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How SpaceX Falcon Heavy undercuts its competition three-fold
Following the stunningly successful debut of SpaceX’s giant Falcon Heavy rocket, the spaceflight fan community and industry have been abuzz with attempts to estimate Falcon Heavy’s true price as an expendable or partially expendable launch vehicle. Thankfully, CEO Elon Musk appears to have been interested enough to fill in the knowledge gaps concerning the rocket’s full range of prices and took to Twitter to answer several questions.
Among several other intriguing comments that I will cover later on, Musk revealed that a fully expendable Falcon Heavy would cost approximately $150 million, while a partially expendable FH would sport 90% of the performance while expending the center stage and landing the side boosters at sea rather than on land. In that latter mode of operation, a Falcon Heavy launch would cost about $95 million, whereas unlocking the final 10% of performance with a fully expandable configuration would be priced around $150 million. While $90-150 million is undeniably a huge amount of cash in any sense, Falcon Heavy delivers far more performance for multiple times less than the available competition.
- ULA’s Delta IV Heavy rolls out to the pad for a launch in 2016. Note the people in the bottom left for a sense of scale. (ULA)
- ULA’s Delta IV Heavy rolls out to the pad for a launch in 2016. Note the people in the bottom left for a sense of scale. (ULA)
- The fully-integrated Falcon Heavy rolls out to Pad 39A. For vertical integration, think of this… but vertical. (SpaceX)
- DIVH and FH are approximately the same size, although FH is far denser. (SpaceX)
The only real competition for Falcon Heavy is the United Launch Alliance’s (ULA) Delta IV Heavy rocket, a triple-core launch vehicle with nine total launches under its belt since its 2004 debut. Aside from one test launch for NASA, all of DIVH’s operational flights have been tasked with launching uniquely heavy military payloads to uniquely high orbits – both of which require an exceptionally capable rocket. Designed as a fully expendable vehicle, ULA’s Heavy is capable of launching ~29,000 kg to low Earth orbit (LEO) and ~14,000 kg to geostationary transfer orbit (GTO), whereas the fully reusable Falcon Heavy has a max payload of about 23,000 kg to LEO and 8,000 kg to GTO.
However, if Musk’s claim of 10% performance loss as a partially expendable launcher holds true, the story changes quite a bit. In its fully expendable configuration (call it the Delta IV Heavy config), Falcon Heavy is a beast of a rocket, quoted at ~64,000 kg to LEO and 26,700 kg to GTO. Subtract 10-25%, and Falcon Heavy still trounces the Delta rocket, all while costing well under $150 million, and probably closer to $100 million. According to a late-2017 report from the US Government Accountability Office, Delta IV Heavy costs as much as $400 million per launch, although ULA CEO Tory Bruno responded to Musk’s claim of $400-600 million earlier this morning with a figure of $350 million for the rocket.
Hey @elonmusk , congrats again your heavy launch. Clarification: Delta IV Heavy goes for about $350M. That’s current and future, after the retirement of both Delta IV Medium and Delta II. She also brings unique capabilities, At least until we bring Vulcan on line.
— Tory Bruno (@torybruno) February 12, 2018
Such a high price is not exceptionally surprising, if only for the fact that Delta IV Heavy launches as infrequently as it does. With an average cadence of one launch every 18 months or 1.5 years, the technical expertise and facilities required to design, build, and operate the DIVH must remain employed regardless of whether the rocket launches. Although Delta was previously a family of rockets, thus enabling some of its designers and builders to cross-populate, the final non-Heavy Delta launch occurred just a handful of weeks ago. Short of layoffs, this means that ULA’s Delta expertise are now solely working to build and operate a rocket with approximately seven launches scheduled between 2018 and 2023 – in short, $400 million is quite plausibly on the low end of the rocket’s actual cost, backend included. Both ULA and the Department of Defense are aware, however, that Delta IV Heavy is the only rocket currently capable of launching some of the missions desired and required by the National Reconnaissance Office (NRO), and are thus at least partially willing to swallow the vehicle’s high cost. SpaceX’s Falcon Heavy is bound to introduce some much-needed competition into the stagnant market after its highly successful introduction, but it will likely be a year or more before the new rocket is certified to launch the same highly sensitive and expensive payloads as ULA’s Delta IV Heavy.
How are SpaceX’s prices so low?
