© Reuters. FILE PHOTO: The first stage of United Launch Alliance's Vulcan Pathfinder is shown after its arrival for cryogenic tank testing at Pad 41 of the Cape Canaveral Space Force Station in Cape Canaveral, Florida, U.S., on August 26, 2021. REUTERS/Joe Skipper
By Joey Roulette
WASHINGTON (Reuters) – The stakes are high in the first launch of the new Vulcan rocket by United Launch Alliance, a joint venture of Boeing (NYSE:) and Lockheed Martin (NYSE:).
A successful launch at Cape Canaveral next week will allow ULA to fulfill a huge backlog of missions worth hundreds of millions of dollars and establish a competitive footing with Elon Musk's SpaceX.
And it could prove vital to the two American aerospace companies' plans to sell their joint venture.
“It's a very nervous time for them,” said George Sowers, former ULA chief scientist who was key to the creation of Vulcan. “It's really the future of your company.”
The debut mission is a long-awaited milestone after months of several delays in the home stretch of Vulcan development, and following a testing mishap last year with a Vulcan upper-stage booster. ULA CEO Tory Bruno has said Vulcan has performed well during recent ground tests.
The mission checklist includes carrying a lunar lander that aims to make the first U.S. soft landing in half a century. The rocket will for the first time use engines supplied by Jeff Bezos' Blue Origin space company.
The Vulcan launch also comes at a time when Boeing and Lockheed, which formed ULA in a merger of their rocket programs in 2006, are looking to sell the jointly owned company, according to three people familiar with the talks.
Those talks have been a complex and protracted process for which the launch of Vulcan could have crucial implications, said the sources, who asked not to be identified.
ULA declined to comment on potential deal talks, although Bruno has previously said his company could be ready for an acquisition.
Boeing and Lockheed declined to comment.
Vulcan's debut launch, scheduled for 2:18 a.m. ET (0718 GMT) on Monday, is the culmination of a years-long development effort largely arising from ULA's need to replace its current Atlas (NYSE:) rocket. V. That rocket's imported Russian engines drew criticism from lawmakers that led to its planned retirement.
The retirement of Atlas, plus Vulcan's other rocket, Delta, will leave the 200-foot-tall Vulcan to handle dozens of lucrative missions and serve as the company's only challenger to SpaceX's reusable Falcon 9.
Vulcan's first mission will send a privately built lander from space robotics company Astrobotic to the moon. But the launch itself will also serve as the first of two certification flights required by the US Space Force before Vulcan can fly Pentagon satellites.
Space Force is a major Vulcan customer: The military branch in 2020 chose ULA's Vulcan and its retired Atlas V to launch 60% of the Pentagon's missions until around 2027.
Priced lower than its predecessors, approximately $110 million per launch, Vulcan will seek to regain market share from the Falcon 9, which is priced at approximately $62 million per launch. SpaceX's cheaper flights have eroded ULA's dominance in government satellite launches over the past decade.
Vulcan will also compete with Blue Origin's upcoming New Glenn rocket, which uses the same engines as Vulcan.
ACQUISITION TALKS
Talks to acquire ULA have been underway for more than a year and dozens of companies, including Blue Origin, have expressed interest, the sources said.
Blue Origin did not respond to a request for comment.
The reasons and timing for Boeing and Lockheed's sale of ULA are unclear. But there have been significant changes in the U.S. space industry since ULA's formation in 2006, when it was created to dominate government launches and capture some commercial demand from the then-nascent satellite market.
Commercial market growth was slower than expected, said Richard McKinney, an aerospace consultant and former head of the Air Force's space acquisition unit until 2007. “But it looks like we're already there.”
Amazon's (NASDAQ ) planned Kuiper network is set to generate crucial launch revenue for ULA.
That has helped provide Vulcan with a multimillion-dollar order book of about 80 missions split evenly between government and commercial customers, Bruno said.
The development of Vulcan and ULA's move away from its Atlas and Delta rockets have made estimates of the company's valuation difficult to pin down, but analysts speculate it could be between $2 billion and $3 billion.
Boeing and Lockheed each have their own competing space units. Lockheed, among other activities, has ventured into building lunar rovers and has made strategic investments in ABL Space, a small launch startup with plans to build larger rockets in the future.
Boeing's space program has had problems, mainly with its delayed Starliner astronaut capsule that rivals SpaceX's more established Crew Dragon. Problems with Starliner development have cost Boeing about $1.5 billion since 2014.
The new ownership could allow ULA to innovate beyond the launch sector in ways its corporate parents were unwilling to allow, said former ULA chief scientist Sowers.
“The company's bylaws were fixed and were very restrictive,” he said. “They are always competing and couldn't agree on anything. We weren't allowed to innovate.”
