Is the space industry moving beyond SpaceX?

Elon Musk is considered by many to be the godfather of private-sector spaceflight, and for a good reason. In January 2015, he revolutionized the space industry. By settling a lawsuit with the U.S. Air Force that effectively opened the aerospace marketplace to competition, Musk and his rocket company SpaceX helped restore free-market principles to the space industry. Nearly four years later, the space industry is thriving and expanding far too quickly for SpaceX to retain its preeminence.

When Musk first entered the spaceflight industry, many industry players viewed SpaceX as “an unrealistic upstart that didn’t appreciate the harsh technical and cost realities of the spaceflight business.” Yet, SpaceX managed to offer some services at a cost of 20 to 30 percent less than its competitors. Distinguishing itself from the pack, Musk’s low-cost model changed the face of the industry and established SpaceX as the leading authority on private spaceflight. But in the free market, there are always new companies looking to supplant the old, and the space industry is no different.

{mosads}The Washington Post recently claimed, “2019 is shaping up to be a stellar year for space exploration.” There’s no doubt that the future of space exploration looks bright. Competition breeds success, and in 2019, there is no shortage of either in the space industry. An abundance of spaceflight companies has cropped up recently, with each looking to make their mark on the industry. Whether it’s Boeing working to develop a ferry to the International Space Station, Virgin Galactic planning to make space tourism a reality, or Rocket Lab attempting to become the “FedEx” of aerospace, each company is competing to produce the best product at the most affordable price.

Unfortunately for Musk, the competitive aerospace landscape he helped create is the very reason why his company is currently struggling. SpaceX, the aerospace industry titan, is being out-competed. Starting in 2020, NASA will pay an additional $400 million for cargo delivery to the International Space Station, mainly due to an astounding 50 percent price increase from one supplier, SpaceX. Such a dramatic price jump is likely to garner attention, and given the large pool of competitors, it wouldn’t be surprising if NASA decided to shop around instead. In fact, that is exactly what the Defense Department has already done.

In 2018, the U.S. Air Force expressed hesitance toward the performance of SpaceX’s reusable rockets, signaling they were concerned about the rockets’ quality. Later that year, the Air Force opted to award its lucrative contracts to Blue Origin, Northrop Grumman Innovation Systems, and United Launch Alliance rather than SpaceX. While this was undoubtedly a blow to SpaceX, it was a win for the Department of Defense, and by extension the American people. Increased competition brings both decreased price and greater quality assurance. And in the costly and dangerous aerospace industry, price and quality are absolutely critical. Competition leads to breakthroughs and efficiencies.

SpaceX’s decline from preeminence is not a net negative; it is merely the free market at work. New and scrappy competitors vying for a spot in the United States aerospace strategy may be the motivation Musk needs to keep his company at or near the forefront of the space exploration industry. Perhaps as a result of the competition, SpaceX will become a leaner, meaner, and more efficient version of itself. Indeed, Musk recently took the necessary steps to do just that. Last week, SpaceX cut its workforce by a substantial 10 percent to “continue delivering for our customers and to succeed in developing interplanetary spacecraft and a global space-based internet.”

{mossecondads}Musk accomplished the incredible feat of revolutionizing space exploration, and he should certainly be recognized for that. Nevertheless, the industry has moved beyond his company. Even Musk would admit that space is much bigger than he is, and we should approach it as such. Through the free market, the space industry has grown and evolved in spectacular and unexpected ways, and we must continue to embrace that approach as we explore the next great frontier.