Still, this does not answer the “how” of SpaceX’s prices. What can even begin to explain Delta IV Heavy’s 200-400% premium over Falcon Heavy? The best answer to this crucial question was by no coincidence also one of the main reasons that Elon Musk created SpaceX. From the very beginning, SpaceX pursued a slim and flexible organizational structure, prioritized hiring brilliant and motivated engineers with hands-on experience, and encouraged the practice of thinking from first principles. Dolly Singh, head of SpaceX’s talent acquisition in the mid-2000s, described the rocket startup’s atmosphere like so:
We searched for candidates with a proven history of building and breaking things…candidates who had been tinkering with hardware systems for years…I knew the people who filled my open positions would be put to the test every day and would be asked to meet heretofore impossible targets. We looked for people with a history of defeating the odds, who had made careers of overcoming obstacles.
https://www.instagram.com/p/BVarZZSgfIP/
Birds of an organizational feather
In essence, this organizational philosophy has led SpaceX to become vertically integrated to the extent that is effective without comparison in the global aerospace industry. Vertical integration is a term used to describe the practice of bringing aspects of development and manufacturing in-house, whereas a company not attempting to integrate vertically would instead contract and subcontract out their design and manufacturing needs wherever possible. Musk is hard set on this philosophy: if SpaceX can do it in-house more cheaply than a contractor, they will become their own supplier. Companies like ULA – a cooperation between Lockheed Martin and Boeing – have the better part of a century of experience as heavyweights in the US military-industrial complex, a relationship that has quite literally changed processes of acquisition and created alternate realities of pricing.
Thick with armies of lobbyists, those military-industrial complex titans have help to direct the US down a path that has solidified truly insane concepts as the status quo. A cost-plus contracting framework almost universally applied in the procurement of military technology means that companies are nearly awarded for delays and cost overruns. Possibly even more absurd, the euphemistic strategy of “concurrency” espoused by those same titans has somehow convinced the upper echelons of US defense procurement that it is a good and preferable strategy to fully fund and build technologies en mass before any testing has been. Unsurprisingly, these two philosophies have led to years of delays and huge cost overruns as contractors and their subcontractors are forced to repair or modify extremely complex technological systems once bugs and problems are inevitably discovered down the road. The F-35 Lightning II – developed by Lockheed Martin – is perhaps the most famous example with near-weekly tales of abject failure – gun systems that are years late and inaccurate to the point of uselessness, extremely buggy and flawed software that the jet literally cannot function without, an oxygen system that frequently gives its pilots hypoxia and grounds the entire F-35 fleet, among dozens of other incredible missteps – and all for the most expensive fighter aircraft yet developed in the US. Tyler Rogoway, one of the best practicing defense journalists, has covered the debacle of concurrency and cost-plus contracting for many years and is a recommended read for anyone interested in the above industries.
- While it may look damn cool, the F-35 is easily the biggest government procurement debacle in all of human history. (Lockheed Martin)
- Operated by the same company responsible for the F-35, Atlas 5 is a highly reliable and equally expensive rocket. (ULA)
Now, back to spaceflight…
Parting from this partial diversion, the purpose of this brief history of military procurement is to provide some level of context as to why NASA and its spaceflight contractors act as they do, where they derived their organizational structures and philosophies, and why SpaceX is different.
Famously, a NASA study in 2010 estimated the cost of SpaceX’s Falcon 9 development to be approximately $4 billion under variables representative of NASA’s own R&D and engineering culture, or $1.7 billion using a more commercial, fixed-cost strategy. When SpaceX offered to cooperate with the addition of their internal data on Falcon 9’s cost, the same model’s estimate plummeted to less than $600 million, representing a truly extraordinary overestimate of SpaceX’s development costs, while SpaceX’s data showed approximately $300 million of investment in the first version of Falcon 9. Simply put, NASA’s cost estimates were off by more than an order of magnitude (PDF) – SpaceX successfully developed an unprecedented orbital-class rocket for mere pennies to NASA’s dollar.
Famously, a NASA study in 2010 estimated the cost of SpaceX’s Falcon 9 development to be approximately $4 billion, while SpaceX’s own data showed approximately $300 million of investment in the first version of Falcon 9. Simply put, NASA’s cost estimates were off by more than an order of magnitude.
