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The fixed-price, milestone-based contract has a total value of $2.89 billion.
SpaceX was one of three companies that received initial HLS contracts nearly one year ago for early design work on their lander concepts. SpaceX offered a version of its Starship vehicle, launched on its Super Heavy booster and refueled in low Earth orbit before going to the moon.
NASA officials previously stated they would attempt to make more than one Option A award in order to preserve competition in the program. “Competition — having multiple suppliers for us — is an extremely important principle. It’s on our minds,” Mark Kirasich, director of the advanced exploration systems division at NASA, said in February.
However, in a hastily arranged call with reporters to announce the selection of only SpaceX, officials acknowledged that limited budgets forced them to select only SpaceX. The agency received $850 million for the HLS program in fiscal year 2021, about one-fourth its original request.
“We weighed a lot of things, including what we’re getting from the demonstration mission, what we want for our potential future procurement for our sustainable landers, and it was in NASA’s best interest, along with the budget that was there, for us to award to one,” Kathy Lueders, NASA associate administrator for human exploration and operations, said.
In a source selection statement, NASA said that SpaceX’s price was lower than the other two teams, led by Blue Origin and Dynetics, “by a wide margin.” SpaceX received a technical rating of “Acceptable” and management rating of “Outstanding,” compared to a technical rating of “Acceptable” and management rating of “Very Good” for Blue Origin and “Marginal” and “Very Good” ratings for Dynetics. Blue Origin’s price was “significantly higher” than SpaceX and Dynetics was “significantly higher” than Blue Origin.
Lueders, the source selection authority for HLS, concluded that while Blue Origin’s proposal “has merit,” she did not select it for a second Option A award “because I find that its proposal does not present sufficient value to the Government” and because of the limited funding after selecting SpaceX for one award. “I do not have enough funding available to even attempt to negotiate a price from Blue Origin that could potentially enable a contract award.”
Dynetics fared even worse, with Lueders concluding that its proposal “is overall of limited merit and is only somewhat in alignment with the objectives as set forth in this solicitation.”
Future competition
That Option A award will support development of the Starship lunar lander, and include at least one uncrewed test flight to land on the lunar surface before NASA proceeds with a crewed mission. “We want to make sure that everything is checked out and everything is ready” before putting NASA astronauts on the spacecraft, said Lisa Watson-Morgan, NASA HLS program manager.
However, after that crewed demonstration mission NASA will procure landing services through a separate contract. Agency officials said they will accelerate planning for that contract, where NASA will procure landing services for multiple missions. “As early as next week, we’ll be engaging industry for their input on how to best fashion and enable competition for this very important acquisition,” said Kirasich at the media briefing.
That future contract will be a full and open competition, allowing the other HLS competitors and perhaps other companies to compete with SpaceX. Any competitor, though, would be at a disadvantage as they will lack SpaceX’s Option A contract to fund lander development.
Another open question is the schedule for SpaceX’s Option A mission. Steve Jurczyk, NASA acting administrator, said the request for proposals put in a 2024 goal for that mission. However, he noted the agency is currently performing a “comprehensive review” the overall Artemis program, including schedules and budgets. He said earlier in the briefing that NASA’s goal was to return humans to the lunar surface “as quickly and safely as possible.”
“These human-rated system developments are very complex, and there is risk. The NASA team will have the insight into the progress that SpaceX is making,” he said. “If they’re hitting their milestones, we may have a shot at 2024.”
“We always fly when it’s safe,” Lueders added.
Reactions
SpaceX, which did not participate in the NASA briefing, issued only a tweet acknowledging winning HLS. “We are humbled to help @NASAArtemis usher in a new era of human space exploration,” the company wrote.
NASA has selected Starship to land the first astronauts on the lunar surface since the Apollo program! We are humbled to help @NASAArtemis usher in a new era of human space exploration → https://t.co/Qcuop33Ryz pic.twitter.com/GN9Tcfqlfp
— SpaceX (@SpaceX) April 16, 2021
Blue Origin, in a statement to SpaceNews, had little to say about the NASA selection of rival SpaceX over its “National Team” that included Draper, Lockheed Martin and Northrop Grumman. “The National Team doesn’t have very much information yet. We are looking to learn more about the selection.” Dynetics did not immediately respond to a request for comment.
One member of Congress, though, was critical of NASA’s decision. “I am disappointed that the acting NASA leadership decided to make such a consequential award prior to the arrival of a new permanent NASA administrator and deputy administrator,” said Rep. Eddie Bernice Johnson (D-Texas), chair of the House Science Committee.
Johnson had been critical of NASA’s approach of using industry partnerships to develop human landers and procure landing services, rather than a more conventional contracting approach, where NASA would own the vehicles and intellectual property.
“The decision to make the award today also comes despite the obvious need for a re-baselining of NASA’s lunar exploration program, which has no realistic chance of returning U.S. astronauts to the Moon by 2024,” she added, calling for the agency’s new leadership to “carry out its own review of all elements of NASA’s Moon-Mars initiative to ensure that this major national undertaking is put on a sound footing.”