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SpaceX urges Congress to expedite commercial spaceflight regulation reforms
Speaking in a Congressional hearing on the morning of June 26th, SpaceX Director of Government Affairs Caryn Schenewerk reaffirmed the company’s commitment to conducting “more than 25 [launches]” in 2018, a feat that will require a ~50% increase in launch frequency over the second half of the year.
Related to the focus of this particular hearing, namely regulatory reform, Representative Rick Larsen (WA-2) appeared to speak for everyone when he mirrored the four panelists’ sense of urgency for beginning the process of reforming federal space launch regulations by asking for an informal meeting outside the doors of the chamber once the session concluded, stating that “it’s that urgent.” In order for companies like SpaceX (and eventually Blue Origin) to be able to sustainably and reliably reach cadences of one launch per week in the near future, the currently cumbersome and dated launch licensing apparatus will almost invariably require significant reforms.
Pressure to remove artificial bottlenecks growing
Two primary problems were identified by the Air Line Pilots Association (ALPA), ULA, Blue Origin, and SpaceX officials present before the Congressional committee: the extreme sluggishness of licensing and the similarly obtuse brute-force integration of launch vehicle operations with the federal systems of air traffic control tasked with safely orchestrating tens of thousands of aircraft flights daily.
Whereas nominal orbital rocket launches result in vehicles like SpaceX’s Falcon 9 spending less than 90 seconds of real time within the bounds of that controlled airspace, the massive and disruptive “keep-out zones” currently required by the FAA for rocket launches frequently disrupt air traffic for more than 100 times as long. According to Ms. Schenewerk, SpaceX believes it already possesses the capabilities to integrate live Falcon 9 and Heavy telemetry with air traffic control, allowing those keep out zones to be dramatically compressed and highly responsive to actual launch operations, similar to how aircraft traffic is dealt with today.
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- Falcon 9 1046’s Block 5 upper stage shown on its May 11 debut launch with Bangabandhu-1. SpaceX’s rockets already provide rich telemetry live to the company’s launch controllers. (SpaceX)
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- After CRS-15, all orbital launches will be use Block 5 boosters and upper stages. The upgraded rocket’s next launch is NET July 20. (Tom Cross)
On the specific launch licensing side of this regulatory coin, SpaceX, Blue Origin, and ULA all expressed distaste for current standards, in which a worst-case scenario could see a launch provider forced to wait more than 200 days (up to eight full months) from the moment of filing to a launch license grant. Worse, even slight adjustments to a granted launch license require launch providers to resubmit themselves to that 200+ day process, effectively making timely modifications undependable exceptions to the rule.
Old rules, new rockets
The real barrier to these common-sense regulatory reforms is quite simply the extraordinary sluggishness of the FAA and those tasked with updating its guidelines and regulatory structures. Rep. Larsen was not exaggerating when he stated that he foresaw Congress choosing to delay those reforms by another 5+ years if given the opportunity, and it was thus likely a relief for the panel of witnesses (PDF) to hear him agree that these reforms must be pursued with the utmost urgency. In its current state, the FAA’s launch licensing is liable to be utterly swamped by the imminent introduction of multiple new smallsat launch providers on top of the already lofty launch cadence ambitions of SpaceX, ULA, and Blue Origin, as well as Orbital ATK to a lesser extent.
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With SpaceX leading the charge, the American launch industry is already a year or more into a true renaissance of American spaceflight, and the FAA is simply not equipped to handle it. If reforms can be completed with haste rarely seen in Congress, the federal government can at a minimum ensure that it does not become a wholly artificial and preventable bottleneck for that explosion of domestic spaceflight activity.
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- SpaceX’s Demo Mission-1 Crew Dragon seen preparing for vacuum tests at a NASA-run facility, June 2018. (SpaceX)
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- A Falcon 9 fairing during encapsulation, when a launch payload is sealed inside the fairing’s two halves. This small satellite is NASA’s TESS, launched in April 2018. (NASA)
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- A combination of scientific satellites and five Iridium NEXT communications satellites preparing for launch in May 2018. (NASA)
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- Telesat’s SSL-built Telstar 19V conducts testing in an anechoic chamber before launch, currently NET July 19. (SSL)
Speaking of that activity, SpaceX is scheduled to begin its H2 2018 manifest push with as many as six Falcon 9 launches (five with Block 5 boosters) over the next ~60 days. Barring an abrupt increase in rocket booster production speeds, sources have confirmed that those 2-3 summer months will likely also feature one of the first rapid Falcon 9 Block 5 reuses, potentially seeing one of SpaceX’s highly-reusable rockets complete two orbital launches in approximately one month (30-50 days). That will, of course, depend upon both customer agreeability and the availability of rockets and launch facilities, but the goal of a rapid Block 5 reuse before summer’s end still stands, at least for now.
Up next is CRS-15, which will see the last orbital Block 4 Falcon 9 launch a flight-proven Cargo Dragon to the ISS with several thousand pounds of supplies in tow, with liftoff scheduled for NET 5:42 am EDT, June 29.
Follow us for live updates, peeks behind the scenes, and photos from Teslarati’s East and West Coast photographers.
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Tom Cross – Twitter
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In a new note to investors on Tuesday, Morgan Stanley analyst Andrew Percoco said that Tesla has one big financial question to answer for investors regarding its Robotaxi rollout, Full Self-Driving software, and Optimus.
Percoco said in the note that, for the most part, investors are still very positive about the direction the company is headed. However, there are some things the firm would like to see, and they have to do with financials.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Tesla bulls are more than convinced that the company’s Full Self-Driving software is proof it can develop physical AI. Financially, however, there are still some questions, especially on elevated spending, which CEO Elon Musk said would occur as the company works to roll out Robotaxi faster and continue developing its Optimus robot.
