DOD opens ULA investigation

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The deputy inspector general of the Defense Department has notified the Air Force that he is beginning an investigation into ULA and the DOD over their relationship and contract.

He also made it clear that the investigation was sparked by last week’s comments by a ULA executive who subsequently resigned.

This is all a game. The Air Force and ULA have been colluding for years to squeeze out any competition. There is no one in Washington who needs an investigation to find this out. The inspector general will issue a report, the Air Force will admit its error and promise to do better, and they will then try to have things continue as they have.

The one difference, however, will be that SpaceX will be there, providing real competition. Thus, what matters isn’t the investigation by the inspector general. What matters is the existence of a competing company willing to put cost pressure on ULA and the Air Force.



  • mkent

    I agree that the inspector general is unlikely to find anything other than maybe nebulous cost data. I disagree, however, on your suspicion of collusion. NASA and the Air Force have both been bending over backwards to bring SpaceX into the launch services business.

    Mike Griffin is said to have personally ruled out all EELV-based solutions to the original COTS solicitation, and NASA awarded SpaceX a COTS contract two years before they successfully launched anything. According to Ashley Vance, NASA’s $1.6 billion CRS contract — awarded two years before the first successful flight of a Dragon — effectively bailed out Elon Musk, SpaceX, and Tesla. They were so strapped for cash that they were unable to make their next payroll.

    EELV program requirements state — or at least they used to — that competitors must be able to meet all EELV requirements before being allowed to bid on any launches. Yet the Air Force allows SpaceX to bid on only the launches they are able to perform, a small subset of EELV requirements. They are a long way from being able to meet all of the requirements, if they ever do.

    That’s a big reason for the difference in costs. ULA is carrying a lot of expensive infrastructure to meet those requirements that SpaceX doesn’t have to carry.

    Without preferential treatment by the Air Force, SpaceX still would be years away from certification, and without preferential treatment by NASA, SpaceX probably wouldn’t even exist.

  • You wrote: “NASA and the Air Force have both been bending over backwards to bring SpaceX into the launch services business.”

    Putting NASA aside, I disagree with you about the Air Force. If they have wanted SpaceX to provide launch services so much, why has Musk had to threaten lawsuits to get the exclusive EELV deal widened to include others beside ULA? For a long time the Air Force resisted allowing SpaceX to even bid. They dragged their feet for years with giving SpaceX launch certification, throwing up absurd roadblocks that no private company could accept. The Air Force only finally gave SpaceX certification when they were faced with those lawsuits and some real political pressure from Congress.

    The collusion was quite real, and has only begun to evaporate in the past year or so. And if SpaceX stops applying pressure at any point, that collusion will return in full force. Too many people at ULA and in the Air Force have used it to personally benefit.

  • Tom Billings

    Not only have people within the AF, the Boeing D&S, the LockMart, and the ULA hierarchies benefited, but in addition those in the Clinton Administration who set EELV on its course intend to return to power with these beneficiaries as servitors dependent on the deals first set up under the Clinton Administration. EELV was set up as it was by 2000 to serve Clinton Administration interests (for instance, LockMart was the largest industrial contributor to the 1996 Clinton campaign) and attempt to cover for early Clinton errors.

    Those errors include the January 1993 round-filing of a treaty, already within 6 months of being ready to sign, that would have set up a US/Russian GPALS system. It would have, among other good things, made it clear we saw the Russians as equals, and not beneath us, as they fear being. This abortion of that treaty pissed off the group of Kremlin military who formed up as the core of the Kremlin’s “Great Russia” faction. You may have heard of their eventual leader, named Putin. All the attempts to make up for it, from ISS deals to the RD-180 deal (yes, it’s a good engine, that had to be approved in D.C., and was, by 2000) to the infamous “reset button” have failed to keep that breach from widening.

    If another Clinton is elected, expect SpaceX contracts to go nowhere, and Vulcan to be put off for another 8 years, or be funded by the government much more massively.

  • Edward

    mkent wrote: “NASA awarded SpaceX a COTS contract two years before they successfully launched anything.”

    COTS contracts were awarded to several companies, more than one of which had never launched anything. More than one of which needed infusions of funds to remain in business.

    Kistler is a classic example. I know you have never heard of them, because the COTS contracts were not intended to keep any company in business, they were intended to find companies that could perform CRS missions. Kistler, which also never launched anything but proposed building its own launch vehicle (same as SpaceX), was a COTS company, but it was not one of the CRS companies, as it was unable to meet the milestones required to receive the COTS contractual payments. SpaceX was able to meet milestones. Kistler filed for bankruptcy, and SpaceX remained in business.

    None of the COTS contracts provided preferential treatment to any of the competitors, and none were “bailouts.” You are accusing NASA of favoritism, the very accusation that has inspired the investigation of ULA.

    You may want to familiarize yourself a little more with the COTS program. Here is a list of the competitors and proposals; please notice that few of the spacecraft existed at the time of the COTS program:

    It is important to know that some of the companies listed do not exist today. COTS was not set up to bail out any companies, it was set up to commercialize access to space and allow NASA to get back to the business of exploration and investigation rather than be a space taxi service. Just because Ashley Vance misinterpreted the events as a bailout does not make it so.

    As with all the other COTS contract recipients, while SpaceX and Kistler were working toward their milestones, they were making payroll.

    If Kistler had remained in business, would you be claiming that they were also bailed out?

