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Air Force insists launch competition must stay on schedule

Air Force insists launch competition must stay on schedule

The solicitation for the Launch Service Procurement competition is now on track to be released this month, said Col. Robert Bongiovi, director of the Launch Systems Enterprise Directorate.
WASHINGTON — The Air Force is poised to solicit proposals this month for national security launch services and select two providers in 2020. A call for proposals was expected to be released March 29 but was put on hold amid criticism that the Air Force was narrowing the playing field too soon.
The solicitation known as the Phase 2 Launch Service Procurement (LSP) is now on track to be released this month, Col. Robert Bongiovi, director of the Launch Systems Enterprise Directorate at the Air Force Space and Missile Systems Center, told SpaceNews.
The request for proposals (RFP) will move forward despite objections raised by Blue Origin, a new player in the national security launch market. The company has argued that the Air Force is rushing to select two providers to split national security launches 60/40 between 2022 and 2026 and that the schedule gives an unfair advantage to more established players.
During an interview April 11 at the Space Symposium in Colorado Springs, Bongiovi said the Air Force has listened to companies’ concerns and is ready to move on with the final RFP. “We just did two rounds of draft RFPs. We got 1,500 comments. We met with providers one-on-one to really understand their concerns,” he said.
The field of competitors includes Blue Origin, United Launch Alliance, Northrop Grumman and SpaceX. The first three companies in October were awarded $2.3 billion in so-called Launch Service Agreement (LSA) funding to develop next-generation rockets and the infrastructure to support national security missions. SpaceX did not receive an LSA contract but is still expected to compete for the LSP award — although the company’s congressional supporters have warned that SpaceX might sit out the competition unless it too receives LSA funding.
Bongiovi said the final RFP has been updated to address many of the industry’s concerns. “As with any RFP this size, we went through a couple of independent reviews,” he said. “We’ve got a much better product because of these reviews. I’m really satisfied with where this RFP is,” Bongiovi insisted. “We’re acquisition experts and we work through these things to make sure we get it right before we release it.”
The strategy for this procurement has been carefully crafted, he said. It is “still the same as what we’ve had from day one. It started when we realized that we were no longer going to use the Russian engine,” Bongiovi said. That was in 2015, when Congress passed a law that set a 2022 deadline for the Air Force to phase out ULA’s Atlas 5 rocket which is powered by the Russian RD-180 engine. “The first thing we did was invest in technology maturation. We’ve invested in rocket propulsion systems since the beginning of 2016.”
Every competitor has shown progress in developing their systems, Bongiovi said. “We have a solid base of launch systems out there,” he said.
The schedule is not being rushed, he said, and was designed so the Air Force can have new vehicles ready for 2022. “Our original plan had us at one point awarding the procurement of launch services at the same time that we were going to award the LSA,” said Bongiovi. The Air Force later decided to separate the two to “buy us some more time,” he said. The RPF has to go out so vendors can be selected next spring.
“By next spring we expect most, if not all, of these systems would have gone through critical design review,” he said. “And I think we have systems that are going to be mature enough that we can make a reasonable determination next spring on who we want to have as our national security space launch providers starting in 2022.”
Blue Origin, ULA and Northrop Grumman are developing new vehicles and none will fly until 2021. But the Air Force has to select its two suppliers in 2020 because that will ensure both companies have enough time to get their vehicles ready to start launching payloads in 2022, said Bongiovi. It is not unprecedented for the Air Force to select vehicles that have not yet flown. In the original Evolved Expendable Launch Vehicle program in the 1990s, “we absolutely chose our path forward before the vehicles’ first flight,” Bongiovi said. National security satellites are “large and very complex. Some require at least a two-year timeframe to integrate and launch,” he added. “If we wait until after the first flight [to select providers] that could mean an additional two years of flying Atlases with the Russian engines.”
SpaceX concerns
Despite not winning LSA funds, “I think SpaceX is competitive going forward,” said Bongiovi. “We have a lot of business with them … but it’s their choice how they respond to the RFP.”
The company has not publicly said whether it will enter the LSP competition and declined to comment for this article. An industry source said SpaceX behind the scenes has pressed the case that it has been put in a competitive disadvantage not only because it didn’t get LSA money but also because the Air Force will not select the two LSP providers based on price alone, something that would give SpaceX an edge. The industry source said the way the Air Force laid out the selection criteria — a combination of technical performance, operational readiness, business case and price — gives the government a lot of discretion to determine who provides the “best value,” a process that commercial players like SpaceX and Blue Origin view as favoring the most established provider, ULA.
Bongiovi said price is one of many factors and sub-factors that will be weighed. “Price is never not part of this decision.” It will be part of a tradeoff analysis, he said. “We have to see the proposals and do the evaluation to understand how much of a factor it will be.”
The industry source said SpaceX is weighing its options but is not expected to pursue legal action the way it did in 2014 to compete in the EELV program. It would be shocking if SpaceX chose not to bid for Phase 2 because they have the most mature rockets in the field. Although the company would not have to pay for vehicle development to compete for Phase 2, it would still have to self-fund the infrastructure needed to meet national security launch requirements, such as a vertical payload integration facility on the East Coast. This has been a sore issue for SpaceX as its three competitors are all being subsidized by the Air Force to build that infrastructure.
SpaceX also is challenging the narrative pushed by Blue Origin that the LSP schedule favors both national security launch incumbents, ULA and SpaceX, the source said. “Blue Origin is pushing this narrative forward because they’re trying to make this seem like it’s a competition that’s unfair to them,” the source said, while SpaceX sees itself in an unfair position after the Air Force awarded billions of LSA dollars to its competitors.
A new way to contract for launches
One of the more puzzling aspects of the LSP is how the Air Force plans to award launches once the two providers are selected in 2020. Competitors are not bidding for specific missions but instead have to propose vehicles that can meet requirements to fly to nine reference orbits and carry different payload classes.
“It’s called a requirements contract,” said Bongiovi. This is different than the previous EELV contracts that were awarded for specific missions. In the National Security Space Launch program, the two providers selected for Phase 2 will be assigned the specific missions on a yearly basis over the five year period.
“I call it a batting order,” Bongiovi said.
After the Air Force picks the two winners, it will decide who gets 60% who gets 40% of the missions over the five-year period but will assign specific rockets on a yearly basis depending on the required missions. That gives the government more flexibility to manage the manifest, said Bongiovi.
This approach would save the government the cost of making contractual changes if it needs to change the timing of the launches as it often happens when satellites are not ready. In 2020, for instance, the Air Force will look at how many missions will be needed for 2022 and decide which of the providers gets what missions that particular year. And that process will be repeated annually to even out the 60/40 split over the five year period.
Providers will not know which missions they get until the Air Force issues the contracts on an annual basis, he said. One of the lessons from the EELV program is that the government needs more flexibility, Bongiovi said. “Some satellites were launched pretty close to when we expected them to but some satellites didn’t,” he said. “The last one we ordered in 1998 was launched in 2016. That doesn’t help industry. That doesn’t help us.”
The launch business “is going to be a little bit more dynamic than it was in the past,” said Bongiovi. “We can’t predict exactly what’s going to be ready or how is the department going to prioritize these launches,” he said. The Air Force wants to be able to adjust the manifest accordingly while minimizing contractual headaches.
As far as vendors having enough business predictability and time to prepare, that was taken into account too, said Bongiovi. One of them will know upfront it will get 60 percent of the missions. The other will know it will get 40 percent. And once a plan is decided for each year, the vendors will know the order of the missions.
There is, of course, no guarantee that everything will work out as planned, he cautioned. “No matter what the contract says, you succeed and fail together with your industry partners. In this case, it will require us to be in good communication with both industry partners and work with them,” he said. “A contract is a two-way street, and a requirements contract means that when we have the requirement, we have to follow the terms of the contract.”
The five-year deal is estimated to average about five missions a year but the Air Force is not guaranteeing a specific number of launches, said Bongiovi. Budgets are revised year to year and priorities can change, he said. The president puts out a five-year budget plan “but I don’t think that’s necessarily an accurate forecast of what we’re going to end up launching in the five year period.”
Contract awards will be made so that vendors have sufficient time to prepare, said Bongiovi. “They have a supply chain that they have to manage. There are components that have long leads,” he said. The five year commitment they get from the Air Force should allow them to have a “fairly stable base,” he said. “That is certainty. It may not be as much certainty as if I say I’m going to buy five launches a year every year,” he added. “That’s how we constructed this whole program so the government doesn’t have to manage the ins and outs of hardware. So they [the vendors] can handle that through their business processes, through their logistics processes.” Launch providers have to deal with the ups and downs of commercial sales and the LSP gives them stability “even without giving them a number, in my opinion.”
Mixed views from the industry
Air Force insists launch competition must stay on schedule

