lift is a totally different ballgame. It’s actually possible to make money at it, and there’s lots of demand.

Certainly there is a market, but demand compared to what? Whether that is a sustainable-growing market is another discussion. Reminds me of IBM crowing about their YoY growth in mainframe (390 et. al.) MIPS-revenue in the 90's. What they did not show was their ever decreasing slice of the IT revenue pie. That business is now relegated to a niche with few-none opportunities for growth.

Same fate awaits some launch providers if they are not careful. "We have defended our ground to that last square foot." Unfortunately for them, while that "last square foot" was most of the market years ago, it is a now a small (and shrinking part) of the market.

[TrevorMonty]

Most of  RL and SpaceX profits are coming from their space business not launch. In SpaceX case its Starlink and Dragon which rely on F9. F9 is definitely profitable but big money is in Starlink and Dragon.

RL is sarellite components and satellites. Electron should finally be profitable this year.

At moment both companies losses are coming from their large RLV development projects.
ULA maybe the exception in that it is profitable launched company thanks to government launch. There is but though as ULA was formed because both LM and Boeing launch businesses struggled.

Relativity doesn't have any projected revenue business except launch which is tough business to make money in. VO has already gone under and it had operational LV.
Astra is dead man walk.

[Robotbeat]

I think there’s a market. New Glenn and Vulcan show a real market and ULA has been able to make a living on just a few launches per year. Medium and heavy lift is a totally different ballgame. It’s actually possible to make money at it, and there’s lots of demand.

I’m not so sure New Glenn and Vulcan show a “real market.” Having the richest guy on the planet pay double because pride or spite or whatever is not a real market.

I just mean number of customers who are willing to book a launch vehicle that is not Falcon 9. It only takes like 5-6 launches of Terran-R’s class per year to break even in cash flow. Smallsat requires like an order of magnitude more, probably.

[JEF_300]

Not falling for sunk cost fallacy is fine. I just think they could have gotten some more value out of Terran 1 relatively cheaply. It probably wouldn't have cost that much to fly Terran 1 a second time, that flight almost certainly would've made it to orbit, and then they could go to investors and say that they'd launched to orbit successfully.

But my real issue here is that there is no way I can be convinced that building what is essentially just a Falcon 9, a decade after the original, is a business model that will work.

Falcon 9 is the most in-demand rocket on the planet, maybe in history. Terran-R has about 50% more payload capacity to LEO, making it solidly heavy lift (maybe even reusably).

I think there’s a market. New Glenn and Vulcan show a real market and ULA has been able to make a living on just a few launches per year. Medium and heavy lift is a totally different ballgame. It’s actually possible to make money at it, and there’s lots of demand.

The crumbs that fall from SPaceX’s table are now larger than the entire industry once was. There’s plenty of room for Terran-R to compete.

See, but it's not just SpaceX's crumbs. SpaceX takes the first bite, then the other SpaceX rocket takes a bite, then ULA has a go, then Blue Origin, then Rocket Lab, then Firefly/NG, and then whatever's left after all of that, Relativity can have. Because all of those companies have launched to orbit before and/or have an industry record to point to, and Relativity has neither.

Now, they may still be able to make it work anyway. After all, most of ULA and Blue's launches for the next several years have already been accounted for, so assuming Terran R can fly before their manifest opens up, they're mostly off the table for a while. And Neutron and the Firefly MLV are not as big as Terran R, and so there will be some launches that they can't do. It might work. Might. I wouldn't bet my company on it. And longer term? What happens when ULA and Blue have cleared their manifest? I just don't see it.

[joek]

I just mean number of customers who are willing to book a launch vehicle that is not Falcon 9. It only takes like 5-6 launches of Terran-R’s class per year to break even in cash flow. Smallsat requires like an order of magnitude more, probably.

Sez who? You can't make those types of statements without cites, or at least without showing your work... "It only takes like 5-6 launches..."? Your numbers must be very different than what I can find (on record).

[trimeta]

I just mean number of customers who are willing to book a launch vehicle that is not Falcon 9. It only takes like 5-6 launches of Terran-R’s class per year to break even in cash flow. Smallsat requires like an order of magnitude more, probably.

Sez who? You can't make those types of statements without cites, or at least without showing your work... "It only takes like 5-6 launches..."? Your numbers must be very different than what I can find (on record).

Especially since Rocket Lab seems poised to demonstrate that the break-even point for small launch is somewhere around 12-16 launches per year, which certainly isn't an order of magnitude more than 5-6. Now, standard caveat about "the break-even point just means you've stopped losing money, it doesn't mean you've made back any of the money you spent getting to the break-even point," but I'd be curious what numbers we have for break-even point on medium or heavy-lift vehicles.