    COTS was intended to develop new vehicles. It succeeded nicely, and it inspired renewed and healthy interest and investment in commercial space operations. It inspired the Commercial Crew Development program that works in a similar way as COTS, and should provide us with less expensive and more frequent manned spaceflight than we currently have.

  • Edward

    ULA was formed because the EELV program produced a rocket that was not affordable by itself. The Delta IV could carry some of the national security satellites that the DoD wanted to launch, but the DoD would buy too few each year to afford the fixed costs.

    The chosen answer was to combine the two EELV rockets into one company, which would pool the expenses, and share resources, thus the cost of the Delta IV would mostly be a per-rocket cost. No standing army needed to sit around waiting for the next launch, because they would be working on the next Atlas V launch. The idea was that overall costs to the government would be lower, and they probably are.

    Because there really weren’t any other domestic rockets capable of launching these DoD payloads, and because the two rockets were sufficiently different in capabilities that they did not compete with each other — which was the point of the EELV program — it was seen as acceptable to set up a sole source agreement with the new ULA company.

    Now, however, a new domestic rocket is becoming available, and it wants to compete with ULA on payloads that the Atlas V can launch. It is forcing ULA to change and adapt in order to better compete. This is a good thing, in a free market system.

    My question, however, is: if ULA’s Toby was right, that the government “felt that they had bent over backwards to lean the fill to our advantage,” then why is ULA being investigated instead of the government that did the bending over backwards?

    It would have been the government that did the preferential treatment of ULA, not ULA influencing the government.

  • Tom Billings

    “My question, however, is: if ULA’s Toby was right, that the government “felt that they had bent over backwards to lean the fill to our advantage,” then why is ULA being investigated instead of the government that did the bending over backwards?”

    At a guess, this is a game of “beat the client to degrade the patron”. In this case, the patron in the legislative branch is our well-known Senate Chairman Shelby, who has often acted as ULA’s protector and benefactor, since they have a large facility in Decatur, Alabama, not far from Huntsville. Shelby is unassailable, politically, in Alabama, and probably legally as well. Still, if he can be shown to not be able to protect his clients, that can be weakened. It’s been over 20 years since he was a loyal Democrat. He has caused the Administration no end of grief over NASA budgets, with
    his staffers being the origins of the infamous specifications of SLS to use Shuttle components, and with him being the one who wrote the demand for SLS being built into law.

    Enough, alone, to unseat him in 2016? No. However, if we see other actions directed at the Senator, then we might see here the beginnings of a campaign against him. The Dems need to get back the Senate to ratchet progressivism ever more upon the country. If this game is all they can do to weaken him, I think they’re desparate.

  • Dick Eagleson

    mkent, you are factually incorrect.

    SpaceX made its initial, albeit unsuccessful, launch of Falcon 1 in March 2006, five months before it won a COTS development deal. SpaceX had, indeed launched something, even if it didn’t work. SpaceX also made all of its milestones for raising outside capital and continued work on Falcon 1. It made a second launch in March 2007, which also failed, but did so much later in the ascent profile than was the case with flight 1. Meanwhile Kistler-Rocketplane
    (K-R) was struggling, and ultimately failing, to meet its outside financing milestones and had yet to launch anything.

    K-R was never successful in either raising the needed outside financing or getting a vehicle off the ground. NASA terminated K-R from the COTS program in Sept. 2007, 13 months after awarding it one of the the two funded slots, and proceeded to recompete K-R’s vacated slot, ultimately picking Orbital Sciences to take K-R’s place. SpaceX continued major upgrades to Falcon 1 and made one more unsuccessful test launch in August 2008. This mission came so close to working that SpaceX proceeded to a fourth mission just a month later.

    SpaceX’s first successful orbital mission – and the first successful orbital mission ever by a commercial entity – was the launch of a simulated payload on a Falcon 1 which occurred roughly 90 days prior to the award of the NASA CRS contract. This launch, which featured a single Merlin 1-C engine as 1st stage motive power, must be seen as NASA no doubt saw it – a convincing real-world demonstration of the engine proposed for the much larger Falcon 9 vehicle and of much of the GNC and other software required to operate the proposed hardware. It also demonstrated the force of will of SpaceX’s founder Elon Musk in persevering through initial failures to achieve success.

    Compared to SpaceX’s fellow COTS participant, K-R, these facts on the ground – and in orbit – must have served, in NASA’s mind, to remove a lot of the risk that would have been perceived, prior to this SpaceX accomplishment, in dealing with a small, quirky company run by a man with no prior professional experience in aerospace.

    K-R was the COTS entry that had, in fact, never launched anything – successfully or not – before receiving its initial COTS development grant. But K-R’s management team was well-known to NASA and headed by a former NASA Manned Spaceflight boss, George Mueller. At least initially, these folks were making all the right, NASA-soothing noises and had a deal with Aerojet, as it was then – an old-line NASA contractor – for use of the same repurposed Russian NK-33/AJ-26 engines that were later peddled to Orbital when that firm replaced K-R in COTS after the former failed to raise sufficient private investment to build their vehicle.

    SpaceX had mostly “outsider” management, but a real record of accomplishment dating from even before the initial COTS award. K-R had no accomplishments, but a very familiar management staff and a plan to operate in ways long-familiar to NASA. Both doubtless looked like good bets at the time the COTS awards were made. By the time the CRS money was in play, though, K-R had long since faded away and SpaceX had driven through the dark and into daylight.

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