SpaceX, Northrop Grumman Insist on Strong Oversight of ULA

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  Space News Business

SpaceX, Northrop Grumman Insist on Strong Oversight of ULA

By JEREMY SINGER
Space News Staff Writer
posted: 14 November 2006
03:12 pm ET


BOSTON — Two U.S. companies worried that their businesses could be adversely affected by the pending merger of Boeing and Lockheed Martin’s launch services operations have again asked the U.S. Federal Trade Commission (FTC) to ensure they are protected when the deal goes into effect.

The FTC voted to approve the merger Oct. 3 and imposed a consent degree that appeared to address some of the issues raised by Northrop Grumman Corp. and Space Exploration Technologies (SpaceX) during the commission’s review of the deal.

The consent order was subject to public comment for a period that ended Nov. 1. During that time Northrop Grumman and Space X reiterated their separate concerns and asked the FTC to ensure that they are addressed.

Northrop Grumman spokesman Randy Belote said Northrop’s most recent filing was intended to help influence the U.S. government’s oversight of the joint venture, rather than stop it from taking place.

U.S. law requires that government satellites be launched by domestic providers. When the merger is completed, United Lauch Alliance (ULA) will be the only launcher currently capable of launching large government satellites. Because satellite manufacturers have to share proprietary data about their spacecraft with the launch provider to ensure the satellite is not damaged during launch, Northrop Grumman is concerned that sensitive information about its satellites not be passed on by ULA officials to their former colleagues at Boeing or Lockheed Martin.

The most recent Northrop Grumman comments filed with the FTC were signed by Stephen Yates, the company’s vice president and deputy general counsel. In that filing, Yates said the consent degree does not go far enough to ensure that proprietary information about Northrop Grumman satellites used by United Launch Alliance to integrate the satellites onto its rockets does not leak into the hands of Boeing or Lockheed Martin officials who also build satellites for the government.

Elon Musk, SpaceX chief executive officer, said his company’s comments were intended to reiterate its concerns that the FTC has yet to address “the anti-competitive nature” of ULA.

Musk noted in a Nov. 6 e-mail that under the joint venture, the Pentagon will continue to cover infrastructure costs for United Launch Alliance that it does not provide to other launch companies, and expressed frustration that the Air Force appears to have allocated launches to the joint venture for the next five years without giving SpaceX and others a chance to bid on the business.

SpaceX’s comments, which were signed by Larry Williams, the company’s vice president for government and international affairs, state that the consent degree does not do enough to open the door to competition to ULA’s rockets. SpaceX is marketing the Falcon 9 rocket to national security customers, and describes it as a low-cost alternative to Lockheed Martin’s Atlas 5 and Boeing’s Delta 4 rockets, which today carry the bulk of U.S. military launches.