NASA’s SLS Costs Won’t Go Down With Future New Contract

The recent assessment by NASA’s Office of Inspector General has raised crucial concerns about the sustainability of NASA’s Space Launch System (SLS) rocket program.

Media remote cameras setup outside Launch Pad 39B and aimed at NASA’s Space Launch System (SLS) rocket with the Orion spacecraft aboard. Credits: NASA/Bill Ingalls — *NASA’s Space Launch System (SLS) rocket at Launch Complex 39B, with the Orion spacecraft aboard. Credits: NASA/Bill Ingalls*

Despite initial optimism surrounding cost reductions through a new service-based model, the reality appears to be more complicated.

The ambitious cost-saving goal of 50% reduction in launch costs, touted by NASA, is now being questioned as “highly impractical“, as indicated in the OIG report published on October 12. The report suggests that the SLS program may remain significantly over the budgeted costs, potentially exceeding $2 billion per launch, making it crucial for NASA to explore alternative heavy-lift space flight systems to sustain its ambitious exploration goals with the Artemis Program.

Transition To Service Contract

The proposal to transition to a services contract, known as the Exploration Production and Operations Contract (EPOC), with Deep Space Transport, a joint venture involving major contractors Boeing and Northrop Grumman, was initially intended to significantly cut costs and allow for a more flexible use of the SLS rocket beyond the Artemis lunar exploration missions.

However, the Inspector General’s analysis suggests that this move may not yield the anticipated cost benefits, pointing to the challenging market dynamics and the complexities of negotiating cost reductions without sufficient competition. In essence, the future of the SLS program seems mired in an intricate web of budgetary constraints and limitations on cost-saving initiatives.

*Estimated SLS costs, per unit. Credits: NASA Inspector General*

One of the critical issues identified in the report revolves around the feasibility of achieving the ambitious 50% cost reduction under the EPOC contract. Despite Boeing’s optimistic outlook on the achievability of the proposed cost reduction, the OIG report remains skeptical, citing ongoing struggles to meet cost-saving targets in key areas such as core stage assembly and the production of the RS-25 engine.

“Our analysis shows a single SLS Block 1B will cost at least $2.5 billion to produce—not including Systems Engineering and Integration costs—and NASA’s aspirational goal to achieve a cost savings of 50 percent is highly unrealistic.”
— NASA Office of Inspector General Report

The base of SLS's Core Stage for Artemis I, built by Boeing, while moving at Michoud Assembly Facility. Credits: NASA/Jude Guidry — *The base of SLS’s Core Stage for Artemis I, built by Boeing, while moving at Michoud Assembly Facility. Credits: NASA/Jude Guidry*

With limited competition in the market, NASA may face challenges in negotiating substantial cost reductions, setting it apart from the dynamics seen in other launch services and, above all, the Commercial Crew Program.

Commercial Alternatives Should Be Explored

The report also underscores the necessity for NASA to explore other potential heavy-lift launch alternatives, especially considering the agency’s long-term strategic goals.

While the SLS currently remains the primary option for launching the Orion spacecraft, the report emphasizes the likelihood of emerging human-rated commercial alternatives in the next few years, explicitly citing SpaceX, ULA and Blue Origin.

“Further driving down costs is the competition between aerospace companies such as SpaceX, ULA, and Blue Origin, with both SpaceX and Blue Origin currently developing reusable medium- and heavy-lift launch vehicles that will compete with NASA’s SLS single-use rocket“.
— NASA Office of Inspector General Report

This suggests the importance of NASA actively monitoring the developments in heavy-lift space flight systems and engaging in discussions to evaluate the financial and strategic feasibility of incorporating these alternatives into its future exploration plans.

Additional Customers? Unsuccessful Plan…

Moreover, recent assessments have indicated that efforts to secure additional customers for the SLS, including the Department of Defense, have been largely unsuccessful, with potential users opting for alternatives from companies like Blue Origin, SpaceX, and United Launch Alliance.

Starship Rocket and Super Heavy Booster stacked at SpaceX's Starbase Launch Site. Credits: SpaceX — *Starship Rocket and Super Heavy Booster stacked at SpaceX’s Starbase Launch Site. Credits: SpaceX*

This trend raises significant questions about the long-term sustainability of the SLS program and highlights the necessity for NASA to remain open to more economically viable and sustainable options for its ambitious space exploration missions.

The challenges surrounding the SLS program are multifaceted: recently, a GAO Report stated that NASA admitted the unaffordability of the SLS Program. The call for NASA to reevaluate its long-term strategy and explore alternative heavy-lift launch options remains a crucial step in ensuring the sustainability of the agency’s deep space exploration objectives.

As NASA grapples with the complexities of reducing the costs associated with the program, the need for a comprehensive reassessment of its launch strategy becomes increasingly imperative for the successful execution of its future missions.