Los Angeles Business Journal

Scaling Heights

SpaceX weighs in with Falcon Heavy as low-cost satellite launch option By Garrett Reim Friday, December 16, 2016
Counting Down: SpaceX Falcon 9 rocket.

Counting Down: SpaceX Falcon 9 rocket. Photo by Courtesy Photo

When SpaceX’s Falcon Heavy lifts off in the second quarter of next year it will rank as the most powerful operational rocket in the world by a factor of two, though it is expected to cost millions less than its nearest American competitor.

The rocket, which would potentially cost between $180 million and $200 million when fully loaded, could shake up the heavy lift segment of the commercial launch services industry – one of the few remaining sectors not yet conquered by Hawthorne’s Space Exploration Technologies Corp., or SpaceX, led by Chief Executive Elon Musk.

Heavy lift rockets are often used to push large geosynchronous satellites into orbit. The expensive but potentially lucrative communications spacecraft transmit telephone calls and TV broadcasts.

“The Falcon Heavy would significantly alter the upper limit,” of rocket launches, said Chad Ohlandt, an engineer at Rand Corp.’s Arlington, Va., office. “It certainly puts their competition under pressure.”

The Falcon Heavy actually consists of three SpaceX Falcon 9 rocket boosters strapped together that have the capability of landing vertically back on Earth. Should SpaceX prove able to stick the landing of its rocket engines on a consistent basis, the price for the Falcon Heavy could go even lower because the company wouldn’t have to build rockets from scratch each time.

Though the long-term impact of such a vehicle is potentially enormous, said analysts, the intricacies and hiccups of the rocket science business should shield SpaceX’s closest rivals from the full blast of the Falcon Heavy over the short term. SpaceX’s American rival in the sector is the Delta IV Heavy rocket manufactured by United Launch Alliance of Centennial, Colo. The Delta Heavy rocket, which is mostly used by the U.S. military, costs about $350 million.

Despite the potential price differential, satellite operators have schedules to keep and are loath to be chained to one launch provider, said Bill Ostrave, an analyst with Forecast International Inc. in New York.

“The satellite operators like to have a choice,” he said. “They are willing to provide contracts to different launch providers in order to maintain a competitive launch industry, even if one is a little more expensive than the others.”

The Sept. 1 prelaunch explosion of a SpaceX Falcon 9 rocket, which has halted the company’s launch schedule as it investigates the incident, has also hindered the Falcon Heavy plans.

Successfully launching rockets on schedule matters for satellite operators who sink hundreds of millions of dollars and years of work into hardware in the hopes of efficiently recouping costs by bringing those broadcast systems online quickly, said Phil Smith, a senior space analyst at Tauri Group of Alexandria, Va.

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