Why NASA Picked SpaceX to Land Humans on the…

The Background

Humans have not traveled beyond Earth orbit since the Apollo program ended in 1972. NASA has officially been trying to change that since 2004, when President George W. Bush announced what became the agency’s back-to-the-Moon Constellation program.

In 2010, the Obama administration canceled Constellation, but two key pieces of the program survived: the Orion crew capsule and a rocket that became what is now the Space Launch System, or SLS. Both vehicles are being developed using classic “cost-plus” contracting, where NASA pays for the full cost of development, even if costs rise far above initial estimates.

NASA’s Artemis program will use the SLS to blast astronauts to lunar orbit aboard Orion, where they will meet up with a previously-emplaced lunar lander to travel to the surface and back. Orion in the future will also dock with the Gateway, a small space station in lunar orbit. From there, astronauts can conduct science and transfer to lunar landers.

Rather than building a lunar lander in-house the way it does with SLS and Orion, NASA opted to pay space companies a fixed price to build their own lunar landers, which the companies will own. NASA in turn can purchase ongoing landing services from these providers. The total cost to NASA is therefore fixed—any cost overruns are shouldered by the companies.

Conversely, if companies can deliver their landers for less than the cost of the contract, the company retains the difference as a profit. NASA successfully deployed this model to ferry crews and cargo to the ISS.

Encouraged by a business-friendly White House that pushed for a 2024 Moon landing, NASA expanded its use of public-private partnerships beyond low-Earth orbit, creating new programs for commercial lunar payload deliveries of scientific instrumentation and technology demonstration missions. Last year, the agency funded SpaceX, Blue Origin, and Dynetics to develop human-ready Moon lander concepts for Artemis, and proposed to spend nearly $21 billion over the next five years to support multiple human landing vehicles.

But despite strong White House support, Congress last year provided only $850 million for lunar landers—far below the $3.4 billion NASA requested. Faced with a funding shortfall, NASA delayed its decision to select which companies would receive funding for continued development of their moon landers.

That is, until last week, when NASA announced they would go all-in on Starship.

NASA would have probably liked to pick more than one provider for redundancy. But with little funds to go on and the prospect of seeing the Moon landings drag out for many more years, they picked the cheapest—and most likely to succeed—option: SpaceX.

Updated: April 20, 2021 — 8:19 pm

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