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Lockheed-Boeing venture says rocket launch costs lower than claimed by rival

By Andrea Shalal

COLORADO SPRINGS Colo. (Reuters) - A joint venture of Lockheed Martin Corp and Boeing Co on Monday said its rocket launch costs were far lower than claimed by its rival, privately-held Space Exploration Technologies, or SpaceX, which is suing the U.S. government for shutting it out of the lucrative rocket launch business.

United Launch Alliance President Michael Gass told reporters at a space conference in Colorado that his company was providing rocket launches to the U.S. Air Force and other customers for an average cost of $225 million per launch, far less than the $460 million amount cited by SpaceX.

He said the price of each lighter-weight rocket launch was around $164 million in a 36-unit block buy that is being challenged by SpaceX. He also said ULA could provide additional lighter-weight launches for under $100 million, about the same price that SpaceX says its rocket launches will cost.

Overall, he said, the 36-launch contract had saved the U.S. government about $4 billion.

SpaceX last month sued the Air Force to protest the award of a multibillion-dollar, non-compete contract to ULA for 36 rocket launches, saying the deal blocked companies like SpaceX from competing for national security launches.

The Air Force says it will allow SpaceX to compete for a small number of rocket launch orders once its Falcon 9 rocket is certified to launch military satellites into space.

Gass said there were "a lot of rumors and innuendo" about the cost of his company's rocket launch services, but the $460 million cost estimate was inaccurate and actually included some funding being used to certify the new SpaceX rocket.

SpaceX Falcon 9 rockets already fly cargo ships to the International Space Station, a $100 billion research laboratory that flies about 260 miles (418 km) above Earth. The Falcon 9 also launches commercial communications satellites into high-altitude orbits.

Air Force officials have said they are working with SpaceX to ensure that their rockets are safe enough to risk flying U.S. military and intelligence satellites that are worth more than $1 billion each.

SpaceX wants the Air Force to reverse the sole-source award of 36 boosters to ULA and open the procurement to commercial competition.

The Air Force initially said 14 additional contracts would be open to competition, although it has since delayed half those contracts beyond 2019.

The SpaceX lawsuit comes amid growing concern about ULA's use of Russian-made RD-180 engines for its Atlas rockets at a time when Russia is facing sanctions for its annexation of Ukraine's Crimean peninsula.

Gass said Moscow had not informed the company, or its Russian supplier, about any plans to halt shipments of the RD-180 engines, but said ULA was moving to accelerate production of its Delta rockets, which do not use the Russian engines.

He gave no details on the likely cost of that move.

(Reporting by Andrea Shalal; Editing by Matt Driskill)

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