Main Engine Cut Off - T+54: Eric Berger

Episode Date: July 27, 2017

Eric Berger returns to the show to talk about Elon Musk and SpaceX’s crusade against cost-plus contracting, the end of Red Dragon, where NASA policy is heading, and what SpaceX may have in store for the Air Force’s next round of development contracts. This episode of Main Engine Cut Off is brought to you by 16 executive producers—Kris, Mike, Pat, Matt, Jorge, Brad, Ryan, Laszlo, Jamison, Guinevere, Nadim, Peter, and four anonymous—and 63 other supporters on Patreon. Eric Berger (@SciGuySpace) | Twitter Elon Musk knows what’s ailing NASA—costly contracting | Ars Technica Elon Musk’s Mars rocket may be about to lose half of its engines | Ars Technica SpaceX appears to have pulled the plug on its Red Dragon plans | Ars Technica Farewell, Red Dragon - Main Engine Cut Off SpaceX goes there—seeks government funds for deep space | Ars Technica NASA finally admits it doesn’t have the funding to land humans on Mars | Ars Technica Op-ed: We love you SpaceX, and hope you reach Mars. But we need you to focus. | Ars Technica Email your thoughts and comments to [e-mail] Follow @WeHaveMECO Subscribe on Apple Podcasts, Overcast, Google Play, Stitcher, or elsewhere Subscribe to the Main Engine Cut Off Newsletter Buy shirts and Rocket Socks from the Main Engine Cut Off Shop Support Main Engine Cut Off on Patreon

eric thanks for joining me back on the show you're the first repeat guest so uh thanks for enjoying it so much that you came back a second time always happy to come on and talk some space you wrote an article, was that a week or two ago, pretty lengthy article about contracting, given Elon Musk's recent take on contracting and all that hot drama that surrounded it. But you also, in that article, gave a lot of context for how we got to this point and why it's even a point of contention. So maybe that's a good spot to start unless you've got another topic you're dying to start off right up front with. Well, Elon raised this topic when

he met with the National Governors Association and talked about the values of fixed price contracting versus cost plus contracting. And the general difference is that fixed price, you get paid a certain amount of money to deliver a product. And if it costs you more than that, you're in trouble. And if it costs you less than that, you make a profit. And that's how SpaceX prefers to operate. And when it does competitive contracts in that environment, it does very well. Cost plus is a traditional method of contracting where essentially a contractor gets all of its costs paid and then gets Profit on top of that like ten percent so there's no real risk. For the contractor and no great incentive. To deliver a product on

time although some of the cost plus contracts that are being written now. Are trying to incentivize. More timely delivery of products. I'm in cost plus makes a lot of sense when you're trying to develop a new technology. Like if you were going to, you know, put out a bid for a nuclear reactor on the surface of Mars, that would be a cost plus contract, I would think, rather than a fixed price contract. Because you just don't know how much research it's going to take to develop that to operate in the Martian environment. environment. But when you're looking at liftoff or rocket technology or propulsion technology to get into space, do you really need a cost plus contract for that? And I think that's the central debate that Elon was raising, that you have this method of incentivizing companies to deliver products fastly or quickly, to use the proper word, and at a lower cost. And so why isn't the government more aggressively using those? And that's what he told the governors. So the one thing I'm curious about that I've,

I talked about this on the last show a bit with Lauren Grush, that there's even amongst that division between fixed price and cost plus. On the fixed price side, there's even two models there because there's just fixed price in that, you know, we'll give you this much to do this service, you do it and then have a nice day, we'll see you later. And then there's the more commercially focused end that commercial crew and cargo kind of follow

where they were asking for some money to be input by the people winning the contracts, but then they were encouraging people to go out and actually sell what they were creating to the market. And whether it was the entire architecture that they had, or in SpaceX's case, sell the launch services for that same vehicle. SpaceX is the only one that has kind of taken that to heart and really done anything commercially outside of the two contracts. You know, we've had Orbital ATK that have sort of paid lip service to it. Boeing sort of paid lip service to it, talking about potential Bigelow stations, but there's a lot

of question marks there even. Do you think that at all plays into future contracts we might see, that they might lean more like focusing on somebody that can produce commercial incentives beyond the actual contract? Or do you think it's really just going to come down to fixed price versus cost plus? I would just add to that that Sierra Nevada, when it was a player in commercial crew and now that it's in commercial cargo, has put in money of its own into its product. Oh, yeah, yeah. They've all put money in on their own. But nobody seems to be pushing to sell what they're creating

