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Air Force Budget Reveals How Much SpaceX Undercuts Launch Prices (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: In 2014, the U.S. Government Accountability Office issued a report on cost estimates for the U.S. Air Force's program to launch national security payloads, which at the time consisted of a fleet of rockets maintained and flown entirely by United Launch Alliance (ULA). The report was critical of the non-transparent nature of ULA's launch prices and noted that the government "lacked sufficient knowledge to negotiate fair and reasonable launch prices" with the monopoly. At around the same time, the new space rocket company SpaceX began to aggressively pursue the opportunity to launch national security payloads for the government. SpaceX claimed to offer a substantially lower price for delivering satellites into various orbits around Earth. But because of the lack of transparency, comparing prices was difficult. The Air Force recently released budget estimates for fiscal year 2018, and these include a run out into the early 2020s. For these years, the budget combines the fixed price rocket and ELC contract costs into a single budget line. (See page 109 of this document). They are strikingly high. According to the Air Force estimate, the "unit cost" of a single rocket launch in fiscal year 2020 is $422 million, and $424 million for a year later. SpaceX sells basic commercial launches of its Falcon 9 rocket for about $65 million. But, for military launches, there are additional range costs and service contracts that add tens of millions of dollars to the total price. It therefore seems possible that SpaceX is taking a loss or launching at little or no profit to undercut its rival and gain market share in the high-volume military launch market. Elon Musk retweeted the article, adding "$300M cost diff between SpaceX and Boeing/Lockheed exceeds avg value of satellite, so flying with SpaceX means satellite is basically free."
The $422m figure is for a Delta Heavy launch, which makes the comparison with the Falcon 9 laughable - it should be compared with a Falcon Heavy launch, which SpaceX ain't giving launch cost figures for yet.
Also, Musks quote about the $300m price difference being the cost of the satellite is bang on, for commercial launches - military satellites are often into the billions of dollars, and as such are less price sensitive on the launch and more success sensitive. Delta Iv Heavy is at 8 launches with no failures (one partial success) and Atlas V is at 71 launches with no failures (one partial success).
SpaceX are getting there with reliability, but Musk needs to learn to STFU when it comes to price sensitivity because for some customers thats not the driving factor.
Actually, the ULA does list prices for the Atlas V launches,
go to https://www.rocketbuilder.com/start/configure and you can spec out an Atlas V for a given weight to orbit and compare it to what a Falcon 9 is listed at.
Just ignore the 'funny money' "ULA added value" "discount" they list.
An Atlas V starts at $109M for 21700 lbs to LEO (~$5K/lb) and goes up to $157M for 41476 lbs to LEO (~3.5K/lb)
meanwhile a Falcon 9 is listed at $62m for 50,265 lbs to LEO ($1.2K/lb) and the Falcon Heavy $90m for 140,660 lbs to LEO (~$700/lb)
http://www.spacex.com/about/capabilities
to GTO, The Atlas is
Atlas V $109M 3500lb ~$31K/lb
Atlas V $153M 6695lb ~$23K/lb
Falcon 9 $62M 18300lb ~$3.3K/lb
Falcon H $90M 58860lb ~$1.5K/lb
note these payloads are for fully expendable Falcons, which may be more expensive than one where they can recover parts.
so if you are going to Geosync orbit, SpaceX is about 1/10 the cost of ULA