News
US Air Force awards SpaceX $20m contract to support its biggest spy satellites
Slipping beneath the watchful eye of many skilled defense journalists, the government contracting database FPDS.gov indicates that the US Air Force awarded SpaceX more than $20 million in November 2017 to conduct a design study of vertical integration capabilities (VIC). Describing what exactly this means first requires some background.
Vertical whaaaat?
The flood of acronyms and technical terminology that often follow activities of the Federal government should not detract from the significance of this contract award. First and foremost, what exactly is “vertical integration” and why is significant for SpaceX? Not to be confused with more abstract descriptions of corporate organization (vertical integration describes one such style), integration here describes the literal process of attaching satellite and spacecraft payloads to the rockets tasked with ferrying them to orbit.
Likely as a result of its relative simplicity, SpaceX has used a system of horizontal integration for as long as they have been in the business of launching rockets, be it Falcon 1, Falcon 9, or Falcon Heavy. In order to integrate payloads to the rocket horizontally, SpaceX has a number of horizontal integration facilities (HIF) directly beside each of their three launch pads – two in Florida, one in California. After being transported from the company’s Hawthorne, CA rocket factory, Falcon 9 and Heavy boosters, second stages, payload fairings, and other miscellaneous components are all brought into a HIF, where they are craned off of their transporters (a semi-trailer in most cases) and placed on horizontal stands inside the building.
- The large, white crawler underneath Falcon 9 is one of several methods of transportation SpaceX uses. (Instagram /u/robhubar)
- Falcon Heavy is composed of a Falcon 9 upper stage and three Falcon 9-class boosters. (SpaceX)
- The fully-integrated Falcon Heavy rolls out to Pad 39A. For vertical integration, think of this… but vertical. (SpaceX)
While in the HIF, all three main components are eventually attached together (integrated). The booster or first stage (S1) has its landing legs and grid fins installed soon after arrival at the launch site, followed by the mating of the first and second stages. Once these two primary components of the rocket are attached, the entire stack – as the mated vehicle is called – is once again lifted up by cranes inside the facility and placed atop what SpaceX calls the strongback (also known as the Transporter/Launcher/Erector, or TEL). A truly massive steel structure, the TEL is tasked with carrying the rocket to the launch pad, typically a short quarter mile trek from the integration facility. Once it reaches the pad, the TEL uses a powerful hydraulic lift system to rotate itself and its rocket payload from horizontal to vertical. It may look underwhelming, but it serves to remember that a complete Falcon 9/Heavy and its TEL are both considerably more than twice as tall as a basketball court is long.
Falcon Heavy goes vertical pic.twitter.com/uG1k0WISv1
— Elon Musk (@elonmusk) January 5, 2018
Once at the pad, the TEL serves as the rocket’s connection to the pad’s many different ground systems. Crucially, it is tasked with loading the rocket with at least four different fuels, fluids, and gases at a broad range of temperatures, as well as holding the rocket down with giant clamps at its base, providing connection points to transmit a flood of data back to SpaceX launch control. SpaceX’s relatively unique TEL technology is to some extent the foundation of the company’s horizontal integration capabilities – such a practice would be impossible without reliable systems and methods that allow the rocket to be easily transported about and connected to pad systems.
Still, after the Amos-6 mishap in September 2016, which saw a customer’s payload entirely destroyed by a launch vehicle anomaly ahead of a static fire test, SpaceX has since changed their procedures, and now conducts those static fire tests with just the first and second stages – the payload is no longer attached until after the test is completed. For such a significant decrease in risk, the tradeoff of an additional day or so of work is minimal to SpaceX and its customers. Once completed, the rocket is brought horizontal and rolled back into the HIF, where the rocket’s payload fairing is finally attached to the vehicle while technicians ensure that the rocket is in good health after a routine test-ignition of its first stage engines.
- Elon Musk’s Roadster seen before being encapsulated in Falcon Heavy’s massive payload fairing. Below the Tesla is the payload adapter, which connects it to the rocket. (SpaceX)
- Imagine this building-sized fairing traveling approximately TWO MILES PER SECOND. (USAF)
- Finally, the fairing is transported vertically to the HIF, where it can be flipped horizontal and attached to its rocket. (Reddit /u/St-Jed-of-Calumet)
Before being connected to the rocket, the payload itself must also go through its own integration process. Recently demonstrated by a flurry of SpaceX images of Falcon Heavy and its Roadster payload, this involves attaching the payload to a payload adapter, tasked with both securing the payload and fairing to the launch vehicle. Thankfully, the fairing is far smaller than the rocket itself, and this means it can be vertically integrated with the payload and adapter. The final act of joining and bolting together the two fairing halves is known as encapsulation – at which point the payload is now snug inside the fairing and ready for launch. Finally, the integrated payload and fairing are lifted up by cranes, rotated horizontally, and connected to the top of the rocket’s second stage, marking the completion of the integration process.
