The Defense Department cited the 36 core “block buy” contract award to incumbent United Launch Alliance (ULA) for a 4.3 percent drop in program costs in the Air Force’s Evolved Expendable Launch Vehicle (EELV) program, which assures the federal government access to space.
DoD said in its 2013 Selected Acquisition Report (SAR) summary released Thursday EELV program costs decreased $3.1 billion from $70.7 billion to $67.6 billion due primarily to savings realized in the negotiation, and award, of the new 2013-2017 Phase I contract. DoD also cited revised cost assumptions based on the negotiated contract and net decreases from a change in launch vehicle configuration requirements. These decreases were partially offset, DoD said, by a quantity increase of 11 launch services from 151 to 162.
Under Secretary of Defense Frank Kendall in late 2012 authorized the Air Force to no-compete a “block buy” of 36 cores to ULA over a span of five years while competing up to 14 cores to other companies. Kendall’s memo said, at the time, the Air Force could sole-source those 14 cores to ULA if competition was not viable at the time of need (Defense Daily; Dec. 6, 2012).
Since that memorandum, the Air Force has decreased from 14 to seven, but possibly eight, the number of launches it plans to compete during fiscal years 2015 and 2017, citing a reduced need for launches due to extended health of its Global Positioning System (GPS) fleet of satellites. The Air Force insists it still plans on competing these launches, just later than originally planned (Defense Daily, April 2).
This upsets pro-competition lawmakers who want to ensure the Air Force competes national security space launches to help drive down costs. One of those lawmakers, Senate Appropriations defense subcommittee Chairman Richard Durbin (D-Ill.), said in a March hearing he’d help ensure the Air Force is not reducing competition for EELV but rather delaying. Durbin spokeswoman Maria McElwain said Monday additional congressional oversight and future competition, in addition to the “block buy,” have contributed to cost savings in the program. McElwain said while the cost reductions are welcome, Durbin would continue to fight to infuse competition in the EELV program.
“Although last week’s report is good news, and shows improvements in reducing costs associated with the EELV program, Senator Durbin will continue seeking additional savings to this program through better acquisition practices,” McElwain said.
Space Exploration Technologies Corp. (SpaceX) seems to be leading the pack among possible new entrants for national security launches. The company had a successful launch for a NASA mission Friday that could count toward certification. SpaceX must meet rigorous certification requirements and perform at least three successful flights of a common launch vehicle configuration for the company to be considered for launching national security payloads. The Air Force said in late February SpaceX’s Sept. 29 launch would count toward certification. The Air Force also said in late February it was still assessing the company’s Dec. 3 and Jan. 6 launches for certification. The service did not respond to requests for comment by press time.
ULA is a joint venture of Lockheed Martin [LMT] and Boeing [BA].