The latter two are where Tesla will have to prove progress to investors, as Percoco writes that both projects “will require clearer evidence that Robotaxi is scaling and more tangible Optimus proof points to support the ROI on elevated capex.”
Percoco said the second quarter earnings call did not change his long-term thesis of where Tesla is positioned in the AI race, which is out in front. However, there are concerns that weaker gross margins and higher R&D spend will stress financials, and that has “sharpened our (and investors’) focus on measurable progress across Robotaxi and Optimus.”
Additionally, Robotaxi still needs to be proven with more operation in existing cities while maintaining safety but improving how many rides it gives in any given time, he said. For Optimus, Percoco wrote that he is “still looking for evidence beyond commentary around SOP.”
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Morgan Stanley put Percoco in charge of covering Tesla after long-time analyst Adam Jonas transitioned to the automotive side.
Currently, Morgan Stanley has a $415 price target on Tesla and a ‘Hold’ rating on the stock. It is trading at around $330 at the time of publication, which was 2:30 P.M. on the East Coast.
SpaceX’s massive investment in AI will make it a big winner, Argus Research said after the company’s successful earnings call last week.
The firm also upgraded shares to a Buy from Hold and set a $160 price target.
SpaceX (NASDAQ: SPCX) is currently recovering from its heavy AI infrastructure investments, as it spent nearly $16 billion in Q2 alone. The company did this primarily by monetizing high-demand GPU compute capacity at a much faster pace than traditional data center economics would suggest.
Company CFO Bret Johnsen said that SpaceX would be able to pay back anything on new deployments within a year.
There are plenty of ways the company can do this:
Leasing excess compute capacity through contracts
SpaceX has already built Colossus and Colossus II, largely for its own model training. However, much of that capacity is already rented out to third parties. It already has major deals with Anthropic, Google, and Reflection AI. These partnerships are adding billions per month to SpaceX’s spreadsheet.
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High utilization driven by industry-wide scarcity
The demand for advanced AI training and inference capacity continues to exceed what is available for use. SpaceX can fill new racks quickly after they come online, so the capital deployed converts into revenue with minimal idle time.
Additionally, management and outside observers have described the new compute capital as behaving more like a cost-of-goods-sold than traditional multi-year capex, especially because of this rapid monetization pattern.
Capacity has already scaled from ~0.4 GW a year to 1.4 GW annually by the end of Q2. There are targets of more than 2 GW by year-end.
High incremental margins on the rental business once capacity is online
GPU cloud providers often operate at strong gross margins. SpaceX can monetize capacity that was already partially built or can be added efficiently. This means that incremental EBITDA margins on the rental revenue are usually high. This accelerates cash recovery relative to the gross capital outlay.
Parallel monetization of its own AI software and applications
Beyond pure infrastructure rental, SpaceX also generates revenue from Grok through subscriptions and usage, from X through ads, data, and other related services, enterprise APIs, and the planned integration of the Cursor coding tools acquisition.
These application layers ride on the same compute infrastructure and provide additional high-margin streams that could offset build-out costs. AI-segment revenue overall rose sharply to about $2.6 billion in Q2, according to Motley Fool. This was driven primarily by the infrastructure contracts, but the software side is also partially responsible.
Efficient, large-scale deployment and vertical integration advantages
SpaceX has emphasized the rapid construction of power and cooling infrastructure and favorable cost-per-megawatt economics relative to industry benchmarks in some disclosures.
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Combined with its ability to scale capacity aggressively and the fact that many contracts start generating revenue within months of capacity coming online, the effective payback compresses dramatically compared with more conventional multi-year data-center projects.
SpaceX’s dominant near-term recovery path will turn the AI clusters into a hyperscale-style compute rental business for other leading AI companies while still using a portion for internal models.
Tesla headlights have caused a recall of over 20,000 of the company’s two most popular vehicles, the Model 3 and Model Y, due to the low-beam bulb exceeding the maximum allowed intensity according to federal standards.
Tesla initiated the recall with the National Highway Traffic Safety Administration (NHTSA) this morning, stating that the low-beam output “exceeds the maximum allowed intensity in the outer upper-right and outer upper-left areas of the 10U and 90U zone, as prescribed in FMVSS No. 108.”
Tesla sourced the impacted headlights from Marelli Automotive Lighting, a Mexico-based company. The recall impacts 2020-2023 Model Y vehicles and 2017-2023 Model 3 vehicles. It is estimated that every VIN in this recall is impacted by the defect.
🚨 Tesla is recalling 20,349 2020-23 Model Y vehicles and 2017-23 Model 3 vehicles due to an excessively bright headlamp low beam.
Currently, there is no remedy plan in place, as it is still being developed. pic.twitter.com/y34cIO2U0B
— TESLARATI (@Teslarati) August 11, 2026
Typically, Tesla would remedy recalls of this nature through an Over-the-Air software update, which has been a major focus of criticism by the company and its supporters because the NHTSA still refers to it as a “recall,” even though it requires no action by the vehicle owner. The fix is shipped over the internet and downloaded to the car.
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However, there appears to be a potentially different solution for this problem. Tesla has not developed a remedy for this issue, so it could potentially be on the way. The big issue appears to be the fact that these recalled lamps are out of production, and this is an old body style for both vehicles. The headlights and front-end designs are completely different.
Tesla switched to another supplier when the affected headlight design was discontinued. It plans to begin notifying owners of their remedy options by September 15.
Tesla filed a petition protesting the recall to fix the vehicles’ headlight issue, but the NHTSA denied it. Now, Tesla will come up with a solution to fix it.
Tesla has one big financial question to answer for investors: Morgan Stanley
SpaceX AI investment gamble will make it a big winner, firm says
