As Space Force works with Vulcan more, the costs go up

One of the so-called Golden Rules of manufacturing is that the more of something you make the lower the unit price goes.  The usual way you see that stated is that when a company doubles the quantity of whatever they're making, the unit price drops by about 25 to 30%.  Yeah, it depends on the quantities and exactly what they're making but it basically comes down to the maker becoming more efficient at what they're doing, wasting less time per unit and the fact that they're generally buying parts from lower-level suppliers and the more parts they buy, the more their prices get "quantity discounts."  

Which is one of the reasons the headline at Ars Technica surprised me saying, “Pentagon contract figures show ULA’s Vulcan rocket is getting more expensive.” If they're building more and getting better at it, why should the price go up? 

The headline story gets buried because, like Lucy, they got some splainin' to do.  The meat of the story is that this time of year, the ending of the old fiscal year and before the start of the fiscal new year,  the US space Force convenes a Mission Assignment Board to dole out contracts to launch the nation's most critical national security satellites. The military announced this year's launch orders Friday, and SpaceX was the big winner. 

Space Systems Command, the unit responsible for awarding military launch contracts, selected SpaceX to launch five of the seven missions up for assignment this year. United Launch Alliance (ULA), a 50-50 joint venture between Boeing and Lockheed Martin, won contracts for the other two. These missions for the Space Force and the National Reconnaissance Office are still at least a couple of years away from flying. 

It's essentially meaningless to just say the contracts went to ULA and SpaceX because they're the only two companies with rockets certified by the Space Force to launch the Pentagon's big-ticket satellites. They had to award the contracts to those two.  

ULA's Vulcan rocket, which replaces the company's Atlas V, debuted nearly two years ago and successfully launched its first national security mission in August. SpaceX's Falcon 9 and Falcon Heavy rockets each have long track records of success. 

If you're saying "what about New Glenn?" The answer is they're not certified by Space Force yet, so they can't legally launch those payloads.  

That's the background.  Here's where it gets a little attention focus.  

The Space Force is paying SpaceX $714 million for the five launches awarded Friday, for an average of roughly $143 million per mission. ULA will receive $428 million for two missions, or $214 million for each launch. That's about 50 percent more expensive than SpaceX's price per mission.

While notable, these prices are close to the numbers from the last batch of contracts, when SpaceX charged $121 million per mission, and ULA's price was $214 million per launch, the same as this year. Part of this price difference could be explained by SpaceX's reuse of Falcon boosters, whereas ULA's Vulcan rocket is a disposable design.

But look back a little further and you'll find ULA's prices for Space Force launches have, for some reason, increased significantly over the last few years. In late 2023, the Space Force awarded a $1.3 billion deal to ULA for a batch of 11 launches at an average cost per mission of $119 million. A few months earlier, Space Systems Command assigned six launches to ULA for $672 million, or $112 million per mission. 

If you're trying to figure the cost per launch, you have to figure in that Space Force can change the contract during the course of the contract.

ULA and SpaceX competed for military launch orders from 2020 through 2024 as part of the Space Force's NSSL Phase 2 contract. The Space Force added more money to each company's Phase 2 contract—$1.1 billion for ULA and $661 million for SpaceX—in mid-2024 to help cover a higher number of launches than the military originally expected.

Accounting for this funding surge, ULA's total haul of 26 Phase 2 launches came in at an average of $173 million per mission, still significantly less than ULA's prices this year. SpaceX's average launch price was $182 million, far more than the company's prices in 2025. Part of SpaceX's Phase 2 contract money went toward upgrades of ground infrastructure and development of an extended payload fairing for the Falcon Heavy rocket.

I have to admit being rather fond of the Falcon Heavy, which directly comes from my study of the Space Launch System at the heart of the Artemis program.  As I've said many times, the SLS can launch more payload than the Falcon Heavy, but not that much more. It's like 30% more payload, so "all ya gotta do" is launch two Heavies.  One launch of an SLS costs over $4 Billion.  Two Falcon Heavies cost less than 10% of the one SLS launch.  So throw up TWO Heavies and save the $3.6 billion.  

A SpaceX Falcon Heavy rocket with NASA's Psyche spacecraft launches from NASA's Kennedy Space Center in Florida on October 13, 2023. Credit: Chandan Khanna/AFP via Getty Images

Here's a breakdown of the seven new missions assigned to SpaceX and ULA:

• USSF-149: Classified payload on a SpaceX Falcon 9 from Florida

• USSF-63: Classified payload on a SpaceX Falcon Heavy from Florida

• USSF-155: Classified payload SpaceX Falcon Heavy from Florida

• USSF-205: WGS-12 communications satellite on a SpaceX Falcon Heavy from Florida

• NROL-86: Classified payload on a SpaceX Falcon Heavy from Florida

• USSF-88: GPS IIIF-4 navigation satellite on a ULA Vulcan VC2S (two solid rocket boosters) from Florida

• NROL-88: Classified payload on a ULA Vulcan VC4S (four solid rocket boosters) from Florida

Not sure when we can expect these, other than "not soon" but four more Falcon Heavy launches sounds like fun.