outside of the contract services that they're providing NASA with right now. Well, Sierra Nevada's been talking to the European Space Agency and some businesses over there. So I think they're trying as well. But you're right, And that's one question is how much of a market is there beyond NASA services for these goods? In terms of the fixed price contracts of the future, I don't have a good answer for you. I think that one of the real values of the Commercial Crew Program is that it's a learning environment for both NASA and the

companies. You mentioned, should companies be required to try to sell their goods and services outside of the NASA services? I think another question is, in a fixed price contract, how much oversight does NASA or the government really have in these vehicles and systems that the companies are developing? between Boeing and more so SpaceX and NASA in terms of, you know, arguing over the details and, you know, NASA wanting more information or more paperwork than SpaceX is wanting to provide. And so, you know, they're kind of fighting through that now. And I think in future fixed price environments, that'll be more clearly specified. So on that front, on what may be coming down the line, we heard Elon talk about moon bases in his ISS conference talk. We've also heard them bring up the thought in front of Congress.

I forget who it was from SpaceX. Tim Hughes. That's who it was. They are already lobbying pretty heavily. Do you think that is just them noticing the way that policy seems to be shifting and trying to carve out a piece that that could be the follow on commercial cargo crew and then maybe lunar cargo seems to be the thing they're focused on? Is that is that them responding to what they see? Or do you think there's something more behind the scenes on what they're actually hearing from NASA?

I think that is 100% them seeing which way the wind is blowing out of the Trump space policy, out of senior leaders in Congress who have been saying for a while that they would prefer a return to the moon, um, you know, with, with people boots on the ground there and they're open to, you know, increase commercial activity.

You know, even Scott Pace, um, the new, uh, executive secretary of the national space council. I think that's the correct title. Director.

Um, no, it's executive something. He's in charge of it. Um, he's the, anyway, he, you know, in the past has talked about he has a preference for lunar landings and sees an opening for SpaceX in terms of commercial cargo delivery to the surface of the moon. So you have commercial cargo to the space station, commercial crew. The next evolution with that would be commercial cargo to the lunar surface, or maybe commercial cargo to a deep space gateway. So they see that that's coming. They don't see any appetite, you know, in their discussions with senior administration officials for some kind of big program to go to Mars. And that could change tomorrow if, if Trump

decides he really wants to do that. Um, but, but, you know, it's pretty clear that, that the pendulum is swinging back toward the moon. And there's a number of reasons for that. A combination being that we're just nowhere near ready to go back to the lunar surface. Traditionally, Republicans have been more pro moon because of the national security issues, concerns about China, both sending taikonauts up there, but also the ability to have much more control over assets and geo if you're in the space or on the moon. And so that was coming. I think that was probably coming even with a Hillary Clinton presidency. But they obviously want a piece of the game. I mean, Elon's whole, his most brilliant stroke of business has been to see where there are government funding opportunities and to come in with an innovative plan to not only meet that government service, but also leverage that government investment into doing cool

new things with the technology. And that's exactly what we've seen with the Falcon 9 rocket. He could have just built the Falcon 9 rocket to send cargo to a space station. But no, he wanted to build a rocket that could land and build a whole reusable launch system. And so that is his raison d'etre. And if he sees technologies on the moon that he can ultimately use to further his ambitions to send humans to Mars and get funding for it, he'll absolutely do it. I think the most interesting thing that Tim Hughes said, and it wasn't during his testimony, it was during a Q&A thing, is that they had three suggestions for this next evolution of commercial

contracts in terms of fixed price. One of them was actually cargo to Mars. One of them was, golly, I forget. And the third one, which was the one that stuck out to me, was a contract for vertical takeoff, a vertical landing of vertical takeoff from the lunar surface. And I think that would be some kind of prototype for a Mars vehicle. But obviously, they see that that's where the interest is and they're following the money. Yeah, I think kind of what you were touching on with the way that they developed Falcon 9, the way that they went about that, I think if you look at Falcon 9 versus Antares,

