Blue Origin urging Air Force to postpone launch competition

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COLORADO SPRINGS — Blue Origin wants the U.S. Air Force to wait until 2021 before picking the two companies it intends use for launching critical military satellites in the decade ahead. 

The Air Force, however, aims to solicit proposals this spring and choose its two preferred launch providers in 2020 — perhaps a year or more before the new rockets that the Air Force is fostering at Blue Origin, United Launch Alliance and Northrop Grumman make their first flights. 

All three companies were chosen in October  by the Air Force Space and Missile Systems Center to share $2.3  billion in so-called Launch Service Agreement (LSA) funding to support development of next-generation rockets capable of meeting the military’s satellite launch needs.

The Air Force said last fall that all three LSA winners plus SpaceX would be required to submit new proposals in 2019 if they want to be among the two providers the Air Force intends to select in 2020 to split up to 25 future launch contracts. 

The Air Force intends to call for those proposals in the coming weeks with a solicitation known as the Phase 2 Launch Service Procurement (LSP) that would give Blue Origin  its competitors 60 days to submit bids. 

Blue Origin says the Air Force’s hurry  to select two providers to split 60/40 contracts for up to 25 launches between 2022 and 2026 would forestall competition and give  unfair advantage to United Launch Alliance and SpaceX, the two companies currently launching nearly all U.S. national security satellites. 

“We disagree with the Air Force on the timing of Phase 2,” Brett Alexander, Blue Origin vice president of government sales and strategy, told SpaceNews.

Under Blue Origin’s LSA award, the Air Force agreed to give the company up to $500 million between 2019 and 2024 to help cover the costs of getting the reusable New Glenn heavy-lift rocket and its infrastructure ready to support military launches. 

That funding, however, would be terminated if Blue Origin is not one of the two companies the Air Force selects to split LSP launch contracts potentially worth billions of dollars. 

Alexander said Blue Origin has already invested $2.5 billion in New Glenn’s development, including building factories in Florida and Alabama, but needs the LSA funds for infrastructure investments specific to national security missions.

“We’re doing a commercial heavy-lift vehicle development,” Alexander said. Without LSA funding, the company would not, he said, build a New Glenn vertical integration facility — a requirement for carrying certain military payloads, such as satellites with massive, fragile mirrors. Nor would Blue Origin build a launch site at Vandenberg Air Force Base, California, which due to its location is used for polar launches of little interest to most commercial customers. “Those are things we are not doing commercially,” he said. “We’re doing under LSA what we wouldn’t otherwise do for ourselves.”

ULA and Northrop Grumman are in similar situations, although both won much larger LSA awards than Blue Origin. ULA stands to receive up to $967 million from the Air Force to help with the development of Vulcan Centaur, the successor to Atlas 5, the Air Force’s workhorse rocket. Northrop Grumman is eligible to receive up to $792 million for OmegA, the only solid-fueled rocket in the competition. Blue Origin, ULA and Northrop Grumman all say they are on track to debut their rockets in 2021. SpaceX, which is privately funding development of a new fully reusable Super Heavy rocket and exploration-class Starship second stage, will presumably compete for LSP contracts with its existing Falcon 9 and Falcon Heavy rockets. 

While Blue Origin presses the Air Force to delay the LSP competition, it’s also found allies on Capitol Hill. House Armed Services Committee Chairman Adam Smith (D-Wash.), whose Seattle-area congressional district is home to Blue Origin, asked the Pentagon late last month to put a hold on the release of the so-called Phase 2 LSP solicitation. Air Force officials, however, have said they intend to move ahead. 

Blue Origin, despite its objections to what it considers a premature downselect, says it will be ready to submit its proposal even if the Air Force moves ahead as planned. 

“When it does come time to submit a bid, we’re 100 percent focused on submitting a winning and compelling proposal,” he said. “We have a commercial vehicle that will be flying 12 times a year and can meet national security requirements.”

Meanwhile, New Glenn checked off an important LSA milestone, completing its preliminary design review in December, according to Steve Knowles, New Glenn’s program manager.