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NASA's Manned Rocket Contract: $4.2 Billion To Boeing, $2.6 Billion To SpaceX 188

schwit1 writes NASA has chosen two companies to ferry astronauts to and from the International Space Station, and those companies are Boeing and SpaceX. This decision confirms that SpaceX is ready to go and gives the company the opportunity to finish the job, while also giving Boeing the chance to show that it can still compete. After NASA has certified that each company has successfully built its spacecraft, SpaceX and Boeing will each fly two to six missions. The certification process will be step-by-step, similar to the methods used in the cargo contracts, and will involve five milestones. The contracts will be paid incrementally as they meet these milestones. One milestone will be a manned flight to the ISS, with one NASA astronaut on board. Boeing will receive $4.2 billion, while SpaceX will get $2.6 billion. These awards were based on what the companies proposed and requested.
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NASA's Manned Rocket Contract: $4.2 Billion To Boeing, $2.6 Billion To SpaceX

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  • Six Missoins Each (Score:5, Informative)

    by Bo'Bob'O ( 95398 ) on Tuesday September 16, 2014 @05:06PM (#47921991)

    It was clarified later that both companies would fly six missions each (not counting the test mission).

    I don't know if the director misspoke or was misunderstood, but she said later in the conference call they have the same requirements for the number of missions.

    • by Guspaz ( 556486 ) on Tuesday September 16, 2014 @05:29PM (#47922151)

      They both got essentially the same contract, the dollar value represents what the companies bid for it, rather than establishing a first/second place.

      Basically, the both won an equal contract. On the one hand, it sucks for SpaceX that they get less money to do the same thing, but on the other hand, it will put quite a feather in their cap to be able to demonstrate concretely that they can live up to their claims of doing it for less, which will give them a huge edge in the next round of contracts. Next time they can say "Look, we did everything just as well as Boeing, but we cost you a ton less. This time you should give us most of the flights."

      • Re:Six Missoins Each (Score:4, Interesting)

        by budgenator ( 254554 ) on Tuesday September 16, 2014 @06:07PM (#47922409) Journal

        On the one hand, it sucks for SpaceX that they get less money to do the same thing

        It wouldn't suck if they made more profit on less revenue.

        • by ron_ivi ( 607351 )

          It wouldn't suck if they made more profit on less revenue.

          Sure it could.

          For example, Boeing could take the $4B and spend $5B on R&D having negative profit; while SpaceX could take the $2B and make $1B profit.

          But then Boeing's technology will have improved by $5B in R while SpaceX's will have only benefited 1/5th as much

          • by GNious ( 953874 )

            It wouldn't suck if they made more profit on less revenue.

            Sure it could.

            For example, Boeing could take the $4B and spend $5B on R&D having negative profit; while SpaceX could take the $2B and make $1B profit.

            But then Boeing's technology will have improved by $5B in R while SpaceX's will have only benefited 1/5th as much

            Boeing could take the $4B and spend $5B on R&D, then be awarded another $2B to cover unforeseen expenses ... (FTFY)

          • by rioki ( 1328185 )

            You are missing the point that the amount of money invested into R&D actually means something. As it stands I have the impression that each dollar spent by SpaceX in R&D has about the 10x impact then Boeing's R&D. SpaceX is extremely lean and have quite something to show for it. The problem with Boeing's R&D is that most of it is classified in some military contracts and as such hard to evaluate from the outside.

          • If Boeing gets the same "Bang for the Buck" that SpaceX gets that's a very valid point, but my suspicion is SpaceX is going to get more bang for the buck than Boeing can. SpaceX has one mission, but Boeing has it's finger's into a lot of pies and that has to color their respective corporate cultures.

      • Quite likely spaceX didn't know how much money was on the table. They worked up a proposal to get the DragonRider completely flight ready and said "This is how much we think we'll need plus some padding." I'm sure if you went digging for the RFP you'd see that these milestones were set out by NASA with the percentages attached to each milestone.