[JEF_300]

I just mean number of customers who are willing to book a launch vehicle that is not Falcon 9. It only takes like 5-6 launches of Terran-R’s class per year to break even in cash flow. Smallsat requires like an order of magnitude more, probably.

Sez who? You can't make those types of statements without cites, or at least without showing your work... "It only takes like 5-6 launches..."? Your numbers must be very different than what I can find (on record).

Especially since Rocket Lab seems poised to demonstrate that the break-even point for small launch is somewhere around 12-16 launches per year, which certainly isn't an order of magnitude more than 5-6. Now, standard caveat about "the break-even point just means you've stopped losing money, it doesn't mean you've made back any of the money you spent getting to the break-even point," but I'd be curious what numbers we have for break-even point on medium or heavy-lift vehicles.

OATK used to say they could make OmegA profitable for 5-6 launches per year. Make of that what you will.

[Robotbeat]

Not falling for sunk cost fallacy is fine. I just think they could have gotten some more value out of Terran 1 relatively cheaply. It probably wouldn't have cost that much to fly Terran 1 a second time, that flight almost certainly would've made it to orbit, and then they could go to investors and say that they'd launched to orbit successfully.

But my real issue here is that there is no way I can be convinced that building what is essentially just a Falcon 9, a decade after the original, is a business model that will work.

Falcon 9 is the most in-demand rocket on the planet, maybe in history. Terran-R has about 50% more payload capacity to LEO, making it solidly heavy lift (maybe even reusably).

I think there’s a market. New Glenn and Vulcan show a real market and ULA has been able to make a living on just a few launches per year. Medium and heavy lift is a totally different ballgame. It’s actually possible to make money at it, and there’s lots of demand.

The crumbs that fall from SPaceX’s table are now larger than the entire industry once was. There’s plenty of room for Terran-R to compete.

See, but it's not just SpaceX's crumbs. SpaceX takes the first bite, then the other SpaceX rocket takes a bite, then ULA has a go, then Blue Origin, then Rocket Lab, then Firefly/NG, and then whatever's left after all of that, Relativity can have. Because all of those companies have launched to orbit before and/or have an industry record to point to, and Relativity has neither.

Now, they may still be able to make it work anyway. After all, most of ULA and Blue's launches for the next several years have already been accounted for, so assuming Terran R can fly before their manifest opens up, they're mostly off the table for a while. And Neutron and the Firefly MLV are not as big as Terran R, and so there will be some launches that they can't do. It might work. Might. I wouldn't bet my company on it. And longer term? What happens when ULA and Blue have cleared their manifest? I just don't see it.

I don’t think ULA’s approach is long for this world. Relativity is ahead of Neutron in engine development. Blue is too slow, even if they get first flight in 2024 or 2025.

Relativity‘s rocket is the most relevant to a post-starship world.

[Robotbeat]

I just mean number of customers who are willing to book a launch vehicle that is not Falcon 9. It only takes like 5-6 launches of Terran-R’s class per year to break even in cash flow. Smallsat requires like an order of magnitude more, probably.

Sez who? You can't make those types of statements without cites, or at least without showing your work... "It only takes like 5-6 launches..."? Your numbers must be very different than what I can find (on record).

ULA, OATK, others. That’s about what they need for cash flow breakeven.

There’s just a minimum cost to have a rocket company (look at VO’s spending, about $250M/year). That’s probably about $250 million per year in smallsat, say about $500 million for heavy lift. That translates to dozens of $10 million smallsat launches per year and half a dozen $100m heavy lift launches per year.

(Note that RocketLab cost shares Electron with Photon, which helps break even slightly earlier, but not much.)

Terran-R should be able to launch dozens of times per year, but even with the few launches they have signed up with OneWeb and some others, they may be able to do okay.

People talk about space industry as if it’s SpaceX just eating up the whole industry. But… The whole market is actually bigger, so even the non-SpaceX portion is bigger than it once was.

[TrevorMonty]

Electron break even is more like 8, would be less if they only had one pad. Thoses extra pads mean lot more overheads.

Cancelling Terran 1 doesn't remove costs of supporting its launch facilities unless they want to dismantle them and cancel lease. There is also factory infrastructure, like Terran 1 tool along with its engines and test stands. That is lot sunk costs to just walk away from and not try to make return on.

For large LVs 6 government launches a year is enough pay bills and some. Probably not enough to cover development costs.

