8 ms·

It is not possible to do a fair comparison of launch costs between Falcon 9 and other platforms without knowing the true cost of Falcon 9 launches.

by reso 3y ago

nordsieck 3y ago
> It is not possible to do a fair comparison of launch costs between Falcon 9 and other platforms without knowing the true cost of Falcon 9 launches. I don't know why you're so obsessed with cost. The only thing that matters when it comes to commercial providers is price. And SpaceX, (as far as I can tell) stands alone among the medium-heavy lift providers by providing a price directly on their website. Of course, for government launches the government typically wants extra services, which does boost the prices different levels for different missions (I think the Europa Clipper mission is particularly expensive for example). But all of those missions are competitively bid, and SpaceX tends to be the low price bidder, so those extra fees seem like they're probably pretty reasonable.
- objektif 3y ago
  Price is not a good metric here you can subsidize your pricing to hell if you have budget. Elon loves to do this btw.
  - bryanlarsen 3y ago
    The headline is that SpaceX is profitable, so they're not pricing below cost.
    - janc_ 3y ago
      They still operate at a loss?
    - rewmie 3y ago
      Profit is the result of all operations, not just launches. For instance, starlink is a SpaceX company. Starlink is reported to be responsible for up to 40% of SpaceX's revenue. https://spacenews.com/starlink-may-account-for-up-to-40-of-spacexs-2023-revenues/ https://spacenews.com/starlink-may-account-for-up-to-40-of-s...
      - TMWNN 3y ago
        Irrelevant. Hollywood accounting works because a film studio can, by shifting expenses to a particular film from elsewhere in the company, always claim that the film is unprofitable; the overall revenue and profit/loss for the studio is unaffected. The documents WSJ viewed are for SpaceX as a whole, not "SpaceX's launcher division". Even if the launcher division charged the Starlink division 9000 megazillion dollars per launch, that would be exactly balanced by the Starlink division having to book 9000 megazillion dollars of expense per launch. Again, according to the documents WSJ viewed, SpaceX overall has achieved profitability. That's a major accomplishment given it being by far the lowest-cost launch provider in the world.
        rewmie 3y ago
        > Irrelevant. Hollywood accounting works because (...) I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. Your comment is so far off it reads as something outputted by a poor machine learning model.
        TMWNN 3y ago
        > I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. My point is that even if SpaceX books Starlink launches as revenue,[1] it would still have to be accounted for as an expense on Starlink's side, so SpaceX's overall bottom line would not change. If SpaceX's confidential internal financials show that SpaceX has achieved profitability then, yes, that indicates that SpaceX is not pricing its launches below cost. >Your comment is so far off it reads as something outputted by a poor machine learning model. Sorry, not my fault that you can't comprehend the fact that revenue can't come out of nowhere. It has to always be balanced by expense, and this isn't some magic way for Musk to generate "fake profits". [1] A fairly common business practice, in and of itself. When an Apple employee receives a new Apple computer for use at work, that computer is booked as revenue for Apple; after all, Apple is acting as a customer for a product, albeit its own. The division that employee works for in turns records the price of that computer as an expense. The revenue amount is going to be lower than what an outside customer would pay—basically, Apple as seller will charge Apple as customer zero markup—but some revenue will be recorded all the same.
  - nordsieck 3y ago
    > Price is not a good metric here you can subsidize your pricing to hell if you have budget. 1. As far as I know, no one has presented any evidence that SpaceX sells Falcon 9/H launches for less than cost. ArianeSpace used to really talk up this point, but even they've mostly given up. 2. I'm not really sure why it matters. If SpaceX can sell for less than cost at their current volume, well... good for the tax payers - we're getting a deal. > Elon loves to do this btw. Really? I thought Tesla was known for it's high margins? I don't think any of Elon's other businesses are public.
    - renonce 3y ago
      > If SpaceX can sell for less than cost at their current volume, well... good for the tax payers - we're getting a deal. At the cost of killing all other competitors and letting SpaceX monopolize so we are stuck with whatever quotes from SpaceX?
      - nordsieck 3y ago
        > At the cost of killing all other competitors and letting SpaceX monopolize so we are stuck with whatever quotes from SpaceX? 1. Are you suggesting that SpaceX will bankrupt Japan (HIII), India (GSLV/PSLV), and Europe (Ariane 6)? That seems unlikely to me. 2. There's very little evidence that SpaceX will jack up prices when they're a monopoly. I mean, they're a defacto monopoly right now (in a limited sense) with ULA transitioning to Vulcan, and ArianeGroup transitioning to Ariane 6. And their prices haven't budged. 3. The DoD (as part of NSSL) and NASA work very hard to split large contracts between multiple launch providers - effectively ensuring that there is no monopoly in US medium-heavy launch providers.
      - panick21_ 3y ago
        Nonsense. Complete and uther nonsesens. Anybody who spends even 5 min realizes this is wrong. ULA isnt going away, no-matter how cheap SpaceX is. Arianespace wont go away. China, Russia, India and Japan wont go away. BlueOrigin wont go away. If anything SpaceX has lead to an explosive increase in competition.
    - rewmie 3y ago
- rhaway84773 3y ago
  That’s not the only relevant number because we know what tech has been over the past 2 decades. It’s been an effort to build non competitive monopolized markets. That’s what Uber is, that’s what the delivery services are, that’s what AirBNB is, that’s what Square is, etc. These companies will lose billions for years with this single intention. The true cost minus the listed price adjusted for years of interest and extremely high VCreturns are all useful numbers to know because that adjusted by a risk multiple will tell you how much wealth the investors are expecting the monopolization to transfer from the taxpayer to their pockets.
  - nordsieck 3y ago
    Your comment leads me to believe that you know very little about the rocket business. 1. SpaceX will never have a monopoly over launch because it's competing with lots of governments who will never give up their rocket programs. ArianeGroup, Japan/Mitsubishi, Russia, China, and India all have active launch programs (although Russia and China are isolated right now). 2. There are a truly stupid number of startups trying to compete for a slice of the launch pie. Most of them are in the small-lift launch segment for some reason, even though it's probably impossible to run a profitable rocket launch business in that segment of the market. But there are enough companies that aspire to launch larger rockets that SpaceX needs to be on its toes. Blue Origin, Rocket Lab, and Relativity are probably the main future competitors to SpaceX. And both Rocket Lab and Relativity have talked up prices that are equal to or lower than what SpaceX is currently offering. 3. The DoD and NASA are actively working to prevent SpaceX from forming a monopoly in the US market.
    - renonce 3y ago
      Only US, Russia and China have capabilities to launch rocket with human. With both Russia and China isolated there is only US left.
- rewmie 3y ago
  > I don't know why you're so obsessed with cost. This whole discussion is centered around cost. The only argument presented in favor of paying SpaceX for launches is launch cost. If it wasn't for costx why would an org like NASA even consider delegating a critical part of their mission to a third party?
- reso 3y ago
  Cost is more important than price in the long run because it tells us whether SpaceX has made genuine efficiency and technology developments that allow their prices to be long-term viable. Any one can sell a service at a loss, but you eventually run out of VC or saudi bucks to make up the difference, and then you have to jack your prices up again.
  - panick21_ 3y ago
    Anybody who spends even 10min actually thinking about this topic realizes that the idea that SpaceX subsudizes Falcon 9 launches to get price below cost is complete nonsense. Its just a convieniant attack on SpaceX because they are private. It has no bases in reality.

