Pentagon awards Elon Musk’s SpaceX and United Launch Alliance $635M in military launch contracts; beating out Jeff Bezos’ Blue Origin, Northrop Grumman

The U.S. Air Force announced on Friday it has awarded rocket builders United Launch Alliance (ULA) and Elon Musk’s SpaceX $653 million in combined military launch contracts to launch national security missions. The contract is under the Pentagon’s next-generation, multibillion-dollar launch capability program.

The awards are part of the Pentagon’s 2014 mandate from Congress to end Pentagon Use of Russia’s RD-180 engine and transition to US-made rockets for launching Washington’s most sensitive national security payloads to space. In December 2014, Congress passed the defense authorization bill that prohibits future use of a Russian-built rocket engine that is routinely used to launch U.S. national security satellites.

The Russian-built RD-180 is the main engine on United Launch Alliance’s Atlas 5 rocket, which is one of two rocket vehicles the company uses to launch most U.S. government satellites and virtually all national security missions. The RD-180 engine is built by NPO Energomash of Russia and sold to ULA by RD-Amross, a joint venture between Energomash and United Technologies Corp.

As part of the contract, the Centennial, Colorado-based United Launch Alliance will receive 60% of those launch service orders using its next-generation Vulcan rocket while Musk’s SpaceX, using its Falcon 9 and Falcon Heavy rockets, will receive 40%, the Air Force said on Friday.

Four rocket companies, Elon Musk’s SpaceX, ULA, Jeff Bezos’ Blue Origin, and Northrop Grumman, bid for the contracts, with the military set to spend about $1 billion per year on launches. Elon Musk’s SpaceX and ULA beat out Northrop Grumman and Jeff Bezos’ Blue Origin, to win the contract.

The landed Falcon 9 rocket booster from SpaceX’s Demo-2 crewed mission returns to Port Canaveral in Florida. (Credit: SpaceX)

The contracts are for launch service orders beginning in 2022 and allocate $337 million to ULA, a joint venture between Boeing and Lockheed Martin Corp, and $316 million to SpaceX for the first missions of roughly 34 total that the two rocket firms will support through 2027.

The program, called National Security Space Launch (NSSL) Phase 2, is aimed at “building a competitive industry base that we hope doesn’t just help military and national security missions, but that helps our nation continue to compete and dominate in space,” the Air Force’s acquisition chief Will Roper told reporters on Friday..

In an announcement released on Friday, the U.S. Air Force said, “United Launch Services LLC, Centennial, Colorado, has been awarded task orders for $337,000,000 for the National Security Space Launch (NSSL) Phase 2 contract. The NSSL Phase 2 contract is a firm-fixed-price, indefinite-delivery requirements contract for launch service procurements supporting launches planned between fiscal 2022 through fiscal 2027.”

The launch service contract includes early integration studies, launch service support, fleet surveillance, launch vehicle production, mission integration, mission launch operations, mission assurance, spaceflight worthiness, and mission unique activities for each mission.

“Today’s awards mark a new epoch of space launch that will finally transition the Department off Russian RD-180 engines,”Roper said in a statement.

Congrats SpaceX team!