        SpaceX has been building, flying and recovering Dragon modules for a couple of years now. Boeing has not. That extra couple of billion dollars that Boeing got wa
  • My Guess (Score:5, Insightful)

    by TrippTDF ( 513419 ) <hiland.gmail@com> on Tuesday September 16, 2014 @05:09PM (#47922011)
    SpaceX will make $2.6 Billion do way cooler stuff than $4.2 Billion to Boeing. SpaceX is a young, hungry company that is on the forefront of multiple industries. Boeing, while still a great company, is older an no doubt bogged down in more levels of bureaucracy.
    • Re: (Score:3, Informative)

      by tlhIngan ( 30335 )

      SpaceX will make $2.6 Billion do way cooler stuff than $4.2 Billion to Boeing. SpaceX is a young, hungry company that is on the forefront of multiple industries. Boeing, while still a great company, is older an no doubt bogged down in more levels of bureaucracy.

      Perhaps. I suppose one reason is that SpaceX will be doing a very cutting edge design with little baggage to hold it back. Boeing will do a much more conservative design.

      Then the two will be compared to each other to see how well they compare and to

      • Re:My Guess (Score:4, Insightful)

        by timeOday ( 582209 ) on Tuesday September 16, 2014 @06:39PM (#47922615)
        Actively funding both gives you a VERY easy way to reward and punish - simply move the needle a little either way in the next round of funding. Once you've committed to one or the other, the incumbent gets entrenched and very cozy.
      • It's not as cut and dry as one is more expensive than the other either. Let's not forget that Boeing has not participated in the COTS funding to nearly the degree that SpaceX has.

        It's true that CTS-100 hasn't flown yet. But the only reason Dragon has flown has been because NASA funded the COTS missions. SpaceX received $396M from that program alone. The ISS CRS missions have awarded SpaceX another $1.6B in contracts. So it makes sense that there will be a lot of overlap in that $2B. After all the ca

    • Re:My Guess (Score:5, Interesting)

      by DerekLyons ( 302214 ) <fairwater AT gmail DOT com> on Tuesday September 16, 2014 @06:31PM (#47922563) Homepage

      SpaceX will make $2.6 Billion do way cooler stuff than $4.2 Billion to Boeing. SpaceX is a young, hungry company that is on the forefront of multiple industries. Boeing, while still a great company, is older an no doubt bogged down in more levels of bureaucracy.

      There's another factor that everyone is ignoring - SpaceX is proposing a craft that's a modification of an existing vehicle and which is also expected to be subsidized by commercial use. Boeing on the other hand is proposing a craft that's clean-sheet new and has no other customers.

      • by rioki ( 1328185 )

        Boeing on the other hand is proposing a craft that's clean-sheet new and has no other customers.

        That is better because?

        • I didn't say it was better - or worse. I merely pointed out that the two bids were not identical, and thus comparisons drawn on the basis (assumption) that they were identical were deeply flawed.

        • Boeing on the other hand is proposing a craft that's clean-sheet new and has no other customers.

          That is better because?

          He didn't say anything about one being better than the other (#fileitundereadingcomprehension.)

          With that said, from a fault-tolerant point of view, this makes absolute sense. It would be extremely hard and un-probable that any major flaws in one system will be present in the other system. This has been a typical way to create redundant, fault-tolerant solutions, expensive, but totally appropriate when critical systems are concerned.

          Re-using an existing design has the advantage of leveraging known factor

  • by Anonymous Coward on Tuesday September 16, 2014 @05:10PM (#47922021)

    Boeing - Giant Company - $4.2B for a space vehicle that is still in design.
    SpaceX - Space Startup - $2.6B for a space vehicle that works and has been flying missions for two years.

    Spend your money more wisely.

    • by jythie ( 914043 )
      Boeing also has a much longer track record of success. SpaceX has promise, but Boeing has shown it can deliver.
      • by Penguinisto ( 415985 ) on Tuesday September 16, 2014 @05:59PM (#47922341) Journal

        SpaceX has promise, but Boeing has shown it can deliver.

