In 2014, the National Aeronautics and Space Administration (NASA) awarded contracts to Boeing and SpaceX to ferry astronauts to the International Space Station (ISS) under the Commercial Crew Program (CCP). The inclusion of Boeing, a longstanding aerospace firm with decades of know-how, was expected, but the addition of SpaceX was an indication that NASA was ready to increase competition and use new technology.
Nearly 10 years after the contract was awarded, only one of the contractors can offer viable transportation to the ISS, and it is not the established aerospace veteran.
The latest setback for Boeing occurred on June 1, 2023, when the company and NASA revealed that the Starliner capsule’s first flight with astronauts would be delayed yet again with the discovery that its parachute system and tape inside the capsule were flammable. This news follows years of delays and false starts for Boeing. Starliner was unable to dock on its maiden launch on Dec. 20, 2019, and on Feb. 6, 2020, a NASA safety review panel found that Boeing averted a “catastrophic failure” that was unrelated to its failure to dock. A second attempt on Aug. 4, 2021 was scrubbed after 13 propulsion valves failed to open during preflight testing.
In the meantime, SpaceX has proven reliable, successfully completing five CCP missions using its Crew Dragon. A sixth SpaceX capsule is currently docked, set to ferry astronauts back to earth, and SpaceX will undertake a further two CCP missions over the next eight months. The initial CCP contract awarded Boeing and SpaceX six missions each. Given the delays of the Starliner program, SpaceX is set to complete all its missions prior to Boeing delivering any astronauts to the ISS.
SpaceX is also winning on cost. A Nov. 14, 2019, NASA Office of Inspector General (OIG) report found that NASA will pay Boeing $90 million per astronaut for a ride to the ISS, 64 percent more than the $55 million being paid to SpaceX. This reflects the disparity in the total value of the CCP contracts awarded to the companies. The OIG estimated Boeing’s contract to be worth $4.3 billion, while SpaceX will be paid $2.5 billion for the same service.
The stark contrast in reliability and cost has vindicated the federal government’s decision to inject competition and the use of new technology for its cross-agency launch needs. The private sector has risen to the challenge and new firms have begun to win contracts for National Security Space Launches (NSSL) and NASA’s missions of exploration.
Indeed, new companies producing innovative technologies like the reusability of launch components have been a game-changer. These firms have conducted extensive research, development, and testing over a relatively short period of time and successfully challenged and won contracts with or instead of long-time incumbents whose technology is not moving ahead as quickly. The coming decade will see additional entrants in the market, increasing access to space for both the federal government and the private sector while driving down costs.
Government contracting should reflect this new reality. Barriers to entry in the past too often blocked access to new participants, advantaging legacy contractors. SpaceX was forced to sue the Air Force in April 2014 to open access to the NSSL competition.
Thankfully, officials are already adopting forward-thinking policies. The Space Force released guidelines on Feb. 16, 2023 for NSSL Phase 3 that will incentivize the participation of new rocket firms for a series of launches between fiscal years 2024 and 2029. “Lane 1” of NSSL Phase 3 is meant to be more risk tolerant, enabling firms with burgeoning technology to participate, while “Lane 2” is reserved for the more challenging launches.
Private firms operating under contract with the federal government have formed the new backbone of space commercialization and exploration. The technologies developed in the past decade mean that the next decade will provide more cost-effective access to space and far greater potential for exploration. The federal government should continue to position itself to take advantage of private sector innovation. These developments were presaged in the 1984 Grace Commission report under President Reagan, which recommended that the government increase its investment into the privatization of space travel.
The smashing success and inclusion of new firms in all areas of aerospace contracting represents a rare procurement triumph. The new model has proven its worth, and should be relied upon not just at NASA, but across all agencies when pursuing ventures in space.
Sean Kennedy is director of policy and research at Citizens Against Government Waste.