The forthcoming release of the Air Force RPF for launch services was a hot topic last week at the Space Symposium, where senior executives weighed in on the competition.
Much of the attention was on Blue Origin’s CEO Bob Smith. During a news conference April 8, Smith said the company looks forward to the competition but expressed concern that the schedule might not allow enough time to mature its New Glenn rocket. Downselecting vendors in 2020 “just seems premature,” he said. “We can probably delay and still have the same level of competition, perhaps even better insight,” Smith said. “These are big one-way door decisions that we have for the nation and what infrastructure will be put down and how we put that down is important,” he said. “And so you’d think more time would actually be beneficial … and would be better for the country.” If the Air Force sticks with the schedule, however, “We’ll be glad to compete in LSP,” he said. The Air Force requires all three companies that received LSA funds to bid for the Phase 2 award. The losers of Phase 2 will have their LSA agreements terminated.
Air Force insists launch competition must stay on schedule

United Launch Alliance CEO Tory Bruno said he agrees with the Air Force that postponing the release of the RFP or the downselect would risk not being able to meet the 2022 congressional deadline to stop buying Atlas 5 launches. ULA is developing the Vulcan Centaur, powered by Blue Origin’s BE-4 engine.
The government started co-investing with industry in new propulsion systems and rockets five years ago, Bruno said. “We are very confident that we will be flying [Vulcan Centaur] in 2021,” he said. The schedule the Air Force laid out was “very thoughtfully put together and is the fastest path to end the U.S. dependency on the Russian rocket engine so let’s get on with it, let’s get it done,” Bruno said. “That’s where I’m at.”
Air Force insists launch competition must stay on schedule

Kent Rominger, Northrop Grumman’s vice president of OmegA capture, said April 8 at the Space Symposium that company completely agrees with the schedule put forth by the Air Force and in fact would not mind if it were accelerated.
He said Northrop can “compete with these new space companies that are really leaning forward and have changed the world when it comes to affordability.” Although the solid-fuel OmegA is a brand new design, it uses existing hardware and avionics that Northrop Grumman grabbed from its other vehicles.
“By 2022, the Air Force has got to have systems to replace what they’re relying on today,” he said. On whether the schedule favors some players versus others, Rominger said, “honestly, that’s competition.” If anything, “I want to see it accelerate rather than delayed,” he added. The December 2022 deadline to stop buying the RD-180 is “rapidly approaching,” he said, “so we’re big proponents of keeping the program on schedule.”




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