        ...eventually, and only after the requisite pork has been spread across a multitude of states and subcontractors to keep the requisite congress-critters happy. :(

        Not to knock Boeing's technical prowess, but damn - they do know how to play the game (which explains why they're getting a piece of the contract most likely...)

        As a very apt comparison, go back to the days when the F-16 first came out: relatively cheap, by some upstart company (General Dynamics), a revolutionary design, the first 9-G capable fighter, and was an all-around workhorse that could do (within reason) damned near anything you demanded of it. It's still in production today (albeit as a division of Lockheed-Martin), with a design that stands to be around for decades to come. Compare and contrast this with, oh, the F-35/6/whatever that's been nothing but a massive money-sink to date.

        • by mirix ( 1649853 )

          General dynamics was around since 1900, and obtained Convair and Canadair in the 50's, so I don't think "some upstart" is really apt.

          (it was called "electric boat" before then, as it mostly made subs (which they still make))

        • SpaceX has promise, but Boeing has shown it can deliver.

          ...eventually, and only after the requisite pork has been spread across a multitude of states and subcontractors to keep the requisite congress-critters happy. :(

          Not to knock Boeing's technical prowess, but damn - they do know how to play the game (which explains why they're getting a piece of the contract most likely...)

          As a very apt comparison, go back to the days when the F-16 first came out: relatively cheap, by some upstart company (General Dynamics), a revolutionary design, the first 9-G capable fighter, and was an all-around workhorse that could do (within reason) damned near anything you demanded of it. It's still in production today (albeit as a division of Lockheed-Martin), with a design that stands to be around for decades to come. Compare and contrast this with, oh, the F-35/6/whatever that's been nothing but a massive money-sink to date.

          Did you just called GD an "upstart" (relative to the time the F-16 was built)? #youarenuts

          GD is a century old tech mega-ass conglomerate (think GE of defense) that builds from armored vehicles to fighters to satellites to naval warships to communication systems to artillery, you name it, with branches all over the world.

          If GD was an upstart at the time the F16 was being build, I'm batman!

    • Boeing - Giant company able to funnel money to appropriate Senators and congressmen
      SpaceX - Small company able to funnel less money than Boeing to anyone.

      Stop voting for Republicrats and Demicans.

    • Boeing is the ISS's primary contractor.. they designed and built a lot of it. I don't see how it is unreasonable to grant them as much as they did in relation to SpaceX - even though I personally much rather see SpaceX make something amazing for less as I expect they will.

    • Spend your money more wisely.

      Get your facts more straight. Dragon V2 is in fact derived from the Dragon CRS, but it's not the same vehicle and emphatically has not been flying for two years.

    • Boeing - Giant Company - $4.2B for a space vehicle that is still in design. SpaceX - Space Startup - $2.6B for a space vehicle that works and has been flying missions for two years.

      Spend your money more wisely.

      We are talking about NASA and space exploration, not implementing and deploying ER software systems. Re-using existing designs is a very acceptable approach, but for the type of R&D and work that this involves, NASA (and we) need to also explore new designs. The time to do is now.

      I think *our* money is well spent by funding both proposals and to put them into competition. The point is not just to have someone deliver something, but to do R&D and extend our body of engineering knowledge. Our money

  • by bruce_the_loon ( 856617 ) on Tuesday September 16, 2014 @05:11PM (#47922029) Homepage

    Not Boeing alone, and not SpaceX alone. This is the best possible outcome for NASA, not reliant on a single supplier like before.

    The fact that to deliver the same development and certification process costs $1.6 billion less for SpaceX over Boeing is also interesting. Some are already saying that it is a bigger win for Boeing and that SpaceX is a backup plan, but since the amounts are what the two companies bid on the project, it shows how economical SpaceX believes they can be.

    And that there are two companies still competing should reduce the risk of deliberate cost-overruns and delays. If one can get to full certification a year or more ahead of the other, it will be a huge blow to the second-place finisher's chances to win the final operational contract.

