Space News — June 6, 2016
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Milspace Briefing
Mike Gruss


Competition’s Unclear Cadence

Think back to the start of 2014. Fresh on the heels of giving United Launch Alliance a $11 billion contract for 36 rocket cores, the U.S. Air Force promised SpaceX would be given a shot at up to 14 launches the Defense Department planned to put out for bid through 2017.

A few short months later, however, the Air Force, cut the number of up-for-grabs launches to seven.

That change of plans sufficiently irked SpaceX’s founder, Elon Musk, that he sued to stop the block buy on the grounds the Air Force ignored the presence of a credible — although not yet certfied — competitor when it sole-sourced the 28-launch award to ULA. The case eventually settled, with the Air Force agreeing to speed up certification of SpaceX’s Falcon 9 rocket and put more launches out for bid.

Now that the House and Senate have marked up their 2017 defense spending and authorization bills, let’s compare the Air Force’s progress with what it envisioned a few years ago when it decided to start seeking competing launch bids for the first time since Boeing and Lockheed Martin merged their launch businesses into ULA.

• The Air Force, after rescinding a solicitation for a National Reconnaissance Office mission, ended up awarding no competitively selected launch contracts in 2015.

• Halfway through 2016, the Air Force has awarded just one such contract: an $82.7 million deal to SpaceX to loft a GPS-3 satellite in 2018. The Air Force could conceivably award one more GPS launch contract before the current fiscal year ends Sept. 30, but it has yet to ask SpaceX and ULA for bids.

• Just last month, House and Senate appropriators marked up spending bills that only would allow the Air Force to award contracts next year for three launches instead of the five funded in the White House’s budget request. Because two of the launches the Air Force intends to order next year are thought to be part of ULA’s block buy contract, the House and Senate spending plans would only allow the Air Force to award a single competed launch contract, likely for the Space Test Program-3 mission comprising a small geostationary satellite and a half-dozen secondary payloads.

To recap: zero launches awarded in 2015, possibly as many as two in 2016 and as few as one in 2017. In other words, what was once a plan for awarding 14 launches in that stretch is looking more and more like a plan to make just three competitive awards.

So what? Well, yes, the change marks a tiny told-you-so victory for SpaceX and Musk, who said the Pentagon was moving too slowly to open up its launch business to competition, and for Sen. John McCain (R-Ariz.), who questioned whether the Air Force was serious about ending the ULA monopoly it helped create. The Air Force’s painfully slow roll out — which slows even further if Congress goes along with appropriators’ plans to slice some $400 million out of the service’s launch account — is also more proof (if any was needed) that change rarely happens fast at the Pentagon.

And while the Air Force recently gave itself an extra year to make its first batch of competitive awards, extending the so-called Phase 1A of this effort through 2018 only promises to bring two more competitive missions into the mix. In other words, the Air Force would still fall short of its seven-launch goal, never mind the 14 competitive contracts the service not-so-long-ago envisioned awarding by the end of next year.

In two short years, competitive launch contracts will become standard for the Pentagon.

Are the delays and fluctuations of the last two years the result of the Air Force and lawmakers finding their footing? Or are the fits and starts simply the new normal?
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