The Visionary – SpaceX

The Visionary – SpaceX

SpaceX

Part lll of “To Boldly Go”

Space X or Space Exploration Technologies Corporation was created in 2002 by financier Elon Musk.  It is located in Hawthorne California.  Musk, best known for his highly successful Tesla Electric car, also is the founder and CEO of SolarCity, manufacturers of solar panels for homes and industry.  Musk has stated that SolarCity, Tesla, and SpaceX  are all part of his vision to change the world and humanity.  His plans include reducing global warming through sustainable energy production and consumption.  And, reducing “risk of human extinction” by “making life multiplanetary.”   He plans on setting up a human colony on Mars.

However, of the two big boys in the current space race, Virgin Galactic and Space X, it is Space X that is leading the way.  In 2008 Space X launched the first privately funded liquid propellant rocket, the Falcon 1, into orbit.  Then in 2010 they were the first privately funded company to launch, orbit and recover a vehicle from space, the Dragon.  In 2012, they were the first private company to send a vehicle, the Dragon, to the International Space Station.

SpaceX has since flown ten missions to the International Space Station under a cargo resupply contract with NASA.  NASA awarded them a contract in 2010 to develop and demonstrate a Dragon capsule capable of carrying astronauts to the ISS and returning them safely to Earth.  NASA is so impressed with Dragon, they just ordered two more.

Falcon 9
Falcon 9 booster landing vertically

In 2011, SpaceX began work on a privately funded reusable launch system technology development program.  Then, additionally, in December 2015, SpaceX flew back a first stage booster to a landing pad near the launch site.  It successfully achieved a first in space flight history by making a powered vertical landing.  According to Wikipedia:

“In April 2016, with the launch of CRS-8 a routine resupply flight to the ISS, SpaceX successfully vertically landed a first stage on an ocean drone ship landing platform. Later, in May 2016, in another first, SpaceX again landed a first stage, but during a significantly more energetic geostationary transfer orbit mission. In March 2017, SpaceX became the first to successfully re-launch and land the first stage of an orbital rocket.

SpaceX DragonWith the construction of a manned version of the Dragon capsule well under way, Elon Musk and SpaceX have set their sights higher.  Now, they plan to go to Mars.  In fact, work on the Red Dragon Mars Ship is already underway.  According to SpaceX President Gwynne Shotwell:

“We were focused on 2018, but we felt like we needed to put more resources and focus more heavily on our crew program and our Falcon Heavy program. So we’re looking more for the 2020 timeframe for that.”

Since that statement, the Mars unmanned mission was pushed back to 2025 beacause of SpaceX’s present schedule.  They simply don’t have the personnel yet to effectively work on all their ongoing projects.

Part lV of our series will involve “The Moon and Beyond.”

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4 Responses to "The Visionary – SpaceX"

  1. Well written!

    Now consider the practical side for just Elon Musk.

    “Los Angeles entrepreneur Elon Musk has built a multibillion-dollar fortune running companies that make electric cars, sell solar panels and launch rockets into space.

    And he’s built those companies with the help of billions in government subsidies.
    Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.

    “He definitely goes where there is government money,” said Dan Dolev, an analyst at Jefferies Equity Research. “That’s a great strategy, but the government will cut you off one day.”

    The figure compiled by The Times comprises a variety of government incentives, including grants, tax breaks, factory construction, discounted loans and environmental credits that Tesla can sell. It also includes tax credits and rebates to buyers of solar panels and electric cars.

    A looming question is whether the companies are moving toward self-sufficiency – as Dolev believes – and whether they can slash development costs before the public largesse ends.

    Tesla and SolarCity continue to report net losses after a decade in business, but the stocks of both companies have soared on their potential; Musk’s stake in the firms alone is worth about $10 billion. (SpaceX, a private company, does not publicly report financial performance.)

    Musk and his companies’ investors enjoy most of the financial upside of the government support, while taxpayers shoulder the cost.”

    This is not the World According to Steve Jobs, or Bill Gates, or Henry Ford, who risked their own and private money, those who got a Return on Investment (ROI) on their venture capital. Is this another Solyndra or will it be another Chrysler, the Lee Iacocca 1979 bailout warrants paid back, begrudgingly, to the government, we the people?

    This is not a bad thing, but it is not principled capitalism, unless the public gets a piece of the action. This new (sic) economic principle, stock ownership as part of labor participation, to fight robotics, is the concept of Mark Cuban, which he touts today as the answer to inevitable lost “repetitive” jobs to robotics.

    The stock market is an acceptable public risk-embraced, with shared upside and downside from successes to failures. Subsidies are not! If successful how much of the government (read public) subsidies will be paid back and at what return on investment?

    When venture capital source is public subsidies, the return on investment is too often not only fiat money zero, but an abusive outright grant with no reward. This is a subset of crony capitalism.

    Socialism also means risking other people’s money, enjoying the upside, shielded from the down side.