    • The fact that to deliver the same development and certification process costs $1.6 billion less for SpaceX over Boeing is also interesting.

      We won't really know this is true until it happens. I have high hopes for SpaceX - specifically I hope they can do much more with less. Either way though, this is a big win for everyone!

    • If some new startup had some better/cheaper/faster alternative to Oracle we'd probably try them out where I work, but I bet they'd get 1/10th the money we're willing to pay Oracle. Trust is a valuable thing. (and yea, I know Oracle sucks, but they aren't going out of business anytime soon)

      Don't assume SpaceX is getting less money because their better. SpaceX is getting less money because they know if they charged the same as Boeing there's no way in hell they would have gotten the contract.

    • by DerekLyons ( 302214 ) <fairwater AT gmail DOT com> on Tuesday September 16, 2014 @06:22PM (#47922499) Homepage

      The fact that to deliver the same development and certification process costs $1.6 billion less for SpaceX over Boeing is also interesting.

      It's not the same development and certification process - as SpaceX will be flying a modification of an existing (certified) spacecraft, while Boeing's is a new and unflown design.

    • The best possible outcome IMO would have been SpaceX and Sierra Nevada (who doesn't get mentioned in the summary). I think Boeing's design is almost entirely inferior to both - more expensive, less capable, less developed, less tested. Also has been experiencing some serious problems in wind tunnel testing. However, as someone else pointed out, they've been around much longer, and know how to play the game.
    • by jfengel ( 409917 )

      I didn't follow the speculation, but perhaps you'd know: did they realize that splitting was an option? Did Boeing and SpaceX each get half a loaf, or did NASA somehow manage to "grow the pie"?

      If so, where will they dig up additional billions in funding? If not, will either SpaceX or Boeing be able to accomplish a large fraction of the work for a fraction of the funding they'd hoped to get?

      I'm ecstatic to see them say "Why not both?", since if the government is going to be spending tax dollars, I'd rather s

  • by werepants ( 1912634 ) on Tuesday September 16, 2014 @05:11PM (#47922031)
    This is a reasonable move, I'm not sure that Boeing deserves more cash than SpaceX though. I'm also bummed for Sierra Nevada, the Dreamchaser is awesome. To be fair, there have been rumors of troubles with their hybrid engine recently. Hopefully the ESA will pick them up for some flights.
    • It's not a matter of whether Boeing deserves the extra cash or not. Deserve has nothing to do with it.

      Boeing simply cannot (and will not) do it for less than the $4.2 billion, otherwise they'd be losing money. But SpaceX can do the same job for less, at $2.6 billion. So you could say SpaceX is much more efficient than Boeing.

      So why didn't NASA just give the whole thing to SpaceX and save money? Redundancy, hedging your bets, not putting all your eggs in one basket, etc.

      • If you insist, substitute "has a system that merits" for "deserves". Also, if money or capability was what mattered, SNC would've gotten an award instead of Boeing, because they've got a more developed vehicle while receiving significantly less cash. There are also some huge technical problems with the CST100 - it has apparently been having big issues with wind tunnel testing.

        I don't think the right choice was made here, but I'm not privy to all the information used to make the decision. I hope SNC stays
    • The Dreamchaser can still be awarded a contract. NASA described several "On Ramps" where if they finish their paperwork and do a little but of 'make-up' work they can still pass. ;)

      It makes sense. Dreamchaser just wasn't ready for this round. But it's good that NASA has a contingency for projects that are farther behind but still long term viably good competition.

