Space Force ends development contracts with Blue Origin and Northrop Grumman
The Space Force, having chosen SpaceX and ULA as its sole launch providers, officially ended on December 31, 2020, its rocket development contracts with Blue Origin and Northrop Grumman.
The Air Force awarded Launch Service Agreements to Blue Origin, Northrop Grumman and United Launch Alliance. These were six-year public-private partnerships where both the government and the contractors agreed to invest in rocket development and infrastructure required to compete in the National Security Space Launch program.
The plan from day one was to discontinue the LSAs with companies that did not win a National Security Space Launch procurement contract. Blue Origin and Northrop Grumman lost to ULA and SpaceX, which were selected in August 2020. The Space and Missile Systems Center confirmed in a statement to SpaceNews that the LSAs with Blue Origin and Northrop Grumman ended in Dec. 31, 2020.
From October 2018 through December 2020, Blue Origin was paid $255.5 million. The original six-year agreement was worth $500 million. Northrop Grumman got $531.7 million over that same period, nearly two-thirds of the total value of the LSA which was $792 million.
This whole deal stinks to high heaven. First, it never made any sense for the military to restrict bidding on future launches to just two companies. Such a restrictions smells of a cartel deal designed to play favorites, something the government should not do. It also ends up costing the government more, as it limits competition.
Second, the money handed out sure looks like nice pay-offs to all these big companies, designed to pay company salaries rather than real design work. SpaceX chose not to take it, because it did not want to be beholden to the military’s bureaucracy in how it developed Starship/Super Heavy. That choice has proven wise, as the deal slowed development of both Blue Origin’s New Glenn and ULA’s Vulcan rockets by at least a year, while SpaceX Starship development has moved forward far quicker.
Moreover, its seems very inappropriate for ULA to still be getting this government cash while SpaceX does not. In truth, neither should get a dime unless they actually sign a contract to launch something for the Space Force. Otherwise it is just a form of kickback and a misuse of the taxpayer’s money.
Not that my complaining here will change anything. The big aerospace industry has been addicted to these kind of government payoffs for decades, and apparently will continue to be so addicted for the foreseeable future.
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
The Space Force, having chosen SpaceX and ULA as its sole launch providers, officially ended on December 31, 2020, its rocket development contracts with Blue Origin and Northrop Grumman.
The Air Force awarded Launch Service Agreements to Blue Origin, Northrop Grumman and United Launch Alliance. These were six-year public-private partnerships where both the government and the contractors agreed to invest in rocket development and infrastructure required to compete in the National Security Space Launch program.
The plan from day one was to discontinue the LSAs with companies that did not win a National Security Space Launch procurement contract. Blue Origin and Northrop Grumman lost to ULA and SpaceX, which were selected in August 2020. The Space and Missile Systems Center confirmed in a statement to SpaceNews that the LSAs with Blue Origin and Northrop Grumman ended in Dec. 31, 2020.
From October 2018 through December 2020, Blue Origin was paid $255.5 million. The original six-year agreement was worth $500 million. Northrop Grumman got $531.7 million over that same period, nearly two-thirds of the total value of the LSA which was $792 million.
This whole deal stinks to high heaven. First, it never made any sense for the military to restrict bidding on future launches to just two companies. Such a restrictions smells of a cartel deal designed to play favorites, something the government should not do. It also ends up costing the government more, as it limits competition.
Second, the money handed out sure looks like nice pay-offs to all these big companies, designed to pay company salaries rather than real design work. SpaceX chose not to take it, because it did not want to be beholden to the military’s bureaucracy in how it developed Starship/Super Heavy. That choice has proven wise, as the deal slowed development of both Blue Origin’s New Glenn and ULA’s Vulcan rockets by at least a year, while SpaceX Starship development has moved forward far quicker.
Moreover, its seems very inappropriate for ULA to still be getting this government cash while SpaceX does not. In truth, neither should get a dime unless they actually sign a contract to launch something for the Space Force. Otherwise it is just a form of kickback and a misuse of the taxpayer’s money.
Not that my complaining here will change anything. The big aerospace industry has been addicted to these kind of government payoffs for decades, and apparently will continue to be so addicted for the foreseeable future.
On Christmas Eve 1968 three Americans became the first humans to visit another world. What they did to celebrate was unexpected and profound, and will be remembered throughout all human history. Genesis: the Story of Apollo 8, Robert Zimmerman's classic history of humanity's first journey to another world, tells that story, and it is now available as both an ebook and an audiobook, both with a foreword by Valerie Anders and a new introduction by Robert Zimmerman.
The ebook is available everywhere for $5.99 (before discount) at amazon, or direct from my ebook publisher, ebookit. If you buy it from ebookit you don't support the big tech companies and the author gets a bigger cut much sooner.
The audiobook is also available at all these vendors, and is also free with a 30-day trial membership to Audible.
"Not simply about one mission, [Genesis] is also the history of America's quest for the moon... Zimmerman has done a masterful job of tying disparate events together into a solid account of one of America's greatest human triumphs."--San Antonio Express-News
First, it never made any sense for the military to restrict bidding on future launches to just two companies.
The military *didn’t* restrict bidding on future launches to just two companies. Any American company is free to bid on future launch contracts. It held a competition on *this* launch contract, and ULA and SpaceX won.
SpaceX chose not to take it, because it did not want to be beholden to the military’s bureaucracy in how it developed Starship/Super Heavy.
SpaceX didn’t choose not to take it. They bid on and lost the competition. Then they sued the government to force them to give SpaceX the contract, and they lost that too.
Moreover, its seems very inappropriate for ULA to still be getting this government cash while SpaceX does not.
Why? You don’t complain when SpaceX gets money that ULA does not. For example, SpaceX is charging the government to develop vertical integration and a large fairing, two things that Boeing (a forerunner of ULA) paid for out of its own pocket on the Delta IV program.
In truth, neither should get a dime unless they actually sign a contract to launch something for the Space Force.
Both SpaceX and ULA *have* signed contracts to launch payloads for the Space Force. That’s what this is all about.
mkent,
You wrote: “Both SpaceX and ULA *have* signed contracts to launch payloads for the Space Force.”
I think that you missed something. The Launch Service Agreements are independent of payload launch contracts and are related to development of new launch vehicles. As I understand Robert’s position, these four companies should have developed their own vehicles independent of military funding. In addition, Robert complained that accepting this funding resulted in delays to the development of these rockets.
“You don’t complain when SpaceX gets money that ULA does not.”
You missed one of Robert’s other sentences: “In truth, neither should get a dime unless they actually sign a contract to launch something for the Space Force.” This is a complaint that SpaceX should not receive money for anything other than services rendered.