kind of delineates the difference there, that they built something in Falcon 9 that they could iterate on and get to their ultimate goal, where Antares is starting to look quite like a dead end. And much in that vein, we see Red Dragon kind of completely fading out of the plans, and that was similar, where they had this hardware that they were going to do something with NASA for, but they also could extend it to be a lander out to Mars. Given the timeline shiftings, it's not happening anymore. Well, we'll talk about Red Dragon in a second. We can have a requiem for Red Dragon. But that was one of the other things that they did with the NASA money. I mean, it was pretty amazing all the things they were trying to do with the Falcon 9 rocket. They were testing propulsive landing for the surface of Mars with the Falcon 9 rocket. And by that, I mean they were specifically

getting data when they were in the upper parts of the atmosphere and that rocket was coming back. And I forget how many kilometers it was above the surface, but pretty high up there, you can actually simulate the Martian atmosphere. It's quite thin. And so they were getting lots of data about the ability of thrusters to slow the vehicle and so forth that they were going to use to propulsively land Red Dragon. And so you're right. That's the difference, right? Under a traditional cost plus contract, government wants a service, whether they want a pencil or a box or a rocket, and you build that, your company builds that, and then gives it to the government. And the fixed price new space ethos that SpaceX embodies is, OK, we really want that government money, and we're going to provide you the service. But what we really want to do

is try to innovate, use that money to invest and kind of, you know, really do other interesting things that ultimately further our goals down the road. And so Red Dragon was a big part of that. And obviously it got canceled. And the main reason it got canceled is that, you know, commercial crew, we all remember it was in 2014. I think Elon had his big, big dog and pony show in Hawthorne, California, where he rolled out the Dragon 2 spacecraft. And he said, this is how a 21st century spacecraft should land. And he may regret that now. Yeah, that's going to come back to him quite a lot. But because obviously the commercial crew,

at least initially the Dragon was going to land in water, but eventually they wanted to use the Super Draco thrusters, have a controlled propulsive landing on the ground. The officials here in Johnson Space Center and elsewhere in NASA, you know, just could not get comfortable with that way of landing crew. And so it not only wasn't going to happen with the initial commercial crew landings, it wasn't going to happen with any of them through 2024. And so SpaceX decided, well, if we can't continue to

use our commercial crew funds for this purpose and we need to focus on water landings, then we can't continue to innovate and get to the point where Red Dragon makes sense. And that's a real shame because Red Dragon would have been just an amazing mission, landing almost an order of magnitude greater amount of mass on the surface of Mars, whether you succeeded or failed. And trying to do that propulsively to prove out technologies that could allow SpaceX, NASA, or someone else to eventually land humans on Mars would have been a really big deal.

And so it's a shame to see it go. Mars would have been a really big deal. And so it's a shame to see it go. I wonder if the timing of the announcement of the lunar tourism that they're going to do with Dragon 2, that was back, what was that, February, March, sometime in the late winter, early spring. I wonder how much those two things are related, that Red Dragon was fading out of existence and they kind of freed up some of their time in that the team that might have been focused on Propulsive Landings and developing the other things that Dragon 2 was going to do, if they knew that they weren't going to be devoted to that anymore, it kind of did free up a little bit of time to take on other missions with Dragon 2. And I wonder how much of that influenced their decision to

whether or not they were proactively seeking people to fly on Dragon 2, or if they just got approached like they said they did, that they were open to it because they knew that Dragon 2's ultimate goal was shifting. Well, I have a conspiracy theory about that, which I don't have much evidence to back up, but, but seems to make sense with what I know about space policy. If you recall at that time, it came out that NASA was just starting to,

was, was, had been asked to consider putting crew on exploration mission one, EM one, the first flight of SLS and the crude version of Orion. Um, this was like the same week, like a day after they were like, they were within one day with one another. And I was told that Elon had been told for whatever reason that this was not

going to be publicized or something. And whatever happened is that that word got broken or he was upset. And basically that announcement was to essentially show the Trump administration that, oh, yeah, they could do it in 2019. So could we. And and that that was largely a politically driven decision. I don't know of anyone who really thinks that that was it. Did they originally say we're going to do that in 2018? Late 2018. Yeah.