A different way to integrate
Here lies the point at which the Air Force’s $20m contract with SpaceX comes into play. As a result of certain (highly classified) aspects of some of the largest military satellites, the Department of Defense (DoD) and National Reconnaissance Office (NRO) prefer or sometimes outright require that their payloads remain vertical while being attached to a given rocket. The United Launch Alliance (ULA), SpaceX’s only competition for military launches, almost exclusively utilizes vertical integration for all of their launches, signified by the immense buildings (often themselves capable of rolling on tracks) present at their launch pads. SpaceX has no such capability, at present, and this means that they are effectively prevented from competing for certain military launch contracts – contracts that are often the most demanding and thus lucrative.
It’s clear that the Air Force itself is the main impetus pushing SpaceX to develop vertical integration capabilities, a reasonable continuation of the military’s general desire for assured access to orbit in the event of a vehicle failure grounding flights for the indefinite future. For example, if ULA or SpaceX were to suffer a failure and be forced to ground their rockets for months while investigating the incident, the DoD could choose to transfer time-sensitive payload(s) to the unaffected company for the time being. With vertical integration, this rationale could extend to all military satellites, not simply those that support horizontal integration.
- A hop and a skip south of 39A is SpaceX’s LC-40 pad. (SpaceX)
- Like all SpaceX pads, horizontal integration is a central feature. (SpaceX)
- LC-40’s brand new TEL carries a flight-proven Falcon 9 and Dragon out to the pad. (SpaceX)
Fittingly, the ability to vertically integrate satellites is likely a necessity if SpaceX hopes to derive the greatest possible value from its recently and successfully introduced Falcon Heavy rocket, a highly capable vehicle that the government is likely very interested in. Although the specific Air Force contract blandly labels it a “Design Study,” (FPDS.gov account required) its hefty $21 million award may well be far more money than SpaceX needs to design a solution. In fact, knowing SpaceX’s famous ability to develop and operate technologies with exceptional cost efficiency, it would not be shocking to discover that the intrepid launch company has accepted the design study grant and instead jumped head-first into prototyping, if not the construction of an operational solution. More likely than not, SpaceX would choose to take advantage of the fixed tower (known as the Fixed Service Structure, FSS) currently present at Pad 39A, atop which a crane and work platforms could presumably be attached
Intriguingly, it is a real possibility that Fairing 2.0 – its first launch scheduled to occur as early as Feb. 21 – could have been upgraded in part to support present and future needs of the Department of Defense, among numerous other benefits. Fairing 2.0’s larger size may have even been precipitated by physical requirements for competing for and dealing with the largest spysats operating by the DoD and NRO, although CEO Elon Musk’s characterization of that change as a “slightly larger diameter” could suggest otherwise. On the other hand, Musk’s offhand mention of the possibility of significantly lengthening the payload fairing is likely aimed directly at government customers in both the civil and military spheres of space utilization. Time will tell, and it certainly will not hurt SpaceX or its customers if Fairing 2.0 is also considerably easier to recover and reuse.
Under consideration. We’ve already stretched the upper stage once. Easiest part of the rocket to change. Fairing 2, flying soon, also has a slightly larger diameter. Could make fairing much longer if need be & will if BFR takes longer than expected.
— Elon Musk (@elonmusk) February 12, 2018
Ultimately, it should come as no surprise that SpaceX would attempt to leverage this contract and the DoD’s interest in ways that might also facilitate the development of the company’s futuristic BFR rocket, intended to eventually take humans to the Moon, Mars, and beyond. As shown by both 2016 and 2017 iterations of the vehicle, it appears that SpaceX intends to use vertical integration to attach the spaceship (BFS) to the booster (BFR). While it’s unlikely that this Air Force contract will result in the creation of a vertical integration system that could immediately be applied to or replicated for BFS testing, the experience SpaceX would gain in the process of building something similar for the Air Force would be invaluable and essentially kill two birds with one stone.

While now outdated, SpaceX’s 2016 Mars rocket featured a giant crane used for vertical integration. BFR appears to use the same approach. (SpaceX)
Follow along live as I and launch photographers Tom Cross and Pauline Acalin cover these exciting proceedings live and in person.
Teslarati – Instagram – Twitter
Tom Cross – Twitter
Pauline Acalin – Twitter
Eric Ralph – Twitter
Elon Musk
Tesla is about to make parking in busy lots less stressful than ever
Tesla is about to make parking in busy parking lots at businesses and other points of interest less stressful than ever by allowing drivers more control over where they park and how, CEO Elon Musk confirmed on X.
