DoD's $10.5B National Security Space Launch contract awarded to United Launch Services for critical space access
Contract Overview
Contract Amount: $105,049,500 ($105.0M)
Contractor: United Launch Services, LLC
Awarding Agency: Department of Defense
Start Date: 2023-12-07
End Date: 2028-12-29
Contract Duration: 1,849 days
Daily Burn Rate: $56.8K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: NATIONAL SECURITY SPACE LAUNCH PHASE 2
Place of Performance
Location: ENGLEWOOD, ARAPAHOE County, COLORADO, 80112
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $105.0 million to UNITED LAUNCH SERVICES, LLC for work described as: NATIONAL SECURITY SPACE LAUNCH PHASE 2 Key points: 1. Contract aims to ensure reliable and cost-effective access to space for national security missions. 2. Competition dynamics are crucial for driving innovation and managing costs in the space launch sector. 3. Performance hinges on successful launch execution, satellite deployment, and adherence to mission timelines. 4. This contract represents a significant portion of the DoD's investment in space-based capabilities. 5. The sector is characterized by high barriers to entry and evolving technological demands.
Value Assessment
Rating: good
The total contract value of $10.5 billion over approximately five years suggests a substantial investment in space launch capabilities. Benchmarking this against similar large-scale national security space launch contracts is challenging due to the unique nature and high stakes involved. However, the firm-fixed-price structure aims to provide cost certainty. Value for money will be assessed based on successful mission completions, reliability, and the ability to meet evolving national security requirements within budget.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. This approach is designed to foster a competitive environment, potentially leading to better pricing and innovative solutions. The specific number of bidders is not provided, but the full and open nature suggests a robust selection process.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple providers to offer their best pricing and capabilities, driving down costs and increasing the likelihood of securing services at a competitive rate.
Public Impact
National security missions, including intelligence gathering, missile warning, and secure communications, will benefit from reliable space access. The contract supports the deployment and operation of critical satellites essential for defense and intelligence. Geographic impact is national, with launch operations likely concentrated at specific spaceports. Workforce implications include highly skilled engineers, technicians, and support staff in the aerospace and defense industries.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if launch failures occur or if unforeseen technical challenges arise.
- Dependence on a limited number of launch providers could create future bottlenecks.
- Geopolitical events could impact supply chains for critical components.
Positive Signals
- Firm-fixed-price contract provides cost predictability.
- Full and open competition encourages multiple bidders, potentially leading to better value.
- Long-term nature of the contract allows for strategic planning and investment in capabilities.
Sector Analysis
The National Security Space Launch (NSSL) program is a cornerstone of the U.S. defense strategy, ensuring access to space for critical national security assets. This sector is characterized by extremely high technical requirements, significant regulatory oversight, and substantial R&D investment. The market is dominated by a few key players capable of meeting the stringent demands of launching heavy payloads into orbit. Spending in this area is substantial, reflecting the increasing reliance on space-based capabilities for defense, intelligence, and global operations.
Small Business Impact
While this contract is a large prime award, the nature of space launch services typically involves highly specialized capabilities that may limit direct small business participation as prime contractors. However, opportunities for small businesses often exist further down the supply chain, providing components, specialized services, or research and development support. The prime contractor will likely be required to outline their subcontracting plan, which could include specific goals for small business utilization.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Air Force, with potential involvement from the Space Force and the Office of the Inspector General. Accountability measures will include adherence to launch schedules, mission success rates, and financial reporting. Transparency is typically maintained through contract awards and performance reporting, though specific operational details may be classified due to national security implications.
Related Government Programs
- National Security Space Launch (NSSL)
- Space Force Launch Services
- Commercial Satellite Deployment
- Defense Satellite Communications Systems
Risk Flags
- Potential for launch failures
- Supply chain vulnerabilities
- Dependence on limited providers
- Evolving technological requirements
Tags
defense, space-launch, national-security, department-of-defense, air-force, united-launch-services, firm-fixed-price, full-and-open-competition, large-contract, multi-year, colorado, aerospace
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $105.0 million to UNITED LAUNCH SERVICES, LLC. NATIONAL SECURITY SPACE LAUNCH PHASE 2
Who is the contractor on this award?
