Elon Musk Statement on Winning Commercial Crew and a Look Behind the Numbers

Image Credit: SpaceX

Based on questions asked at the NASA press conference announcing Boeing and SpaceX as winners of the Commercial Crew competition today, as well as those posed during an audio conference with the media which followed it, there is widespread confusion concerning the dollar differential between the two awards

First though, a statement from SpaceX founder, CEO and Chief Technology Officer Elon Musk

“SpaceX is deeply honored by the trust NASA has placed in us. We welcome today’s decision and the mission it advances with gratitude and seriousness of purpose. It is a vital step in a journey that will ultimately take us to the stars and make humanity a multi-planet species.”

And now to just what that will cost.

The two awards are for a total possible amount of $4.2 and $2.6 billion to Boeing and SpaceX respectively. The key metric however, is the fact that the award amounts are variable, covering between two and six operational, what NASA inelegantly terms “post certification” flights of either the Boeing CST-100 and SpaceX Dragon, as well as one test flight each, along with product development and a small amount for supplementary testing.

Both companies are expected to perform a minimum of three total flights, one test, and two operational,  while one or the other could be awarded up to seven total flights, one test and a six operational through the initial contract period which should extend to 2020.

If Boeing performs seven flights, the total award will be $4.2 billion, where if SpaceX performs seven, its total will be $2.6 billion. SpaceX has stated on multiple occasions that its per flight price under Commercial Crew would be approximately $140 million, a small increase over the current $133 million it charges NASA under the separate CRS station resupply contract.  Seven flights would total just under $1 billion, suggesting the approximate cost of the development phase is $1.6 billion.

Boeing has not been nearly as forthcoming with its pricing where NASA is concerned, but a prior per seat flight rate to a future Bigelow station was set $36.75 million per seat, suggesting an imputed figure of $257 million per flight of the CST-100 aboard the Atlas V.  Plugging that back into the numbers announced today, seven Boeing flights conducted under Commercial Crew would cost approximately $1.8 billion, leaving $2.4 billion remaining under the development portion.

Rough numbers to be sure, and subject to change, but they highlight why despite a spate of wildly inaccurate reports which began last night with a story in the Wall Street Journal and were repeated endlessly in copy and paste new stories today, Boeing was not any more of a winner than SpaceX. In fact, with total program budgets notional and subject to the whims of Congress, it may very well turn out to be the case that SpaceX conducts seven flights in the current phase whereas Boeing conducts only three.

Only time will tell. But any way you look at it, the true winners today were the American taxpayers.

The official NASA announcement follows:

U.S. astronauts once again will travel to and from the International Space Station from the United States on American spacecraft under groundbreaking contracts NASA announced Tuesday. The agency unveiled its selection of Boeing and SpaceX to transport U.S. crews to and from the space station using their CST-100 and Crew Dragon spacecraft, respectively, with a goal of ending the nation’s sole reliance on Russia in 2017.
“From day one, the Obama Administration made clear that the greatest nation on Earth should not be dependent on other nations to get into space,” NASA Administrator Charlie Bolden said at the agency’s Kennedy Space Center in Florida. “Thanks to the leadership of President Obama, the hard work of our NASA and industry teams, and support from Congress, today we are one step closer to launching our astronauts from U.S. soil on American spacecraft and ending the nation’s sole reliance on Russia by 2017. Turning over low-Earth orbit transportation to private industry will also allow NASA to focus on an even more ambitious mission – sending humans to Mars.”

These Commercial Crew Transportation Capability (CCtCap) contracts are designed to complete the NASA certification for human space transportation systems capable of carrying people into orbit. Once certification is complete, NASA plans to use these systems to ferry astronauts to the International Space Station and return them safely to Earth.

The companies selected to provide this transportation capability and the maximum potential value of their FAR-based firm fixed-price contracts are:
— The Boeing Company, Houston, $4.2 billion
— Space Exploration Technologies Corp., Hawthorne, California, $2.6 billion

The contracts include at least one crewed flight test per company with at least one NASA astronaut aboard to verify the fully integrated rocket and spacecraft system can launch, maneuver in orbit, and dock to the space station, as well as validate all its systems perform as expected. Once each company’s test program has been completed successfully and its system achieves NASA certification, each contractor will conduct at least two, and as many as six, crewed missions to the space station. These spacecraft also will serve as a lifeboat for astronauts aboard the station.

NASA’s Commercial Crew Program will implement this capability as a public-private partnership with the American aerospace companies. NASA’s expert team of engineers and spaceflight specialists is facilitating and certifying the development work of industry partners to ensure new spacecraft are safe and reliable.

The U.S. missions to the International Space Station following certification will allow the station’s current crew of six to grow, enabling the crew to conduct more research aboard the unique microgravity laboratory.

“We are excited to see our industry partners close in on operational flights to the International Space Station, an extraordinary feat industry and the NASA family began just four years ago,” said Kathy Lueders, manager of NASA’s Commercial Crew Program. “This space agency has long been a technology innovator, and now we also can say we are an American business innovator, spurring job creation and opening up new markets to the private sector. The agency and our partners have many important steps to finish, but we have shown we can do the tough work required and excel in ways few would dare to hope.”

The companies will own and operate the crew transportation systems and be able to sell human space transportation services to other customers in addition to NASA, thereby reducing the costs for all customers.

By encouraging private companies to handle launches to low-Earth orbit — a region NASA’s been visiting since 1962 — the nation’s space agency can focus on getting the most research and experience out of America’s investment in the International Space Station. NASA also can focus on building spacecraft and rockets for deep space missions, including flights to Mars.