ULA plans new rocket, restructuring

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Exclusive: ULA plans new rocket, restructuring to cut launch costs in half

United Launch Alliance is starting to develop a whole new rocket system and will be restructuring its processes and workforce to slash launch costs in half amid smaller military budgets and competition from SpaceX.

The result will be a smaller ULA in the near term, but one able to grow again and win new kinds of business in the long run, said Tory Bruno, new CEO of the Centennial-based rocket maker in his first interview since being appointed Aug. 12.

Bruno, the former president of Lockheed Martin's strategic missiles and missile defense programs, said ULA will have preliminary design ideas by year's end for a new line of rockets blending the best features of ULA's Atlas V and Delta IV rocket families.

The new launch system, its booster stage powered by new engines made by Jeff Bezos' Blue Origin company, is meant to start flying in 2019 and cap a remaking of ULA as a more efficient organization.

"We are working right now to design what that future will be. And we're going to finish our [preliminary] studies this year, and we're going to announce this is what our next generation launch system will look like," he said. "There will be other technologies that are enabling of that whole system, and they'll be part of what brings the overall cost down .... We're cutting [ launch cost] in half again, we're getting in to the commercial [launch] marketplace. We will also adjust design our teams and our organization to be the most effective at delivering that."

What affect the restructuring will have on ULA's work force isn't yet clear, Bruno said, but he expects ULA will be smaller. How much smaller remains to be seen.

ULA's board chose Bruno to replace Mike Gass, the first CEO to run the Lockheed Martin Corp. and Boeing Co. joint venture. ULA formed at the end of 2006.

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"Affordability is even more important, because if we can't be affordable then our customers can't cover all their missions. It's important that all of them are covered, not just some of them," he said. "There's an opportunity for the government to have competition now in this marketplace, and there are new entrants who are bringing in new thoughts and ideas, so ULA adapts to that. We cut costs in half [in forming ULA]. We're going to cut them in half again and bring in a whole lot of innovation."

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In May, ULA revealed pricing ranges for individual block buy missions range between $164 million and $350 million, depending on the size of the payload, its destination and other factors.

That price range is half of what the comparable launches would've been when Boeing and Lockheed Martin launched their Delta and Atlas rockets separately. Gass predicted earlier this year ULA's average price per rocket booster could go below $100 million. Bruno's cost goals could put some launches well under that amount.

Space Exploration Technologies Corp., as SpaceX is formally known, is challenging the contract in federal court, arguing it should be allowed to bid against ULA for the work.

Bruno says he's used to such pressures from the highly competitive world of missile defense contracting. He said competition is good for ULA.

"We're not afraid of competition; there's nothing anti-competitive about ULA. We have the best team in the world. We have the premier product line. We know how to bring our costs down. So we're happy to compete," Bruno said.

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Bruno detailed some ways ULA is streamlining its rocket design, manufacturing and assembly processes. Some traditions ? such as full dress rehearsals of launches and duplicative tests of every solder on a circuit board that's tested again upon final assembly ? were started before ULA was launching its current Delta IV and Atlas V rockets. Looking back at its 88 launches, ULA can identify which are unnecessary "belt and suspenders" tests and which have actually caught real problems.

Dropping unnecessary tests and streamlining processes will bring down costs, he said. Building a new rocket system around a Blue Origin-made booster engine ? meant to replace the RD-180 engines that are imported from Russia ? is expected to result in the rest of the cost savings.

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