It is not possible to do a fair comparison of launch costs between Falcon 9 and other platforms without knowing the true cost of Falcon 9 launches.

by reso 3y ago

It is not possible to do a fair comparison of launch costs between Falcon 9 and other platforms without knowing the true cost of Falcon 9 launches.

nordsieck 3y ago

> It is not possible to do a fair comparison of launch costs between Falcon 9 and other platforms without knowing the true cost of Falcon 9 launches. I don't know why you're so obsessed with cost. The only thing that matters when it comes to commercial providers is price. And SpaceX, (as far as I can tell) stands alone among the medium-heavy lift providers by providing a price directly on their website. Of course, for government launches the government typically wants extra services, which does boost the prices different levels for different missions (I think the Europa Clipper mission is particularly expensive for example). But all of those missions are competitively bid, and SpaceX tends to be the low price bidder, so those extra fees seem like they're probably pretty reasonable.

objektif 3y ago
Price is not a good metric here you can subsidize your pricing to hell if you have budget. Elon loves to do this btw.
- bryanlarsen 3y ago
  The headline is that SpaceX is profitable, so they're not pricing below cost.
  - janc_ 3y ago
    They still operate at a loss?
  - rewmie 3y ago
    Profit is the result of all operations, not just launches. For instance, starlink is a SpaceX company. Starlink is reported to be responsible for up to 40% of SpaceX's revenue. https://spacenews.com/starlink-may-account-for-up-to-40-of-spacexs-2023-revenues/ https://spacenews.com/starlink-may-account-for-up-to-40-of-s...
    - TMWNN 3y ago
      Irrelevant. Hollywood accounting works because a film studio can, by shifting expenses to a particular film from elsewhere in the company, always claim that the film is unprofitable; the overall revenue and profit/loss for the studio is unaffected. The documents WSJ viewed are for SpaceX as a whole, not "SpaceX's launcher division". Even if the launcher division charged the Starlink division 9000 megazillion dollars per launch, that would be exactly balanced by the Starlink division having to book 9000 megazillion dollars of expense per launch. Again, according to the documents WSJ viewed, SpaceX overall has achieved profitability. That's a major accomplishment given it being by far the lowest-cost launch provider in the world.
      - rewmie 3y ago
        > Irrelevant. Hollywood accounting works because (...) I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. Your comment is so far off it reads as something outputted by a poor machine learning model.
        TMWNN 3y ago
        > I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. My point is that even if SpaceX books Starlink launches as revenue,[1] it would still have to be accounted for as an expense on Starlink's side, so SpaceX's overall bottom line would not change. If SpaceX's confidential internal financials show that SpaceX has achieved profitability then, yes, that indicates that SpaceX is not pricing its launches below cost. >Your comment is so far off it reads as something outputted by a poor machine learning model. Sorry, not my fault that you can't comprehend the fact that revenue can't come out of nowhere. It has to always be balanced by expense, and this isn't some magic way for Musk to generate "fake profits". [1] A fairly common business practice, in and of itself. When an Apple employee receives a new Apple computer for use at work, that computer is booked as revenue for Apple; after all, Apple is acting as a customer for a product, albeit its own. The division that employee works for in turns records the price of that computer as an expense. The revenue amount is going to be lower than what an outside customer would pay—basically, Apple as seller will charge Apple as customer zero markup—but some revenue will be recorded all the same.
- nordsieck 3y ago
  > Price is not a good metric here you can subsidize your pricing to hell if you have budget. 1. As far as I know, no one has presented any evidence that SpaceX sells Falcon 9/H launches for less than cost. ArianeSpace used to really talk up this point, but even they've mostly given up. 2. I'm not really sure why it matters. If SpaceX can sell for less than cost at their current volume, well... good for the tax payers - we're getting a deal. > Elon loves to do this btw. Really? I thought Tesla was known for it's high margins? I don't think any of Elon's other businesses are public.