More recently, Elon Musk has stated that SpaceX invested $1 billion or more in the development of reusability for Falcon 9, and this large investment can almost entirely explain why Falcon 9’s pricing has remained essentially unchanged over its seven years of life, even if it was already the cheapest rocket in its performance class. Despite the recent introduction and rapid routinization of operational reuse, SpaceX has not publicly changed the launch price from its $62 million base. Although there have been slight acknowledgments of small discounts from customers flying on reused boosters, the general theme is that reused rockets have not meaningfully lowered the cost of purchasing a launch. In practice, the cost of refurbishment and reuse of the first several Falcon 9 boosters was likely on par with the cost of a new booster, but the real reason for the lack of magnitudes of cost reduction lies in SpaceX’s desire to recoup some or all of the capital it invested in reusability. As the company matures its reuse expertise, the cost can be expected to plummet – Cargo Dragon’s reuse, for example, reportedly saved SpaceX 50% of the cost of a new capsule, and Falcon 9 is almost certainly far easier and thus cheaper to refurbish and refly.
The quote is from a 2015 hearing held by the Armed Services Committee: "I don't know how to build a $400 million rocket. Rather than ask how am I less expensive than ULA, I don't understand how ULA is as expensive as they are."
— Robin Seemangal (@nova_road) February 12, 2018
While payload fairings have turned out to be harder to recover than anticipated and Falcon 9’s second stage is likely to remain expendable for the foreseeable future, those components only comprise about 30% of the rocket’s price. If SpaceX can cut the cost of reuse to maybe 10-20% of the cost of a new booster, the remaining 30-60% of a new launch’s $62 million translates to approximately $20-35 million of profit for each reused launch. If, say, the company aims to fly flight-proven boosters on half of their launches in 2018, that translates into as many as 15 launches and as much as $500 million – or half of the $1 billion investment – recouped in a single year. With the introduction of Falcon 9 Block 5 in a few months, SpaceX will soon be flying an iteration of their workhorse rocket that is far faster, easier, and cost-effective to reuse. Ultimately, depending on how much of their initial investment SpaceX intends to recover, the huge profit margins they can derive from reuse could be redirected to drastic price cuts for the customer. More realistically, the company will likely lower its prices enough to ensure that their launch business is brutally competitive, and thus use those profit margins to begin heavily investing in BFR (Big F. Rocket), BFS (Big F. Spaceship), and the company’s loftier interplanetary goals more generally.
- Starship and a Martian city, circa 2017. (SpaceX)
- SpaceX’s 2017 BFS (now Starship) delivers cargo to a large lunar base. (SpaceX)
In fact, given that SpaceX President Gwynne Shotwell has quite consistently targeted early 2019 for the beginning of prototype BFS testing, SpaceX is probably already putting a significant proportion of their profits into Mars-focused R&D. As 2018 progresses, barring any unseen speed bumps, the funds available to SpaceX are bound to explode, and huge progress will likely begin to be made on actual hardware intended to enable colonies on the Moon and Mars.
Follow along live as launch photographer Tom Cross and I cover these exciting proceedings as close to live as possible.
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Tom Cross – Twitter
Eric Ralph – Twitter
Elon Musk
Tesla analysts believe Musk and Trump feud will pass
Tesla CEO Elon Musk and U.S. President Donald Trump’s feud shall pass, several bulls say.

Tesla analysts are breaking down the current feud between CEO Elon Musk and U.S. President Donald Trump, as the two continue to disagree on the “Big Beautiful Bill” and its impact on the country’s national debt.
Musk, who headed the Department of Government Efficiency (DOGE) under the Trump Administration, left his post in May. Soon thereafter, he and President Trump entered a very public and verbal disagreement, where things turned sour. They reconciled to an extent, and things seemed to be in the past.
However, the second disagreement between the two started on Monday, as Musk continued to push back on the “Big Beautiful Bill” that the Trump administration is attempting to sign into law. It would, by Musk’s estimation, increase spending and reverse the work DOGE did to trim the deficit.
Every member of Congress who campaigned on reducing government spending and then immediately voted for the biggest debt increase in history should hang their head in shame!
And they will lose their primary next year if it is the last thing I do on this Earth.
— Elon Musk (@elonmusk) June 30, 2025
President Trump has hinted that DOGE could be “the monster” that “eats Elon,” threatening to end the subsidies that SpaceX and Tesla receive. Musk has not been opposed to ending government subsidies for companies, including his own, as long as they are all abolished.
How Tesla could benefit from the ‘Big Beautiful Bill’ that axes EV subsidies
Despite this contentious back-and-forth between the two, analysts are sharing their opinions now, and a few of the more bullish Tesla observers are convinced that this feud will pass, Trump and Musk will resolve their differences as they have before, and things will return to normal.
