DoD's $136.6M National Security Space Launch contract awarded to SpaceX for satellite deployment
Contract Overview
Contract Amount: $136,634,569 ($136.6M)
Contractor: Space Exploration Technologies Corp.
Awarding Agency: Department of Defense
Start Date: 2024-08-19
End Date: 2025-08-18
Contract Duration: 364 days
Daily Burn Rate: $375.4K/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: HAWTHORNE, LOS ANGELES County, CALIFORNIA, 90250
Plain-Language Summary
Department of Defense obligated $136.6 million to SPACE EXPLORATION TECHNOLOGIES CORP. for work described as: NATIONAL SECURITY SPACE LAUNCH PHASE 2 Key points: 1. Value for money assessed through competitive bidding process. 2. Competition dynamics indicate a robust market for space launch services. 3. Risk indicators include reliance on a single provider for this specific delivery order. 4. Performance context is critical for national security satellite deployment timelines. 5. Sector positioning highlights the growing role of private companies in space operations.
Value Assessment
Rating: good
The contract value of $136.6 million for a single delivery order appears reasonable given the specialized nature of national security space launches. Benchmarking against similar large-scale satellite deployment contracts is challenging due to proprietary data and unique mission requirements. However, the firm-fixed-price structure suggests a degree of cost certainty for the government, provided the contractor meets all performance specifications.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, suggesting multiple qualified bidders were considered. The specific number of bidders is not detailed, but the open competition is a positive sign for price discovery and ensuring the government receives competitive offers. This approach helps mitigate the risk of inflated pricing that can occur with less competitive solicitations.
Taxpayer Impact: Taxpayers benefit from the competitive process which aims to secure the most cost-effective solution for critical national security space launch capabilities.
Public Impact
The primary beneficiaries are national security agencies requiring reliable satellite deployment. Services delivered include the launch and deployment of national security satellites. Geographic impact is global, as satellites launched will operate in orbit. Workforce implications include specialized jobs in aerospace engineering, launch operations, and mission control.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for schedule delays if launch vehicle or ground support issues arise.
- Dependence on a single contractor for this specific launch mission increases single-point-of-failure risk.
- Geopolitical factors could impact launch windows or international cooperation.
Positive Signals
- SpaceX has a proven track record of successful launches and payload delivery.
- Firm-fixed-price contract provides cost predictability.
- Experienced contractor in the rapidly evolving commercial space sector.
Sector Analysis
The National Security Space Launch (NSSL) program is a critical component of the U.S. defense strategy, ensuring access to space for national security missions. This sector is characterized by high technological barriers to entry, significant R&D investment, and a limited number of highly specialized providers. Spending in this area is substantial, reflecting the strategic importance and complexity of space-based assets. This contract fits within the broader NSSL framework, which aims to maintain assured access to space through a competitive environment.
Small Business Impact
This contract does not appear to involve a small business set-aside. Given the scale and technical requirements of national security space launches, prime contracting opportunities are typically limited to large, established aerospace companies. Subcontracting opportunities for small businesses may exist within the supply chain for components or specialized services, but this is not explicitly detailed in the provided data.
Oversight & Accountability
Oversight for this contract likely falls under the Department of the Air Force's program management and contracting offices, with potential involvement from the Department of Defense's Inspector General. Accountability measures are tied to the firm-fixed-price contract terms, requiring successful launch and payload delivery. Transparency is generally limited for national security space programs due to classification requirements, but contract awards and basic details are publicly available.
Related Government Programs
- National Security Space Launch (NSSL)
- Space Systems Command (SSC) Contracts
- Satellite Deployment Services
- Orbital Launch Services
Risk Flags
- Potential for launch failure
- Schedule slippage risk
- Dependence on specific launch vehicle technology
- Geopolitical instability impacting launch operations
Tags
defense, department-of-defense, air-force, space-launch, national-security, satellite-deployment, firm-fixed-price, full-and-open-competition, california, spacex, aerospace, delivery-order
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $136.6 million to SPACE EXPLORATION TECHNOLOGIES CORP.. NATIONAL SECURITY SPACE LAUNCH PHASE 2
Who is the contractor on this award?
The obligated recipient is SPACE EXPLORATION TECHNOLOGIES CORP..
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 $136.6 million.
What is the period of performance?
Start: 2024-08-19. End: 2025-08-18.
What is SpaceX's historical performance record with the Department of Defense for similar launch contracts?
SpaceX has a strong and growing track record with the Department of Defense, particularly within the National Security Space Launch (NSSL) program. They have successfully executed numerous missions under NSSL Phases 1 and 2, delivering national security payloads to orbit. Their performance has generally been characterized by reliability and adherence to launch schedules, contributing to the program's goal of ensuring assured access to space. While specific contract performance metrics are often sensitive, SpaceX's consistent selection for high-priority national security missions by the DoD indicates a high level of confidence in their capabilities and past performance.
How does the $136.6 million cost compare to previous or similar national security space launch contracts?
Direct cost comparisons for national security space launch contracts are complex due to varying mission requirements, payload sizes, orbital destinations, and the specific launch vehicles used. The $136.6 million for this delivery order represents a portion of the overall NSSL program's expenditure. Historically, NSSL contracts have ranged from tens of millions to over a hundred million dollars per launch, depending on these factors. SpaceX's pricing within the NSSL framework has been noted for its competitiveness. This specific award, being a delivery order under a larger contract vehicle, should be viewed in the context of the overall program's value and the competitive bidding that established the baseline pricing.
What are the primary risks associated with this specific contract and contractor?
The primary risks associated with this contract include technical failures during launch or deployment, schedule delays impacting national security operations, and potential cost overruns if unforeseen issues arise (though mitigated by firm-fixed-price). For SpaceX specifically, risks could involve reliance on their Falcon 9 or Falcon Heavy launch vehicles, potential supply chain disruptions, or evolving regulatory requirements. Given the critical nature of national security payloads, any launch failure or significant delay carries substantial strategic implications. The government also faces the risk of over-reliance on a limited number of providers within the NSSL program.
How effective is the NSSL program in ensuring reliable access to space for national security needs?
The National Security Space Launch (NSSL) program is designed to ensure reliable and affordable access to space for national security missions. It achieves this by fostering competition between multiple launch providers, primarily United Launch Alliance (ULA) and SpaceX. This competitive environment drives innovation, improves mission assurance, and helps control costs. The program has demonstrated effectiveness through a high success rate of launches carrying critical national security payloads. By diversifying launch capabilities and providers, NSSL mitigates risks associated with single points of failure and ensures the U.S. maintains its strategic advantage in space.
What is the historical spending trend for national security space launch services by the Department of Defense?
Historical spending for national security space launch services by the Department of Defense has been substantial, reflecting the critical importance of space-based assets for intelligence, communication, navigation, and missile warning. Prior to the NSSL program, spending was often associated with sole-source or less competitive contracts. The NSSL program, initiated to introduce more competition and cost-effectiveness, has seen significant investment. Annual spending under NSSL can fluctuate based on the number and complexity of missions scheduled, but it consistently represents billions of dollars over multi-year periods as the DoD procures launch services for its most vital space assets.
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
Address: 1 ROCKET RD, HAWTHORNE, CA, 90250
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $136,634,569
Exercised Options: $136,634,569
Current Obligation: $136,634,569
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA881120D0002
IDV Type: IDC
Timeline
Start Date: 2024-08-19
Current End Date: 2025-08-18
Potential End Date: 2025-08-18 00:00:00
Last Modified: 2025-08-18
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