WASHINGTON — Boeing is willing to build a crew capsule for NASA on a commercial fixed-price basis but is troubled by the agency’s plans to continue funding development of the Orion Crew Exploration Vehicle to serve as a space station lifeboat, according to a Boeing executive.

“With the recent announcement of a crew rescue vehicle as part of Orion, we do now recognize that we would have a cost-plus, government-funded capsule competing against a commercially fixed-price capsule,” Jayne Schnaars, Boeing’s vice president of business development for space exploration, said during a presentation at the Women in Aerospace conference here May 18. “So we’re working with NASA to say, ‘We want this business, we know we can do it, help us.’”

After announcing in February that Orion and the rest of the Constellation program would be canceled in favor of outsourcing routine crew transportation to commercial operators, the White House decided in April to have NASA fund completion of a stripped-down Orion capsule that would launch to the international space station unmanned to serve as an escape craft.

Lockheed Martin, which beat Boeing and its teammate Northrop Grumman in 2006 for an Orion prime contract worth an initial $3.9 billion, welcomed the news as a partial reprieve for the project. But to Boeing, continued NASA funding of an Orion capsule that would need only a launch abort system to start launching crews would add substantial risk to a business case Schnaars said will be a struggle to close.

“No matter how many folks say, ‘I can build this, I can launch it, it’s going to work,’ we have to make sure it makes business sense, and right now there’s significant challenges there,” she said.

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President Barack Obama’s plan to scrap most of Constellation threatens a pair of contracts worth $800 million that Boeing won in 2007 to develop the upper stage and instrument unit for the Ares 1 rocket. Schnaars, however, said Boeing sees a big upside to the president’s pledge to spend roughly $100 billion on NASA over the next five years — some $6 billion of which has been identified for the commercial crew initiative.

Boeing currently stands to receive $18 million from NASA this year to get started on preliminary development of a crew capsule that could launch on a variety of rockets, including United Launch Alliance’s Atlas 5 and Space Exploration Technologies’ Falcon 9. The seed money was one of five such awards NASA made in February under the Commercial Crew Development program the agency started with $50 million from the American Recovery and Reinvestment Act of 2009.

Boeing is working on its capsule design with Bigelow Aerospace, a Las Vegas company in dire need of affordable crew transportation for the inflatable space modules it is building with public- and private-sector customers in mind.

While Bigelow and others are bullish on space tourism, Schnaars sees NASA as the primary near-term customer. “We do believe NASA will be our anchor tenant, and internally my boss Brewster Shaw has briefed to the [NASA Advisory Council] that with NASA as our foundation we want to become the Boeing Commercial Aircraft of commercial space exploration,” she said. “Things that are of concern to us would be the commercial business case. [It’s] very hard to close the business case when there’s two launches a year for five years. That would be 10 launches. If there are two contractors, that would be five. This is tough stuff. We need much larger numbers.”

Schnaars said Boeing would prefer to see NASA focus Orion’s continued development on deep space missions such as the five-month asteroid sortie Obama said last month the United States would embark upon in 2025.

NASA Administrator Charles Bolden, talking to reporters May 19 at the Federal Aviation Administration’s Commercial Space Transportation Advisory Committee meeting, said NASA is still wrestling with how to redirect the Orion program to produce a crew lifeboat design that could evolve to take on deep space missions. “You would ideally like to have the outer mold line look the same 30 years from now as it looks today, like a Soyuz, but inside be dramatically different because it’s got open architecture in terms of the software for the flight design system, it’s using different navigation systems because 10 years from now the technology that we develop will be dramatically different, miniaturized, it may have a different propulsion mechanism on it,” he said. “Who knows?”

Bolden said the Orion lifeboat called for by the president is not intended to compete with NASA’s commercial crew initiative. However, Bolden also said industry is free to use the Orion design as the basis for a commercial crew offering.

“If Boeing and Lockheed or ATK or somebody decides, ‘Hey, I like Orion, we want to take that basic design and we want to modify it for our entry into the next round of competition for commercial crew, I shouldn’t deprive them of their ability to do that,” he told reporters.

Neither Lockheed Martin nor Alliant Techsystems (ATK) — the Minneapolis-based prime contractor for the Ares 1 main stage — has expressed much enthusiasm for NASA’s commercial crew initiative since it threatens the cost-plus Constellation contracts both companies hope to retain.

Ken Reightler, vice president for NASA program integration at Denver-based Lockheed Martin Space Systems, said it was too soon for other companies to worry about an Orion lifeboat skewing the competition for NASA’s commercial crew business.

“We’re still trying to understand what NASA wants for a crew rescue vehicle, and we really haven’t been given too much information and understanding of that,” Reightler told Space News following a May 20 panel discussion here on NASA human rating requirements. “Until we have a better understanding of what any kinds of changes to our contract would be, it would be premature for any other company to make conclusions about how that might affect any other competition.”

Still, Reightler said, if NASA asks for an Orion lifeboat that retains much of the capsule’s current design, it would not be that hard for Lockheed Martin to adapt the vehicle to carry crew into orbit.

“It really depends on where NASA takes the program and whether we go in a totally different direction that is very limited and very restricted with very limited capability, or whether we’re able to hold onto a vehicle that looks very much like it does today,” he said. “If we are, I think it would be a pretty easy job to be able to then get back on the track of having a vehicle that could supply support for crew exploration. If we are told to go a completely different direction than where we’re headed now, it might be a little more difficult.”

Speaking at the same event as Reightler, Brewster Shaw, vice president and general manager of Houston-based Boeing Space Exploration, echoed Schnaar’s concerns about building a strong business case for commercial crew.

“I do have to go to Chicago and convince [Boeing chief executive James] McNerney that there’s a reasonable business case with acceptable risk to Boeing’s bottom line and Boeing’s reputation and its brand before he’ll allow me to enter into this kind of agreement with the government,” he said during his presentation. “But I’m ever hopeful.”