The relevance of economic data in the decision-making process for orbital launch vehicle programs, a U.S. perspective

Abstract

Over the past fifteen years, major U.S. initiatives for the development of new launch vehicles have been remarkably unsuccessful. The list is long: NLI, SLI, and X-33, not to mention several cancelled programs aimed at high speed airplanes (NASP, HSCT) which would share some similar technological problems. The economic aspects of these programs are equally as important to their success as are the technical aspects. In fact, by largely ignoring economic realities in the decisions to undertake these programs and in subsequent management decisions, space agencies (and their commercial partners) have inadvertently contributed to the eventual demise of these efforts. The transportation revolution that was envisaged by the promises of these programs has never occurred. Access to space is still very expensive; reliability of launch vehicles has remained constant over the years; and market demand has been relatively low, volatile and slow to develop. The changing international context of the industry (launching overcapacity, etc.) has also worked against the investment in new vehicles in the U.S. Today, unless there are unforeseen technical breakthroughs, orbital space access is likely to continue as it has been with high costs and market stagnation. Space exploration will require significant launching capabilities. The details of the future needs are not yet well defined. But, the question of the launch costs, the overall demand for vehicles, and the size and type of role that NASA will play in the overall launch market is likely to influence the industry. This paper will emphasize the lessons learned from the economic and management perspective from past launch programs, analyze the issues behind the demand for launches, and project the challenges that NASA will face as only one new customer in a very complex market situation. It will be important for NASA to make launch vehicle decisions based as much on economic considerations as it does on solving new technical challenges.