I can't see Terran R taking any high value government missions from SpaceX and ULA.
That leaves lower cost missions which Neutron is better sized for. When comes to constellation its launch cost per satellite not how many RLV can carry. For smaller constellations a medium LV may work out cheaper if customer only wants to place 10 satellites in particular orbit. Larger LV would endup flying half full.

RL sized Neutron so it wasn't going head to head with F9R for every payload and to make it cheaper for 8-13t payloads while still competitive in constellation market.  Terran R will be going head to head with F9R and Vulcan, good luck take large share of their market.

[Nomadd]

 A lot of people don't seem to see a problem with the assumption that a company who spends six times as much as it's competition developing a rocket can magically match them in operational costs.
 The basic corporate structure and philosophy differences that make one vehicle come to light for $1/2 billion and another much smaller vehicle for $3 billion don't just go away when they go from R&D to regular service.

 And that's compared to the F9. They only spent about $90 million getting the more comparable F1 to orbit. I'm not sure how much of that budget was for the Terran 1, but you're talking about twenty to thirty times as much as the F1.

 Simplistic and not real accurate, I know, but ballpark enough to make it hard to see the competition.

[Robotbeat]

Electron break even is more like 8, would be less if they only had one pad. Thoses extra pads mean lot more overheads.

Cancelling Terran 1 doesn't remove costs of supporting its launch facilities unless they want to dismantle them and cancel lease. There is also factory infrastructure, like Terran 1 tool along with its engines and test stands. That is lot sunk costs to just walk away from and not try to make return on.

For large LVs 6 government launches a year is enough pay bills and some. Probably not enough to cover development costs.

I can't see Terran R taking any high value government missions from SpaceX and ULA.
That leaves lower cost missions which Neutron is better sized for. When comes to constellation its launch cost per satellite not how many RLV can carry. For smaller constellations a medium LV may work out cheaper if customer only wants to place 10 satellites in particular orbit. Larger LV would endup flying half full.

RL sized Neutron so it wasn't going head to head with F9R for every payload and to make it cheaper for 8-13t payloads while still competitive in constellation market.  Terran R will be going head to head with F9R and Vulcan, good luck take large share of their market.

you are just repeating the song cost fallacy with more steps. They wouldn’t make any profit by continuing the saturated small set market that was never big enough to begin with

[trimeta]

Electron break even is more like 8, would be less if they only had one pad. Thoses extra pads mean lot more overheads.

Cancelling Terran 1 doesn't remove costs of supporting its launch facilities unless they want to dismantle them and cancel lease. There is also factory infrastructure, like Terran 1 tool along with its engines and test stands. That is lot sunk costs to just walk away from and not try to make return on.

For large LVs 6 government launches a year is enough pay bills and some. Probably not enough to cover development costs.

I can't see Terran R taking any high value government missions from SpaceX and ULA.
That leaves lower cost missions which Neutron is better sized for. When comes to constellation its launch cost per satellite not how many RLV can carry. For smaller constellations a medium LV may work out cheaper if customer only wants to place 10 satellites in particular orbit. Larger LV would endup flying half full.

RL sized Neutron so it wasn't going head to head with F9R for every payload and to make it cheaper for 8-13t payloads while still competitive in constellation market.  Terran R will be going head to head with F9R and Vulcan, good luck take large share of their market.

you are just repeating the song cost fallacy with more steps. They wouldn’t make any profit by continuing the saturated small set market that was never big enough to begin with

There's maybe an argument that what Relativity would learn from a second Terran 1 launch would be worth the costs of flying it. However, the returns of additional knowledge would diminish much faster than the reduction in cost per launch, so there's definitely a fixed upper bound of how many Terran 1s it made sense to launch. And I can't argue with any confidence that this bound wasn't "one."

[Robotbeat]

A lot of people don't seem to see a problem with the assumption that a company who spends five times as much as it's competition developing a rocket can magically match them in operational costs.
 The basic corporate structure and philosophy that makes one vehicle come to light for $.5 billion and another much smaller vehicle for $3 billion doesn't just go away when they go from R&D to regular service.

 And that's compared to the F9. They only spent about $90 million getting the more comparable F1 to orbit. I'm not sure how much of that budget was for the Terran 1, but you're talking about twenty to thirty times as much as the F1.

 Simplistic and not real accurate, I know, but ballpark enough to make it hard to see the competition.

that is the rub. Can relativity make the transition from venture capital sweetheart in a zero interest rate environment to a lean rocket company in time to not run out of money before they get enough revenue to pay for their operating costs?

Nobody knows the answer to that yet but I’m pretty sure that cutting unnecessary and unprofitable programs is probably part of that.

[zubenelgenubi]

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