Yeah. That's crazy. 2019 is crazy. You know, I have a very hard time seeing that mission happening. Well, ever, but certainly before the early 2020s. Well, ever, but certainly before the early 2020s. It's a huge leap to go from launching cargo to the International Space Station to doing Apollo 8. I mean, you're skipping Mercury, you're skipping Gemini, you're skipping Apollo 1 and Apollo 7 and going straight to Apollo 8. I mean, they're pretty good out there in Hawthorne, but I don't see them doing that. And they're not going to start regular commercial crew missions until 2018 or early 2019.

I don't see how you get to that program anytime soon. My take is that they probably would fly that with a reused Dragon 2 capsule at some point. Whenever they were done with a Dragon 2 capsule and they weren't going to be doing any more testing on it post-flight or anything like that, I bet they would shift it towards some sort of tourism

only because I'm pretty sure that the NASA contract is for all new spacecraft, at least on the first commercial crew contract, the same way that commercial cargo was. I don't think that they have any reuse built in. I'm not sure, though. I don't know. I don't know. I suspect that's something that NASA might actually be willing to modify down the line. I would be interested. I don't know the answer to this, what the original contract for cargo to

station said. But it was interesting this week that after the next flight, all the future missions to station will be on reusable dragons. I cannot imagine a cargo... Elon says that the Dragon 2 is already rated to come back from lunar, cislunar space with its overbuilt heat shield. I have a hard time believing that. I certainly haven't seen any kind of data or information from the company that backs that up. It just seems like a huge stretch. Why, when you're concerned about mass and cost, are you building a much more capable heat shield

versus a crew coming back from low Earth orbit versus what you actually need to come back from the moon. So I can't... And if you're spending half a billion dollars or whatever these tourists are going to be spending, and I don't have any idea how much it is, I think you're going to want a new spacecraft. I mean, maybe you fly a reused booster,

but I don't know. I don't think you're worried about the $10 million savings or whatever it would be at that point. You're operating on a different spectrum at that point when you're buying a flight to the moon. Yeah, the heat shield thing is, I'm curious about that too. I wonder if they're just relying, you know, their statements are based on the fact that the material they're using for the heat shield has historically been tested up to lunar return and Martian return velocities. And they actually haven't built one that can do that yet, but they have the historical data from when NASA was working on it that it can support that. I'm not sure where they fall on that, but I wouldn't be surprised if that's where they were leaning on. I would be thrilled and super impressed if they flew that mission uncrewed.

So you take one of your early commercial cruise spacecraft, refurbish it, and then fly it on a second or third flight of Falcon Heavy. Do that in early 2019, and you've still beaten NASA with its much-balled-hood EM-1 mission. Yeah. It would be pretty incredible. 2DM1 mission, you know, it would be pretty incredible. He seems to be, he being Elon, seems to be getting a lot more brazen with the way that he's positioning himself with these future NASA contracts. The sleeping giant in this regarding fixed price contracts, commercial cargo to the moon,

that kind of thing, Blue Origin is creeping under the surface there. They've, in the past past year have done some of the similar lobbying, if you can call it that, where they've said, hey, what do you guys think about doing a commercial cargo to the moon program? We've got this lander. We could probably modify it. They've been pushing that story a little bit. I wouldn't be surprised if that ramps up once they get back to flying New Shepard. How do you see that playing out? Do you think they would be a major player in the next round of fixed price contracting, or do you see that playing out? Do you think they would be a major player in the next round of fixed price contracting, or do you think it's still too soon to see Blue Origin put their

toes in the water in that way? It depends on the service. If you're talking about lunar activities, either robotic landings or some role in future crew activities by supporting that with cargo or whatever, yes, Blue Origin, I am 100% confident would want to be a major player in that. I've talked a little bit about this, but there will be some kind of RFP from NASA coming out this fall that basically, you know, opening it up to companies. So last, I'm not sure if it was late last year or early this year, NASA put out an RFI basically soliciting input from industry about ideas for lunar activities and how they could help. And I know for sure that Blue Origin was among several companies that responded to that and that the leadership at NASA and the administration have seen that. that the leadership at NASA and the administration have seen that.

And there is a forthcoming RFP that will take that a step further and start to consider architecture. And I don't have great details about that, but I know there will be a lot of interest in that. I know that Blue Origin will be bidding on that. And obviously we saw with Bezos telling the Washington Post about his Blue Moon idea. That is their major focus of interest. They are much more interested in the moon. They're not interested at all in Mars. And so you will see that, yeah, over the next year, there will be major players in that.