The obligated recipient is UNITED LAUNCH SERVICES, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $105.0 million.
What is the period of performance?
Start: 2023-12-07. End: 2028-12-29.
What is the historical spending trend for the National Security Space Launch program?
The National Security Space Launch (NSSL) program has seen significant and consistent investment over the years, reflecting the growing importance of space-based assets for national security. The program evolved from earlier initiatives like the Evolved Expendable Launch Vehicle (EELV) program. Spending has been in the billions annually, with contracts awarded to key providers like United Launch Services and SpaceX. The NSSL Phase 2, valued at $10.5 billion, represents a continuation and expansion of this commitment, aiming to secure launch services through the late 2020s. This sustained funding underscores the strategic priority placed on reliable access to space for critical defense and intelligence missions, ensuring the U.S. maintains its technological edge in this domain.
How does the pricing structure of this contract compare to previous launch service agreements?
This contract utilizes a firm-fixed-price (FFP) structure, which is common for large, complex programs like NSSL where cost certainty is a high priority for the government. FFP contracts shift most of the risk to the contractor, obligating them to complete the work for a predetermined price. While specific historical pricing data for comparable contracts is often sensitive, the NSSL program generally aims for competitive pricing through its full and open competition approach. Benchmarking against older contracts would need to account for inflation, technological advancements, and the evolving market dynamics, including increased competition from new entrants. The goal of FFP in this context is to ensure predictable expenditures for taxpayer-funded space launches.
What are the primary risks associated with the successful execution of this contract?
The primary risks associated with the successful execution of the National Security Space Launch Phase 2 contract are multifaceted. Technical risks include launch failures, which can be catastrophic, leading to loss of payload and significant program delays. Schedule risks arise from potential delays in rocket development, testing, or integration, as well as external factors like supply chain disruptions or regulatory hurdles. Cost risks, though mitigated by the FFP structure, can still emerge from unforeseen technical challenges requiring extensive rework or from contractor performance issues. Furthermore, geopolitical instability could impact the availability of critical materials or international cooperation. The government also faces programmatic risk if the chosen launch vehicles do not meet evolving mission requirements or if competition diminishes in the future.
What is the track record of United Launch Services in fulfilling similar large-scale government contracts?
United Launch Services (ULS), a joint venture between Boeing and Lockheed Martin, has a long and established track record in supporting the U.S. government's space launch needs. They are the primary provider for the National Security Space Launch (NSSL) program, having successfully executed numerous missions under the previous Evolved Expendable Launch Vehicle (EELV) program and continuing into NSSL Phase 1 and now Phase 2. ULS has demonstrated reliability in launching a wide array of national security payloads, including satellites for intelligence, missile warning, and communications. Their experience encompasses managing complex launch operations, adhering to stringent security protocols, and meeting demanding mission requirements. While specific performance metrics are often classified, their continued selection for critical NSSL contracts indicates a strong history of successful mission execution and reliability.
How does this contract contribute to the overall effectiveness of U.S. national security space capabilities?
This contract is fundamental to the effectiveness of U.S. national security space capabilities by ensuring consistent and reliable access to orbit for critical assets. The NSSL program underpins the deployment of satellites that provide essential services such as intelligence, surveillance, reconnaissance (ISR), missile warning, protected communications, and position, navigation, and timing (PNT). By securing launch services through a competitive, long-term contract, the Department of Defense (DoD) can maintain a robust space architecture capable of deterring adversaries and responding to threats. The reliability and availability of these launch services directly translate to the operational readiness and effectiveness of military forces globally, ensuring that the U.S. maintains its strategic advantage in the space domain.
Industry Classification
NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Freight Air Transportation
Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: United Launch Alliance, L.L.C
Address: 9501 E PANORAMA CIR, CENTENNIAL, CO, 80112
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $108,339,000
Exercised Options: $108,339,000
Current Obligation: $105,049,500
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA881120D0001
IDV Type: IDC
Timeline
Start Date: 2023-12-07
Current End Date: 2028-12-29
Potential End Date: 2028-12-29 00:00:00
Last Modified: 2025-12-18
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