Comments on: The commerical battle over U.S. surplus ICBM’s https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/ Wed, 20 Apr 2016 00:07:04 +0000 hourly 1 https://wordpress.org/?v=6.9.4 By: Edward https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/#comment-879713 Wed, 20 Apr 2016 00:07:04 +0000 http://behindtheblack.com/?p=38810#comment-879713 Jburn asked: “If the rockets are sold by competitive bid, couldn’t Virgin Galactic also place a bid to buy up the surplus and deny a competitor easy and cheap access?”

Young companies are not flush with cash (most old ones aren’t either). Whoever buys these surplus rockets needs to use them in order to get their money’s worth (and they likely will be the one to pay for storage costs during the years that it takes to use up each batch that they buy). This sets a limit on the number of potential bidders, as there are not many companies in the launch business, and even fewer that are set up to use rockets such as these — Virgin Galactic is among those that are not set up to use them. Thus, the bidding would not take the price high enough to guarantee that their use remains competitive with other startup companies.

I would hate to see these rockets go to waste, but I don’t think that the government is competent enough to find a price that ensures that Orbital would remain a competitor, as opposed to the cheapest vendor that kills an industry in its infancy. I am torn and ambivalent on this topic.

From the article: “It’s like I have a tractor-trailer, and I’m going to move your box of donuts … It’s just a completely different market.”

Consider the scenario in which the alternate mover charges twice what the trucker will charge to move the box of donuts, then the market is not so different as being advertised.

Who would you call to move your box of donuts, the inexpensive, oversize tractor-trailer or the expensive Virgin Galactic guy?

]]> By: jburn https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/#comment-879662 Tue, 19 Apr 2016 21:13:47 +0000 http://behindtheblack.com/?p=38810#comment-879662 If the rockets are sold by competitive bid, couldn’t Virgin Galactic also place a bid to buy up the surplus and deny a competitor easy and cheap access? His airline was recently sold; he now has extra time and money to play with.
Then again, rumor has it that Congress can be bought for cheap …

]]> By: Wayne https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/#comment-879608 Tue, 19 Apr 2016 17:20:55 +0000 http://behindtheblack.com/?p=38810#comment-879608 Totally out of my bailiwick (& have not pondered this greatly);
Q: What if the Pentagon auctioned them off?? Would that be more in line with helping foster a competitive market? And discovering how much this surplus is actually worth to a private concern?
Fully agree that it is unfair & ultimately uneconomical, for the Feds to pick winners & losers by employing back-door subsidies and/& restrictions that skew the playing field one way or the other.

They have already been built so it’s a sunk-cost from the Governments perspective. (Which is us, we’re still paying for them in reality.)
Cost/price, only gets things built originally– the “value” they have is more determined by their replacement cost in a more open-esque market.

]]> By: A. Feit https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/#comment-879597 Tue, 19 Apr 2016 16:50:54 +0000 http://behindtheblack.com/?p=38810#comment-879597 How many would be up for sale? Of those, how many would actually work? Of those how many could conceivably make it to space? So is there really a problem?

]]> By: DougSpace https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/#comment-879594 Tue, 19 Apr 2016 16:32:24 +0000 http://behindtheblack.com/?p=38810#comment-879594 Yeah, I was thinking the same thing as Brendan. I’m trying to think about now is how this value (spare ICBMs) could be used in such a way so as to stimulate rather than impede the development of the private launch market.

]]> By: Brendan https://behindtheblack.com/behind-the-black/points-of-information/the-commerical-battle-over-u-s-surplus-icbms/#comment-879589 Tue, 19 Apr 2016 16:13:00 +0000 http://behindtheblack.com/?p=38810#comment-879589 I usually don’t disagree with anything you say – but this might be the first. We all want commercial to succeed. It won’t help the commercial market if its killed off early with basically a government handout – which are what these rockets are. If Orbital ATK had to pay the real cost for them, would they be cost competitive? Unlikely. Instead they will pay bargain basement prices on government surplus. We all love surplus, but its not exactly fair to a young developing industry to basically make the competition free.

Other than that, as I said, love your work, and your time with John B is my favorite podcast. Even my 6 year old son loves it, and always asks a lot of questions after.

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