Space Force raises the stakes as rocket companies compete for lucrative military missions

The
U.S.
military
is
raising
the
stakes
—
and
widening
the
field
—
on
a
high-profile
competition
for
Space
Force
mission
contracts.

The
Space
Force
plans
to
buy
even
more
rocket
launches
from
companies
in
the
coming
years
than
previously
expected,
granting
more
companies
a
chance
at
securing
billions
in
potential
contracts.

“This
is
a
huge
deal,”
Col.
Doug
Pentecost,
the
deputy
program
executive
officer
of
the
U.S.
Space
Force’s
Space
Systems
Command,
told
reporters
during
a
briefing
this
week.

Earlier
this
year
the
Space
Force
kicked
off
the
process
to
buy
five
years’
worth
of
launches,
under
a
lucrative
program
known
as
National
Security
Space
Launch
(NSSL)
Phase
3.
Now
it’s
boosting
the
scale.

The
U.S.
sees
a
rising
impetus
to
improve
its
military
capabilities
in
space,
spurring
the
need
to
almost
triple
the
number
of
launches
in
Phase
3
that
it
bought
in
Phase
2
in
2020.

“That
just
blows
my
mind,”
Pentecost
said.
“We
had
only
estimated
36
missions
in
Phase
2.
For
Phase
3,
we’re
estimating
90
missions.”

In
February,
Space
Force
outlined
a

“mutual
fund”
strategy
to
buying
launches
from
companies.
It
split
NSSL
Phase
3
into
two
groups.
Lane
1
is
the
new
approach,
with
lower
requirements
and
a
more
flexible
bidding
process
that
allows
companies
to
compete
as
rockets
debut
over
the
coming
years.
Lane
2
represents
the
existing
approach,
with
the
Space
Force
planning
to
select
a
set
number
of
companies
for
missions
that
meet
the
most
demanding
requirements.

Pentecost
said
Space
Force
hosted
an
industry
day
in
February
to
go
over
the
program’s
details
and
had
22
companies
show
up.
Since
then,
Space
Force
made
a
number
of
adjustments
to
Phase
3.
It
has
added
more
missions,
introduced
a
price
cap,
expanded
Lane
2,
and
has
set
an
annual
schedule
for
mission
assignments.

The
government
weighs
bids
by
a
company’s
“Total
Evaluated
Price”
per
launch.
That’s
split
into
“Launch
Service,”
meaning
how
much
it
costs
to
build
and
launch
a
rocket,
and
the
“Launch
Service
Support,”
which
covers
special
requirements
the
military
may
have
for
launch.
The
Launch
Service
Support
amount
is
capped
at
$100
million
per
year
per
company.

“We
implemented
some
cost-constraining
tools
so
that
we
don’t
balloon.
We
don’t
want
[a
situation
where]
everybody
gets
a
mission
—
you
get
a
mission,
you
get
a
mission,
you
get
a
mission
—
because
then
there’s
no
real
competition,”
Pentecost
said.

“We
do
think
that
all
of
our
industry
partners
want
to
be
the
number
one
guy,
so
we
think
that
will
provide
competitive
pricing
to
keep
our
costs
down,”
Pentecost
added.

While
Lane
1
is
expected
to
draw
the
largest
number
of
bids
and
award
30
missions,
Lane
2
is
the
big
show.

With
Lane
2,
Space
Force
gives
out
the
most
valuable
contracts
to
launch
national
security
satellites
with
the
highest
stakes. 

“These
are
the
ones
that
are
a
$1
billion
[satellite]
payload
going
to
unique
orbits,”
Pentecost
said.

Not
only
has
Lane
2
seen
an
increase
in
how
many
missions
are
up
for
grabs
—
currently
estimated
at
58
launches,
up
from
39
in
February
—
but
Space
Force
also
made
the
decision
to
expand
the
available
slots
for
eventual
awards
to
three
companies,
instead
of
limiting
it
to
two.

Elon
Musk’s
SpaceX
and
United
Launch
Alliance,
the
joint
venture
of


Boeing and


Lockheed
Martin,
were
assumed
to
be
the
two
leading
contenders
for
Lane
2,
but
now
there’s
a
door
open
for
another
company
like

Jeff
Bezos’
Blue
Origin.

Space
Force
will
assign
60%
and
40%
of
51
missions
to
the
top
two
bidders,
respectively,
and
the
remaining
seven
launches
will
go
to
the
third-place
bidder. 

Regardless
of
where
a
company
ranks,
it
must
demonstrate
that
it
can
meet
all
the
Lane
2
requirements,
which
include
having
launch
sites
on
both
the
east
coast
and
west
coast,
and
the
ability
to
hit
nine
“reference”
orbits
with
high
accuracy
several
of
which
are
much
further
from
Earth
than
the
low
Earth
orbit
requirement
of
Lane
1.

Asked
by
CNBC
how
many
companies
are
developing
rockets
that
can
meet
those
requirements
by
the
deadline
for
launches,
a
Space
Force
spokesperson
declined
to
specify,
saying
the
military
is
“tracking
several”
that
are
“expanding
their
launch
capabilities
into
most
of
these
orbits.”

“We’re
hoping
that
it’s
not
just
ULA,
SpaceX
and
Blue
Origin
competing
for
that,
as
there
are
others
who
have
messaged
interest
in
the
past,”
Col.
Chad
Melone,
the
chief
of
Space
Systems
Command’s
Launch
Procurement
and
Integration
division,
said
during
the
briefing.

Space
Force
is
introducing
an
annual
Oct.
1
deadline
for
assigning
missions
to
companies
that
have
won
a
contract.

Pentecost
explained
the
first
assignments
are
up
for
grabs
in
October
2025,
but
noted
contracts
don’t
guarantee
assignments,
which
protects
Space
Force
from
delays
companies
may
have
in
developing
and
flying
rockets.

“You
could
actually
have
won
the
contract,
that
you’ve
got
this
great
plan
on
how
you’re
going
to
be
flying
by
[fiscal
year]
2027.
But
since
you’re
not
flying
yet,
and
I
have
a
satellite
that
needs
to
fly
in
two
years,
we
will
not
give
you
that
mission
—
we
will
move
it
to
the
other
guy,”
Pentecost
said.

Space
Force
aims
to
finalize
its
request
for
bidders
by
September
and
then
have
all
the
proposals
in
by
December,
to
then
award
the
contracts
in
October
2024.

Space
Force
officials
said
a
big
driver
of
that
push
is
to
“guarantee
capacity,”
as
there
are
“a
ton
of
other
companies”
trying
to
buy
launches
for
satellites
and
Space
Force
needs
to
lock
down
its
orders.

“We
wanted
to
make
sure
that
we
essentially
hedged
against
the
launch
scarcity
that
could
happen
because,
if
there’s
a
very
large
demand
for
launch
and
everyone
is
[buying],
prices
could
be
very
high,”
Melone
said.

But
despite
that
fear,
Pentecost
said
2026
“seems
to
be
the
sweet
spot”
when
a
number
of
companies’
rockets
will
be
done
with
development
and
ready
to
fly.
And
companies
that
stay
on
track
will
have
the
upper
hand
in
NSSL
Phase
3.

“If
you’re
flying
before
that,
or
if
your
schedule
is
showing
that
you’re
going
to
be
flying
before
that,
you
will
get
significant
strengths,
which
will
put
you
in
a
better
position
to
win
the
best
provider
or
second
best
in
this
competition,”
Pentecost
said.