And there will be interesting competition, actually, between SpaceX, which historically has been focused on Mars, but sees NASA money going toward the moon, United Launch Alliance, which has made its raison d'etre over the next decade, the use of the ACES upper stage to serve as a ferry between Earth and cislunar space, and even has a potential lander for the surface of the moon. And then Blue Origin, which seeks to operate between low Earth orbit and cislunar space. And so there's a lot of companies in that area. And the question is, if NASA does pivot back to the moon, at the end of the day, how much

use is the Space Launch System in Orion spacecraft? And over the next decade, at least, the short answer is it's not a whole lot. Obviously, you can get people there in Orion and back if everything goes to schedule, but it's not a particularly useful system to get down to the surface or to low lunar orbit. Yeah, it seems like they're positioning it to focus the old spacey environment on SLS Orion and Deep Space Gateway and then cultivate some sort of commercial cargo program around lunar access or lunar surface access from the deep space gateway. They're playing a little bit to each side in that regard. So I'm given where they're at. I actually don't think that's a bad strategy because SLS Orion has nearly unbreakable support in Congress right now. We saw yesterday the bill that passed the House and the Senate funded them exactly to the levels actually higher than the levels that was requested. And it

funded commercial crew to the level that was requested. So there is support across the board, though money is tight. And if they found this way to play to both sides and let Boeing and Lockheed and Orbital ATK and all them work on SLS Orion, work on commercial or deep space gateway habitats, but then throw some bones over to the Blue Origin and SpaceX way in getting down to the surface. It's not perfect, but I think it could work out. I would just say that I think that support for SLS is pretty unbreakable, especially in kind of what I've learned over the last couple of weeks. I would not be 100% sure about Orion.

That's interesting. Because that's a $1.35 billion hole in the annual budget. And if Dragon really is capable of coming back from the moon, if Blue Origin is planning to build such a vehicle, and it fits better within their launch systems, you could see, I could certainly see a scenario in which NASA goes back to a standpoint of, we need to separate, we need to have a cargo rocket, we need to have crew rockets. And the crew rockets we like are Falcon 9, or Vulcan, or New Glenn, these high flight

rate rockets which are proven. And then you put, you maybe, maybe you build it, maybe you have like a modular moon base and you want to launch it on your SLS to get into cistern or space, or you've got your scientific payloads and that's what you're going to use SLS for. Yeah. I think that's, I think that's a plausible scenario. But, you know, the space policy discussion is so messy right now. No one, you know, there's not much clarity at Pence. Obviously, the vice president hasn't had a whole lot of time to focus on these issues. Pace is just Scott Pace is just starting to get to work.

There's not a NASA administrator yet, although there's some names that are interesting. I think they're getting close to naming a deputy NASA administrator. And so all of this is very fungible. But I think what we can say for sure is that, yes, they are looking back sort of toward the moon. And it may just be the deep space gateway, but more likely it would be either the deep space gateway and some kind of lunar landings or some kind of lunar landings. some kind of, some kind of lunar landings. I have one more thing I wanted to ask you about. Uh, we're getting close on time here. After the Amos six incident last September, uh, you had an article about SpaceX and what they were working on and how there were some members within NASA and within the general community at large that felt that SpaceX's focus was spread too thin, that they're working on too much, and that they weren't focusing on

the things that they thought should be their priority. Given the shifting of Red Dragon plans and of the year that SpaceX is having, where they are proving that they are on a good track record, they are knocking down some of these Crew Dragon milestones. Where do you think that feeling is at today? Is everyone within NASA still feeling that way, or does it start to feel like SpaceX is getting more focused and getting more to what they need to be getting to this year? I would answer that two ways. First of all, I would say that

