ESA ousts Airbus as space station prime, appoints itself instead

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PARIS — The European Space Agency has dismissed Airbus Defence and Space as prime contractor for operations of Europe’s share of the International Space Station, opting to perform much of the Airbus work itself, European government and industry official said.

The decision, which reverses more than a decade-long trend of commercializing space station functions, was made following ESA assurances that it could do much of what Airbus has done without adding personnel or incurring other costs, officials said.

Under the new space station operations scheme, ESA split the former Airbus contract into three pieces:

  • One for Airbus, which will continue with a much-reduced work package.
  • One for Altec of Turin, Italy, a joint venture between the Italian Space Agency and Thales Alenia Space Italy.
  • One with the German Aerospace Center, DLR, which has a station operations center in Oberpfaffenhofen.

ESA and Airbus in December signed a contract valued at 88 million euros ($96 million) to cover 2.5 years of Airbus work. The Altec contract was valued at 25 million euros, and DLR’s contract was valued at 19 million euros.

Added together, the three contracts total 132 million euros — a 32 percent reduction from the previous Airbus contract, for 195 million euros, which was signed in December 2013 to cover two years of station operations.

ESA officials declined to comment in detail on why the agency decided to reverse course in favor of a larger agency role in the station’s day-to-day management.

“Cost control,” the agency said in response to SpaceNews inquiries. “The previous contract with [Airbus Defence and Space] covered some additional positions like sustaining engineering, which are now covered in a different contract. We managed to improve efficiency, with overall cost reductions, while keeping the spectrum of functions.”

Bart Reijnen, head of orbital systems and space exploration at Airbus, said the company fully understood ESA governments’ demand that space station costs be reduced, and had been ready to work with ESA on ways to accomplish that goal.

“Airbus and ESA agreed that further cost reductions in [space station] operations were highly needed,” Reijnen said in a Jan. 21 interview. “ESA took the decision to split the contract because they were of the opinion that this would be cheaper for the overall system.

“However: They made a big assumption and told the member states that ESA would take on this additional role with the same team, and the same amount of people,” Reijnen said. “If this assumption is not confirmed, then of course costs will not go down.”

One European government official said ESA’s space station directorate is being reorganized in 2016 to include robotic exploration, which previously was inside the agency’s science directorate.

“There might have been some synergies that would have resulted in layoffs in the new organization, and ESA may be avoiding layoffs by taking on the Airbus work,” this official said. “Certainly it’s true that bringing station operations back in house seems to be moving against global trends, which are based on the idea that the private sector can do these kinds of things more efficiently.”

ESA had been signing space station operations contracts with Airbus in two-year increments. In December 2011, the contract was valued at 233 million euros for two years. The December 2013 contract for 195 million euros included a statement by both ESA and Airbus that the company had succeeded in reducing costs by 30 percent between 2011 and 2014, as ESA had asked.

The Airbus contract included astronaut training, spare parts procurement for Europe’s Columbus space station laboratory, payload experiment design assistance, ground station maintenance and space station communications.

Airbus had led a team of 40 companies in 10 nations. DLR and Altec had been subcontractors under Airbus. Part of the cost reduction came when the fifth and final Automated Transfer Vehicle (ATV) cargo vehicle was deorbited in July 2015 after a six-month visit.

ESA’s space station budget as a partner alongside the United States, Russia, Japan and Canada is divided into two parts.

The first, which was largely covered by the Airbus contract, deals with preparing, launching and conducting experiments to Europe’s Columbus space station laboratory and reserving astronaut time for those experiments that need astronaut support.

The second budget line pays Europe’s 8.3 percent share of the common operating costs shared with the United States, Japan and Canada. Russia is responsible for its own segment. ESA’s 8.3 percent share was valued at about 150 million euros per year.

ESA and NASA, the station’s general contractor, agreed that ESA’s payments would be made in kind, through launches of the five ATV freighters aboard European Ariane 5 rockets. The fifth and last ATV covered ESA’s obligations until the end of 2017.

ESA has agreed to remain in the station partnership at least until 2020. The three final years’ operating-cost obligations to NASA are being covered by ESA’s developing the service module for NASA’s Orion crew transport vehicle.

ESA and NASA have agreed that ESA will provide one Orion service module, and spare parts for a second, to meet ESA’s common operating cost debt through 2020.

Meeting in December 2014, ESA governments ordered the agency to make further cuts to space station operations. These governments are scheduled to meet in December of this year to determine whether to remain in the space station partnership until at least 2024. All the other partners have made this decision.

ESA and NASA officials have said they assume that Europe will continue to provide Orion service modules beyond the first one. But no formal agreement has been concluded.