ARK Invest’s Cathie Wood said this morning that the feud between Musk and Trump is another example of “this too shall pass:”
BREAKING: CATHIE WOOD SAYS — ELON AND TRUMP FEUD “WILL PASS” 👀 $TSLA
She remains bullish ! pic.twitter.com/w5rW2gfCkx
— TheSonOfWalkley (@TheSonOfWalkley) July 1, 2025
Additionally, Wedbush’s Dan Ives, in a note to investors this morning, said that the situation “will settle:”
“We believe this situation will settle and at the end of the day Musk needs Trump and Trump needs Musk given the AI Arms Race going on between the US and China. The jabs between Musk and Trump will continue as the Budget rolls through Congress but Tesla investors want Musk to focus on driving Tesla and stop this political angle…which has turned into a life of its own in a roller coaster ride since the November elections.”
Tesla shares are down about 5 percent at 3:10 p.m. on the East Coast.
Elon Musk
Tesla scrambles after Musk sidekick exit, CEO takes over sales
Tesla CEO Elon Musk is reportedly overseeing sales in North America and Europe, Bloomberg reports.

Tesla scrambled its executives around following the exit of CEO Elon Musk’s sidekick last week, Omead Afshar. Afshar was relieved of his duties as Head of Sales for both North America and Europe.
Bloomberg is reporting that Musk is now overseeing both regions for sales, according to sources familiar with the matter. Afshar left the company last week, likely due to slow sales in both markets, ending a seven-year term with the electric automaker.
Tesla’s Omead Afshar, known as Elon Musk’s right-hand man, leaves company: reports
Afshar was promoted to the role late last year as Musk was becoming more involved in the road to the White House with President Donald Trump.
Afshar, whose LinkedIn account stated he was working within the “Office of the CEO,” was known as Musk’s right-hand man for years.
Additionally, Tom Zhu, currently the Senior Vice President of Automotive at Tesla, will oversee sales in Asia, according to the report.
It is a scramble by Tesla to get the company’s proven executives over the pain points the automaker has found halfway through the year. Sales are looking to be close to the 1.8 million vehicles the company delivered in both of the past two years.
Tesla is pivoting to pay more attention to the struggling automotive sales that it has felt over the past six months. Although it is still performing well and is the best-selling EV maker by a long way, it is struggling to find growth despite redesigning its vehicles and launching new tech and improvements within them.
The company is also looking to focus more on its deployment of autonomous tech, especially as it recently launched its Robotaxi platform in Austin just over a week ago.
However, while this is the long-term catalyst for Tesla, sales still need some work, and it appears the company’s strategy is to put its biggest guns on its biggest problems.
News
Tesla upgrades Model 3 and Model Y in China, hikes price for long-range sedan
Tesla’s long-range Model 3 now comes with a higher CLTC-rated range of 753 km (468 miles).

Tesla has rolled out a series of quiet upgrades to its Model 3 and Model Y in China, enhancing range and performance for long-range variants. The updates come with a price hike for the Model 3 Long Range All-Wheel Drive, which now costs RMB 285,500 (about $39,300), up RMB 10,000 ($1,400) from the previous price.
Model 3 gets acceleration boost, extended range
Tesla’s long-range Model 3 now comes with a higher CLTC-rated range of 753 km (468 miles), up from 713 km (443 miles), and a faster 0–100 km/h acceleration time of 3.8 seconds, down from 4.4 seconds. These changes suggest that Tesla has bundled the previously optional Acceleration Boost for the Model 3, once priced at RMB 14,100 ($1,968), as a standard feature.
Delivery wait times for the long-range Model 3 have also been shortened, from 3–5 weeks to just 1–3 weeks, as per CNEV Post. No changes were made to the entry-level RWD or Performance versions, which retain their RMB 235,500 and RMB 339,500 price points, respectively. Wait times for those trims also remain at 1–3 weeks and 8–10 weeks.
Model Y range increases, pricing holds steady
The Model Y Long Range has also seen its CLTC-rated range increase from 719 km (447 miles) to 750 km (466 miles), though its price remains unchanged at RMB 313,500 ($43,759). The model maintains a 0–100 km/h time of 4.3 seconds.
Tesla also updated delivery times for the Model Y lineup. The Long Range variant now shows a wait time of 1–3 weeks, an improvement from the previous 3–5 weeks. The entry-level RWD version maintained its starting price of RMB 263,500, though its delivery window is now shorter at 2–4 weeks.
Tesla continues to offer several purchase incentives in China, including an RMB 8,000 discount for select paint options, an RMB 8,000 insurance subsidy, and five years of interest-free financing for eligible variants.
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