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At this point, they have the functional monopoly advantage of being able to set prices where they want them (in terms of having an exclusive technology their co
by fixermark 11y ago
At this point, they have the functional monopoly advantage of being able to set prices where they want them (in terms of having an exclusive technology their competitors do not have; they have competition, but if they can really slash their costs by 50% they have the capacity to set their price ten bucks below the competitions' prices and win).
... but if I understand correctly, one of the points of the reusable rocketry experiment is to be able to lower the price point to allow new customers who couldn't afford to launch at the previous per-pound cost. To give a terrible but not inaccurate analogy: Think similarly to how the Nintendo Wii found itself in entirely new markets of game players by droppping a $200 console onto the market alongside competition that was nearly double that price-point.
- simonh 11y agoOpening up space to new markets must be an essential component of their strategy. If they charged say 90% of the cost for non-reusable launches but their rockets were reusable, they would only need to manufacture a dozen or so vehicles, plus a few a year as replacements. To maintain economies if scale in their factory, they need to have a sustained production line and that means at even a steady pace, with high re usability they will soon be awash with rockets. They will have to bring prices down just to keep their fleet operating.