United Launch Alliance has said it did not bid for a contract to launch a next generation GPS satellite in 2018, clearing the way for rival SpaceX to win its first national security mission. It said a government ban on using Russian engines, coupled with Air Force bidding rules, meant it was unable to submit a compliant bid.
United Launch Alliance has said it did not bid for a contract to launch a next generation GPS satellite in 2018, clearing the way for rival SpaceX to win its first national security mission.
The US-based joint venture between Boeing (NYSE:BA) and Lockheed Martin (NYSE:LMT) said a government ban on using Russian made rocket engines, together with Air Force bidding requirements, meant it was unable to submit a compliant bid for GPS III-X launch services.
It said it did not have the accounting systems in place to meet a need to certify that funds from other government contracts would not benefit the launch mission in 2018, according to a statement sent to reporters.
“In addition, the [request for proposals’] Lowest Price Technically Acceptable (LPTA) structure allows for no ability to differentiate between competitors on the basis of critical factors such as reliability, schedule certainty, technical capability and past performance,” ULA said.
The JV, which has been looking to cut the cost of its workhorse Atlas 5 rocket to win more commercial business in the face of strained government budgets, believes its 100% mission success record gives it a key competitive advantage.
SpaceX, whose Falcon 9 vehicle suffered its first complete loss in June, made an unsolicited and ultimately unsuccessful bid to launch the new GPS satellites for US$79.9m each in 2012, as it sought to break a monopoly that ULA had held on military launches since it was formed in 2006.
Earlier this year SpaceX won Air Force certification to compete for these missions, heralding what was supposed to be renewed competition in the market.
However, Congress has legislated to ween ULA off the Russian-made RD-180 engines that currently power Atlas 5, banning their use for national security missions amid strained relations with the Kremlin.
ULA had warned earlier that it would not be able to compete with SpaceX for these launches without being able to order more RD-180s, and the Pentagon recently rejected an attempt to get a waiver.
The group is developing an all-American engine with Blue Origin but this is not planned to be ready until 2019.
Industry watchers have speculated that ULA’s troubles had in part prompted Aerojet Rocketdyne (NYSE:AJRD), a US engine specialist, to make a surprise US$2bn bid for it in September.
ULA swiftly rejected the deal. Craig Cooning, ULA’s chairman and Boeing’s president of network and space systems, told SatelliteFinance that it did not take the offer seriously because having ULA is “part of our overall core mission”.
Lockheed was reportedly keener to negotiate a deal as part of a wider portfolio restructuring.
SpaceX already launches civil mission for US space agency NASA, and has been working through a packed commercial manifest since launching its first satellite to geostationary transfer orbit in late 2013.