    Reply
  2. I read the Times article but this is what happens when the government simply doesn’t want to invest the time or the money on worthwhile projects. They are more concerned about projects that show returns immediately….looks good when you run again to keep your cushy job, not something that will payoff heavily in 10 or 12 years down the road. So it is left to the private industry to carry the torch, Space is an expensive proposition which is why it is usually left to governments. So it is no surprise to me when I read of the large government subsidies. And I have always been a proponent that people should know what they invest in with all the pitfalls that go with it. If they don’t do their homework it is their fault when they lose. Hey thanks for the comment it is very appreciated.

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  3. Steve Jobs was a magnificent liberal, a JFK liberal. Elon Musk is an alt-liberal, a radical progressive.

    Most, if not all, start up, venture capital for Steve Jobs came from the private sector, and in later life from earned rewards, wealthy friends, and the stock market.

    Musk and his companies’ investors enjoy most of the financial upside of the government support, while taxpayers shoulder the cost.

    Some argue, effectively, the payoff for the public would come in the form of major pollution reductions, but only if solar panels and electric cars break through as viable mass-market products. For now, both remain niche products for mostly well-heeled customers.

    “The subsidies have generally been disclosed in public records and company filings. But the full scope of the public assistance hasn’t been tallied because it has been granted over time from different levels of government.

    New York state is spending $750 million to build a solar panel factory in Buffalo for SolarCity. The San Mateo, Calif.-based company will lease the plant for $1 a year. It will not pay property taxes for a decade, which would otherwise total an estimated $260 million.

    The federal government also provides grants or tax credits to cover 30% of the cost of solar installations. SolarCity reported receiving $497.5 million in direct grants from the Treasury Department.

    That figure, however, doesn’t capture the full value of the government’s support.

    Since 2006, SolarCity has installed systems for 217,595 customers, according to a corporate filing. If each paid the current average price for a residential system — about $23,000, according to the Union of Concerned Scientists — the cost to the government would total about $1.5 billion, which would include the Treasury grants paid to SolarCity.

    Nevada has agreed to provide Tesla with $1.3 billion in incentives to help build a massive battery factory near Reno.
    The Palo Alto company has also collected more than $517 million from competing automakers by selling environmental credits. In a regulatory system pioneered by California and adopted by nine other states, automakers must buy the credits if they fail to sell enough zero-emissions cars to meet mandates. The tally also includes some federal environmental credits.

    On a smaller scale, SpaceX, Musk’s rocket company, cut a deal for about $20 million in economic development subsidies from Texas to construct a launch facility there. (Separate from incentives, SpaceX has won more than $5.5 billion in government contracts from NASA and the U.S. Air Force.)

    Subsidies are handed out in all kinds of industries, with U.S. corporations collecting tens of billions of dollars each year, according to Good Jobs First, a nonprofit that tracks government subsidies. And the incentives for solar panels and electric cars are available to all companies that sell them.

    Musk and his investors have also put large sums of private capital into the companies.

    But public subsidies for Musk’s companies stand out both for the amount, relative to the size of the companies, and for their dependence on them.

    “Government support is a theme of all three of these companies, and without it none of them would be around,” said Mark Spiegel, a hedge fund manager for Stanphyl Capital Partners who is shorting Tesla’s stock, a bet that pays off if Tesla shares fall.”

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  4. This is a healthy dose of reality, the other side of the argument.

    What is the argument? The argument is principled capitalism versus unprincipled capitalism.

    “Tesla factory workers reveal pain, injury and stress: ‘Everything feels like the future but us”.

    http://www.msn.com/en-us/money/companies/tesla-factory-workers-reveal-pain-injury-and-stress-everything-feels-like-the-future-but-us/ar-BBBfUeR?li=BBmkt5R&ocid=spartandhp

    Fifty years ago, a third of U.S. employees worked in factories, making everything from clothing to lipstick to cars. Today, a little more than one-tenth of the nation’s 131 million workers are employed by manufacturing firms. Four-fifths are in services.”

    http://usatoday30.usatoday.com/money/economy/2002-12-12-manufacture_x.htm

    “Manufacturing Jobs As Percent of U.S. Payroll Employment Fall to Record Low of 9.25% in March.”

    Whether justified or not, this is why manufacturing jobs in the 1969 were 26.6% and in March 2017 our manufacturing economy as a percentage of U.S. Payroll Employment is 9.25%.

    How much of this is due to inadequate technical training skills produced by our schools. How much is an unwillingness to compete with China and India at the technical skill level.

    There is always a tradeoff between profit and safety. As in NFL Football, what is an acceptable ratio? From 1960 to 2017 we have demonstrated that we cannot be competitive in a Global manufacturing arena. Is Trump correct in saying that 70,000 manufacturing plants have left or shutdown in the USA since 1950? This is the “Ice Age” of manufacturing.

    When has it not been true that to excel and prosper, one must take greater risks? And how does one compete with those who are incentivized to take more risks?

    Yes, safety is important. But, if it were absolute, there would be no cars!! With the Tesla at 1% of the automotive market, will it survive in an uncompetitive “prevent defense” manufacturing environment? The California plant is experiencing growing pains.

    Is Elon Musk the answer?

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