I’m not sure just what you mean or if you are joking.

You may mean: A) the cost of propellant may become the major cost of a flight, as with the airline industry, or B) the cost of the propellant is a significant factor between reusable and expendable rockets.

For case A:
I agree, that is the ultimate goal, one which Peter Diamandis thought he would champion with his original X-Prize (now known as the Ansari X-Prize). The cost-performance of airlines was his example, and the Orteig Prize, won by The Spirit of St. Louis, was his inspiration.*

For case B:
Propellant costs would be similar whether the rocket is an expendable or a reusable. The reusable rocket would require additional amounts, estimated as being about 10% more. This cost is likely “in the noise” that includes the refurbishment costs, which I also ignored.

Additional ignored costs include: 1) The cost of building landing pads at the launchsites/spaceports, which would look similar to the test pads used by SpaceX’s Grasshopper test vehicle — concrete with few other fixed facilities on or near the pad. 2) The use, maintenance, and construction of SpaceX’s “barge” floating landing platform. 3) Construction and maintenance of various hardware and facilities unique to rocket refurbishment. 4) The cost to develop the reusable rocket and its procedures — which would likely be higher than an expendable rocket, as there is little experience in this area (e.g. SpaceX built special test facilities, built at least two test rockets, and hired several design and test engineers to develop and test these, not to mention the rented cows that added entertainment value to the videos).

I’m sure that a detailed analysis could itemize more costs, but the point is that re-usability overcomes economies of scale, as airlines, trucking companies, railroads, and your own car have demonstrated.

In fact, none of these industries ever considered their “vessels” to be onetime use. For them, it was inconceivable, as the cost would have been prohibitive.

It is amazing that commercial use of space is able to overcome the transportation cost of getting hardware “up the hill.” It suggests the enormous potential for additional — and more efficient — use of space as a resource and place to do business.

* Peter Diamandis is one of my heroes, because he had the “Field of Dreams” spirit of ‘If you build it, the entrants and donors would come.’ He didn’t know how to reuse a rocket within his stated two-week requirement, and he had no money to offer when he set the prize amount, but he had the audacity to set both the requirement and the prize.

You’re ignoring the cost of the propellant.

Of course, the real customers, the satellite operators don’t care about the cost to manufacture the rocket, they just care about the cost/price to fly their payload to orbit. Unless SpaceX incurs a ridiculous refurbishment cost, (and/or can’t reuse it more than once) it going to be way cheaper to fly rockets many times than it will be to build a fresh rocket everytime.

*NOTE: we don’t know how lower launch prices will change the market. It might grow things enough to keep the rocket factory busy even with reuse. Even if it does not, it can still result in lower launch costs.

Please explain http://youtu.be/kurNi0bAxdQ

I’m not sure that this analysis has considered that reusing a rocket only once (assuming no refurbishment cost) halves the cost of the rocket per launch. If it can be reused ten times, then the cost is 1/10th per launch. Reuse can very quickly overcome the “economy of scale.” Perhaps, some decade, rockets will be as reusable as commercial airliners, SpaceShipTwoes, or XCOR Lynxes.

Further, if the engines can be used as many times as the Space Shuttle’s engines, then a huge cost can be saved. Engines are pretty expensive.

If the avionics and other electronics boxes are able to be salvaged from end-of-life rockets, that can save millions of dollars more.

Since SpaceX is prepared to design more-advanced hardware, they may be able to adapt from experience and improve the re-usability, refurbish-ability, and reliability of their first stages faster than NASA was able to improve the Space Shuttle. They also seem to be more nimble and more willing than ESA and NASA to make design improvements. This may be an advantage in having the chief engineer also be the top decision maker — no need to convince a committee that something is a good idea. (The downside, of course, is that it is harder to overrule a bad idea.)

Yes, not that I know much about the rocket business specifically but generally the level of available funding, choice of design / materials and technology you decide to commit to becomes your long term business model. The trick is being able to have the vision and be correct about those choices. So far Elan Musk seems to be making the correct choices.

There is nothing worse than being married to and having to sell something that you know is not the best or as flexible as it could have been. And then sometimes, even though you have done your best in considering all of the variables you have to scrap the whole thing and start from scratch.

Its all in the starting design and philosophy.

They have already proven that they can not build cheap disposable rockets.