      • I hope they can get some NASA work in the future. SNC has gotten a vehicle farther developed than Boeing while receiving significantly less funding, and the vehicle has unique capabilities to boot. I wonder if the recent change to a liquid engine did them in.
  • Wow, I am impressed (Score:4, Interesting)

    by Ecuador ( 740021 ) on Tuesday September 16, 2014 @05:28PM (#47922143) Homepage
    I did not think SpaceX even with its excellent track record would have convinced the bureaucrats to give them a solid chance instead of just give everything to Boeing as usual. And actually $2.6b is to SpaceX probably more than what $4.2b is to Boeing. And it might actually force Boeing to actually develop their solution efficiently for once, since I doubt they can count on huge cost overruns if the competing contract is on time & on budget.
    • I did not think SpaceX even with its excellent track record would have convinced the bureaucrats to give them a solid chance instead of just give everything to Boeing as usual.

      SpaceX's excellent track record? Ship me some of what you're smoking, as it must be good stuff. (Seriously, where do you guys get this stuff?)

      SpaceX's track record is far from excellent. The first flight of the Falcon 9 was six months late, the first flight of the Falcon/Dragon COTS was two years late. (And that's pretty m

      • What was that expression?? oh yeah, "It isn't rocket science" which is used to convey that everything is relatively easy compared to rocket science.

        It's not an iPhone... even the iPhone is an example of the pinnacle of human manufacturing (note the use of "an" not "the.) A mass produced wireless super computer that fits in a pocket and understands the spoken word better than a congressman.

  • by James P Lynch ( 2930801 ) on Tuesday September 16, 2014 @06:18PM (#47922463)

    After watching the Commercial Crew presser this afternoon, I was surprised at how lame the NASA people came off.

    NASA director Charlie Bolden simply read verbatim from an email he sent earlier to NASA employees. He spent most of his time aggrandizing the Orion space capsule (Apollo-derived) and its launch vehicle SLS (space shuttle-derived) without devoting much time at all to the commercial crew effort.

    Commercial Crew manager Kathy Leuders came off like an old Bob-and-Ray skit where she was armed with only three bits of information and that was all you're going to get out of her. Somebody asked her about the Boeing reliance on Russian rocket engines and her answer was not exactly convincing.

    There was an astronaut there who waxed poetic about seeing the Milky Way from the space station. One other NASA guy had nothing significant to add.

    Bottom line? Each company (Boeing and SpaceX) bid what they thought the job was worth; NASA awarded them what they asked for. Boeing got nearly twice the funding for a conservative, unimaginative Apollo capsule with a Russian-based launch vehicle. Most of the newsmen asking questions were suspicious about this, as am I.

    • Boeing got nearly twice the funding for a conservative, unimaginative Apollo capsule

      What's wrong with a "conservative unimaginative" design? This wasn't intended to be a beauty contest or to provide geek stroke material, it's a contract for workaday vehicles and services. And as for costs, you've got to remember the difference between the vehicles - SpaceX bid a derivative of an existing craft (I.E. with a lot of the development already paid for), while Boeing bid a new design. Comparing straight up doll

  • SpaceX Minecraft (Score:5, Insightful)

    by ihaveamo ( 989662 ) on Tuesday September 16, 2014 @06:26PM (#47922529)

    Wow - Java Computer game licensing ... 2.5 billion, the future of America's space dreams ... 2.6 billion.

  • Welp, they sure split that baby.

    (No seriously. Remember, the point of Solomon's judgement was to use a decision that's bad for both sides to determine who the real winner should be in the end. Same here. I'm betting we'll see Boeing whine, delay, and run over budget while SpaceX gets down and builds some rockets, but either way, in a few years we'll see who the manned spacecraft baby really belongs to.)

  • I'm confused, What does this mean for SLS. Does this mean SLS goes away (if only we could be so lucky).

  • This is how KSP contracts should work, and not some silly "test the parachute while landed on the Mun"!
  • You can't unwind the tentacles of the military-industrial complex all at once. You also can't ignore SpaceX and how well they have been doing.

    This award is simply acknowledging reality. Boeing has to get some pork to keep the lobbyists happy, SpaceX has to get some money to keep them in the running. It will be a slow shift over time as SpaceX continues to deliver for less money.

    SpaceX is playing the game... why do you think they are opening a spaceport in Texas? Gotta spread those jobs around to keep Congre

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