Pentagon leaders had hoped their next big competition for satellite launches would usher new entrants into the market. Instead, the work is poised to go to the pair of companies that currently dominate the market—at least for now.
In February, the Space Force announced that it would split the bidding for dozens of launches into two groups. “Lane 1” will include the “more risk tolerant” missions, “Lane 2” the more challenging and “critical” ones. By hiving off a pool of easier missions to bid for, Space Force leaders hope to enable emerging companies to better compete against industry leaders SpaceX and ULA.
But there is nothing that bars these established giants from competing for the Lane 1 launches—and no one else has rockets that can do the job yet anyway. Industry sources say it could be several years before emerging companies have finished developing their engines for new medium and heavy vehicles.
That’s fine for now, said Maj. Gen. Stephen Purdy, who runs the National Space Security Launch program at Space Systems Command. Companies that are on a credible path to launch a rocket that can haul 20,000 pounds to low Earth orbit within a year can join the indefinite delivery/indefinite quantity contract that Space Force will use for the tranche, dubbed National Space Security Launch Phase 3. But to actually win a launch job, a company’s new rocket must have successfully put at least one other customer’s satellite into space.
“If they won’t be able to fall in on year one, we know we have two solid providers in Lane 2 that can bid in Lane 1. When they’re able to execute and when they’ve got their commercial bid in place, they can on-ramp to the IDIQ at that point,” Purdy said at the recent Space Symposium in Colorado Springs, Colorado.
The Space Force aims to start awarding contracts in 2025 and begin launches in 2027 but it “really depends where the commercial market is,” Purdy said. He hopes that by “year three or so” all of the market forces will be in play and the Space Force can have a multi-phase competition. Lane 1 will award contracts through 2029, with an option to continue for five more years. Lane 2 contracts will be awarded through 2029.
“I think the people that you envision are the companies that have already flown something, like SpaceX, Relativity, Astra, Firefly, ABL. There are a number of companies in that kind of range that have already started…I don’t see a true startup going directly into NSSL,” said Randy Kendall, vice president of launch program operations at the Aerospace Corporation.
Kendall said another major player is sure to be Rocket Lab, a company that has been dominating the small launch market. The company is developing a larger, reusable rocket, Neutron, to haul almost 30,000 pounds to LEO and compete for Lane 1 launches.
Rocket Lab CEO Peter Beck said he’s “pleased with the requirement for Lane 1 competitors to have accomplished a successful mission to orbit, so it separates out paper rockets.”
Rocket Lab, which began developing the Neutron in 2021, is aiming for first flight next year—a timeline some doubt is possible. For example, SpaceX’s Raptor engine started development in 2014 and didn’t have its first flight test until last week.
“When would we have new Lane 1 providers? That’s hard to say because it depends on how a lot of things go over the next couple of years, with some of these new providers building out their new systems,” Kendall said.
Relativity Space recently delayed the planned first launch of its Terran R rocket by two years to 2026. The reusable rocket is designed to lift more than 50,000 pounds to LEO.
“We fully understand the need for incumbents to continue to provide launch services in Lane 1 as emerging providers work to field medium- to heavy-lift vehicles over the next several years,” said Josh Brost, Relativity’s senior vice president of revenue operations. “Relativity is leveraging lessons learned from our Terran 1 pathfinder vehicle and scaling production and test capabilities that de-risk Terran R’s core systems and allow us to share a realistic schedule with our customers and the public.”
The two lane-system comes after calls from Congress for the Space Force to widen its NSSL program.
The new approach reflects congressional direction to “to maintain reliability requirements for assured launch, while responding to the increased demand for launches and fostering competition,” said Rep. Doug Lamborn, R-Colo., chairman of the House Armed Services strategic forces subcommittee.
This strikes a balance while recognizing that “there are certain operational requirements that only the advanced incumbents are physically able to meet,” said Rep. Seth Moulton, D-Mass., ranking member of the strategic forces subcommittee.
Purdy said “most people” he talked to at the Space Symposium favor the two-lane approach, but predicted “minor wording changes” when the second draft comes out in a few months. The Space Force aims to release the final RFP by the end of the year, he said.
All this is happening amid reports that ULA co-owners Boeing and Lockheed Martin will put the joint venture up for sale later this year. The company is slated to receive engines from Jeff Bezos’s Blue Origin.
While the exact timeline for new companies to fly Lane 1 missions is unclear, Kendall said the Space Force is clearly interested in developing the domestic launch market and there will continue to be a “tremendous” demand for these services with the increase of proliferated LEO constellations.
“For a long time, the holy grail of launch was to generate a high enough launch rate that you’d get reliability, and low prices, economic operating quantities—things like that—and I think we’re effectively there today,” he said.
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