  - renonce 3y ago
    > If SpaceX can sell for less than cost at their current volume, well... good for the tax payers - we're getting a deal. At the cost of killing all other competitors and letting SpaceX monopolize so we are stuck with whatever quotes from SpaceX?
    - nordsieck 3y ago
      > At the cost of killing all other competitors and letting SpaceX monopolize so we are stuck with whatever quotes from SpaceX? 1. Are you suggesting that SpaceX will bankrupt Japan (HIII), India (GSLV/PSLV), and Europe (Ariane 6)? That seems unlikely to me. 2. There's very little evidence that SpaceX will jack up prices when they're a monopoly. I mean, they're a defacto monopoly right now (in a limited sense) with ULA transitioning to Vulcan, and ArianeGroup transitioning to Ariane 6. And their prices haven't budged. 3. The DoD (as part of NSSL) and NASA work very hard to split large contracts between multiple launch providers - effectively ensuring that there is no monopoly in US medium-heavy launch providers.
    - panick21_ 3y ago
      Nonsense. Complete and uther nonsesens. Anybody who spends even 5 min realizes this is wrong. ULA isnt going away, no-matter how cheap SpaceX is. Arianespace wont go away. China, Russia, India and Japan wont go away. BlueOrigin wont go away. If anything SpaceX has lead to an explosive increase in competition.
  - rewmie 3y ago
rhaway84773 3y ago
That’s not the only relevant number because we know what tech has been over the past 2 decades. It’s been an effort to build non competitive monopolized markets. That’s what Uber is, that’s what the delivery services are, that’s what AirBNB is, that’s what Square is, etc. These companies will lose billions for years with this single intention. The true cost minus the listed price adjusted for years of interest and extremely high VCreturns are all useful numbers to know because that adjusted by a risk multiple will tell you how much wealth the investors are expecting the monopolization to transfer from the taxpayer to their pockets.
- nordsieck 3y ago
  Your comment leads me to believe that you know very little about the rocket business. 1. SpaceX will never have a monopoly over launch because it's competing with lots of governments who will never give up their rocket programs. ArianeGroup, Japan/Mitsubishi, Russia, China, and India all have active launch programs (although Russia and China are isolated right now). 2. There are a truly stupid number of startups trying to compete for a slice of the launch pie. Most of them are in the small-lift launch segment for some reason, even though it's probably impossible to run a profitable rocket launch business in that segment of the market. But there are enough companies that aspire to launch larger rockets that SpaceX needs to be on its toes. Blue Origin, Rocket Lab, and Relativity are probably the main future competitors to SpaceX. And both Rocket Lab and Relativity have talked up prices that are equal to or lower than what SpaceX is currently offering. 3. The DoD and NASA are actively working to prevent SpaceX from forming a monopoly in the US market.
  - renonce 3y ago
    Only US, Russia and China have capabilities to launch rocket with human. With both Russia and China isolated there is only US left.
rewmie 3y ago
> I don't know why you're so obsessed with cost. This whole discussion is centered around cost. The only argument presented in favor of paying SpaceX for launches is launch cost. If it wasn't for costx why would an org like NASA even consider delegating a critical part of their mission to a third party?
reso 3y ago
Cost is more important than price in the long run because it tells us whether SpaceX has made genuine efficiency and technology developments that allow their prices to be long-term viable. Any one can sell a service at a loss, but you eventually run out of VC or saudi bucks to make up the difference, and then you have to jack your prices up again.
- panick21_ 3y ago
  Anybody who spends even 10min actually thinking about this topic realizes that the idea that SpaceX subsudizes Falcon 9 launches to get price below cost is complete nonsense. Its just a convieniant attack on SpaceX because they are private. It has no bases in reality.