SpaceX is still a company that's trying to do many different things and is trying to look beyond the borders of its contracts to do other interesting things with those funding, as we've seen with the commercial crew and talk about the lunar flyby with Crew Dragon spacecraft. On the other hand, the company's had a great year. They've launched all these rockets. They've landed. They've continued landing. Their success for landing is going up. They've flown a reasonable booster twice. And that has opened up them to kind of move toward this Block 5 rocket, which is the version of the booster that the crew will fly on. And so I think they're making some good progress. I think they're focused on it. I know for a fact that Elon desperately wants to win that race. And yes, you know, sort of giving up the ghost on propulsive landings for Dragon, I know that had to be a very painful step for the

company. And so that suggests to me that they're willing to make some hard choices to get their spacecraft to the launch pad. I cannot confidently say whether their focus is entirely where it needs to be, but they have made really impressive strides. The focus of that article that I wrote was saying, hey, guys, the core of your business is the Falcon 9 rocket. This is what flies cargo, is going to fly crew, flies all your commercial payloads. It's how you're going to prove out reusability. And if it works, you could dominate the global launch market with just the Falcon 9 rocket. And then, oh, by the way, you're going to need that as your core and boosters for Falcon Heavy. And it's just, you know, and to their credit,

I think they have focused on the Falcon 9 rocket. And they've gone through, they've upgraded it. It's flown perfectly this year. So let's see where they get... For me, the most important thing and the most interesting thing to watch with the company is when they actually fly the Block 5.

Because I think that has to fly six or eight times before they'll eventually put people in a dragon on top of it. And so let's see how that goes. I have heard some little birdies tweeting that the first Block 5 is being bolted together out in Hawthorne. I don't know when that means it would hit the launch pad, but given the upgrades we've seen the last couple of flights with titanium grid fins and some other intermediate changes between where they're at and Block five it seems like this year they are going to get that on the launch pad so that may actually be the only thing the only new thing to fly this

year that they said last year would fly this year we're not going to see the crew demo flight we may see falcon heavy but that seems like a tight deadline as well. But it does seem pretty, pretty comfortable that we will see Block 5 this year. And like you're saying, that's a big step in its own right to get anything else going on on the Falcon architecture. Yeah, I'm not sure we'll see it this year. I'd love to see it. I'd love to see it this year. I'm, you know, I'm interested to see questions like, you know, how long does it really take to turn around? And will they fly one of these Block 5s, you know, two or three times? Like, do they say this is the one that eventually will be capable of 24-hour turnaround?

I'm not sure. Is it dozens of flights? How many flights did you say that it would be? Tens without touching anything, and then hundreds with light refurbishment, I think, is the general framework. Well, that seems characteristically optimistic for me, but if they could get like five flights out of one of these, that would be pretty amazing. So, you know, let's, let's, let's, let's watch that. You know, the other thing I would just, just mention, we were talking about contracts and you mentioned kind of the, the big,

the big kind of unspoken one out there. And I thought you were going to go to this Air Force ELV contract. You had a show on this maybe a couple months ago where you – I learned quite a bit. the Atlas V and the RD-180 engine and sort of how SpaceX might look to that second round of contracting, either to get additional money to fund its Raptor engine or to upgrade the Falcon Heavy upper stage or what have you to more sort of fully meet the Department of Defense's needs. I'm just wondering what you've heard about that maybe that you could share. I've got nothing on the little birdie front on that, but I know they are supposed to have all of the proposals submitted by the end of this summer, and then they will release something later this year. So given the timetable for when

Elon's going to be unveiling the new Mars architecture, that's also in September. So those timelines do sync up a bit that he could say that they are going to try to offer this as something to government, commercial, you know, partners in any regard. So if we see the announcement from him, and it is more focused on being useful to anyone but SpaceX, I would be pretty confident that they put in a bid related to Raptor, you know, because they had they had a Raptor engine development contract on the last round. But that that was just for the engine that didn't talk anything about an upper stage. It talked

about a hypothetical upper stage. So it's it's tough to read the tea leaves because we've heard let's make a new upper stage that's reusable that can go on Falcon Heavy. And now we've heard let's make a downsized, fully reusable system. That's a lot of crossover in the way that the Air Force would be interested in, at least from what it looks like from here. I agree with you. That's the thing that I'll be watching for most in September when he does his presentation, is how much of this might be useful to the Department of Defense, and is there any evidence that he's going to find some government funding for these systems, because then that makes them much more real than they would otherwise be. Well, then we will have to circle back maybe later this summer when we hear some of this stuff coming out,

and we'll do another one of these about the Air Force round two, which will be exciting in its own right. Sounds great. Thank you very much, Eric. I always enjoy talking to you. So hopefully you will come back soon and we will get to nerd out a bit more. Okay. Have a great day. That's Eric Berger of Ars Technica.

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