The Billionaire Race: Bezos vs Musk – who will take off with the lunar lander contract?
September 12, 2021
3 min read
What's going on here?
Blue Origin, Jeff Bezos’ space firm, has sued the US Government over NASA’s decision to grant the coveted £2.1bn lunar lander contract solely to Elon Musk’s company SpaceX.
What does this mean?
Last year, NASA announced that it would award multiple contracts to the lunar lander programme which aims to return humans to the moon by the mid 2020s. Nevertheless, it decided to only award a single contract to SpaceX in April 2021 due to financial constraints imposed by the US government. This occurred despite formal financial offers by companies such as Dynetics and Blue Origins, who tried to renegotiate the situation by offering up to $2bn to be considered for the contract by bridging the “budget shortfall”.
In an open letter, Blue Origin argued that awarding the contract to only one company distorts competition as it allows one company to have an “insurmountable leverage over NASA” and provides a “multi-year head-start”. Somewhat ironically, Blue Origin then offered to pay $2bn should NASA reconsider its decision.
In its court filing on 13 August 2021, Blue Origin accused NASA of “unlawful and improper evaluation” of proposals. The space firm argued that “the issues identified in this procurement and its outcomes must be addressed to restore fairness, create competition, and ensure a safe return to the Moon for America”. Consequently, NASA has until 12 October 2021 to file a response to Blue Origin’s challenge.
What's the big picture effect?
Blue Origin’s court filing has the potential to create a ripple effect within the space industry as it has temporarily halted the work on the £2.1bn contract, therefore delaying NASA’s ability to get humans back to the moon as soon as possible. Both the US Government and Blue Origin have agreed to “an expedited litigation schedule” concluding on 1 November 2021, to minimise any serious delays. However, it is likely that the public will not know the true extent of the lawsuit as the court complaint will be kept under seal. This is due to the importance of keeping sensitive “proprietary information, trade secrets and confidential financial information” secret, as any leaks could create “severe competitive harm”.
In order to understand the importance of this case, one must comprehend why each company is competing for the NASA contract. On the one hand, SpaceX has the ultimate goal of long-distance interplanetary travel. This goal has begun to transpire through launching astronauts into orbit over the last year. SpaceX’s business model allows them to do this rapidly by securing funding from government and commercial contracts. On the other hand, Jeff Bezos’ primary goal for Blue Origin is to have “millions of people living and working in space”. Consequently, Jeff Bezos himself funds Blue Origin’s ventures and has successfully conducted its first crewed suborbital space flight this year. Nevertheless, the NASA contract offers Blue Origin the potential funds to speed up its technological developments, and therefore, potentially enabling Blue Origin to make its goal a reality.
This case raises important issues regarding whether the acquisition of the contract was carried out fairly, and whether the US Government has violated any laws or regulations during this process. This process will result in a vast amount of litigation work, and advisory work from the involved firms. It is important to note that this case is the latest stint in the billionaire race between Jeff Bezos and Elon Musk, as the two race towards ‘claiming’ space. Therefore, as the billionaire boys fight for a seat at the spacecraft table, we must ask ourselves – is this a good use of public funds? And who will take off triumphant?
Report written by Sofia Antipatis
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