Tesla has been working to improve the parking performance of vehicles utilizing the Full Self-Driving suite, but now it is looking to add more customization, allowing drivers to choose the specific space they park in, but also potentially the orientation the car pulls into the spot:
It’s coming soon
— Elon Musk (@elonmusk) July 21, 2026
Musk has reiterated on X twice over the past several weeks that Tesla is working to make things with the FSD suite based more on the driver’s specific preferences and behaviors that were seen in past drives.
Essentially, it sounds like if you tend to park away from a business to avoid other vehicles, Tesla FSD will soon recognize that preference of yours and start parking further away as well. Additionally, the prospect of assigned parking spaces has been something many owners have voiced concerns about.
Living in a community with assigned parking spaces makes using FSD incredibly difficult as it will rarely park in the correct spot when there are so many to choose from. This is also pertinent in work settings where there are sometimes assigned parking spaces.
The updates to Tesla’s Full Self-Driving suite in terms of listening to driver preferences with parking are also extending to routing. Tesla announced yesterday that with the release of its 2026 Summer Update, it was adding Automatic Navigation and Preferred Routes:
Tesla reveals 2026 Summer Update with crazy fixes to Nav and more
Tesla has always maintained the idea that any human input is bad input, and that, ideally, Tesla Full Self-Driving will always make the right decision. Of course, this is all in theory, but the issue is that so many of Tesla’s interventions have come because it does something that is not necessarily wrong, but perhaps not what the driver would prefer.
Taking these preferences into account will help Tesla alleviate some of the potentially unnecessary interventions that drivers perform.
News
Tesla starts preparing for Optimus in its smartphone app
Tesla is starting to prepare for the launch of the Optimus robot in its smartphone app, new coding strings show. Elon Musk has referred to Optimus as what will be the greatest-selling product of any kind of all time, and now, Tesla is getting ready for its launch.
Tesla’s smartphone app had several first-time mentions of the Optimus program, according to Tesla App Updates, who intially reported on the appearance. Here’s what they found:
A Dedicated “Robot” Phone Key Authentication
Tesla is working on a Bluetooth Low Energy, or BLE, authentication that is specifically for robots. This does not only apply to Optimus, though, as Robotaxi, which is Tesla’s autonomous ride-hailing platform, might also identify vehicles within the fleet as robots as well.
Tesla shows rapid teardown of Model S and X lines, paving the way for Optimus at Fremont
Essentially, pairing your phone as a key to anything Tesla identifies as a robot to a “whitelist” of authorized devices. Optimus, Robotaxi, or other products that fall into this category will only respond if the device trying to communicate with it is authorized.
This is a great security feature that will eliminate at least face-value and low-level threats.
Home Data Collection and System Alerts
This appears to be somewhat of a neural network for Optimus within your house. There will be a dedicated screen that asks for consent to collect both video and spatial data while Optimus performs in-home tasks. Everything from vacuuming, washing dishes, dusting, and other activities will be tracked.
There will also be a comprehensive alert system that will track everything from low battery to mechanical issues.
Other Changes
Most of the changes tracked in this particular app update are related to Tesla’s 2026 Summer Update, and include things such as image assets for new features, a preview of the new custom wraps feature, and other unique features.
You can check out our coverage on what is included with the 2026 Summer Update here:
Tesla reveals 2026 Summer Update with crazy fixes to Nav and more
Investor's Corner
Tesla Q2 Earnings: Here’s what to expect
Tesla (NASDAQ: TSLA) will report its earnings for the second quarter of 2026 this evening after market close, and investors and analysts are waiting anxiously to see what the company will report for the second three-month span of the year.
Analysts have already put out their expectations from a financial standpoint for the company’s second quarter, but what’s unknown is what Tesla plans to discuss during the call.
Financial Expectations
Wall Street consensus expectations put Tesla’s Earnings Per Share (EPS) at $0.53, while revenues are expected to come in around $26.4 billion.
This would compare to an EPS of $0.39 and $22.19 billion compared to Tesla’s Q2 2025. Last quarter, EPS came in at $0.41 on $22.387 billion of revenue. Additionally in Q1, Tesla beat analyst expectations, but shares dropped over 3 percent the following trading day.
What We Expect
In terms of discussions, Tesla earnings are pretty sporadic and depend on a handful of things, including current events, investor questions, and more.
Tesla uses a platform called Say to field questions from investors and analysts. These questions are what will be used during the call. Here are the top 5 from the Retail side and top 3 from the Institutional side:
Retail:
“Tesla has missed short-term guidance on robotaxi 3 earnings reports in a row, from 50% coverage of USA by end of 2025 to most recently 7 new cities in 1H26. What is keeping Tesla back from accomplishing these short term goals that they’ve set for themselves?”
“What are the main constraints to expanding robotaxi operations faster, and how do you see that lining up with Cybercab production?”
“What’s the current status of Optimus Gen 3 production ramp, initial deployment in factories, and external sales timeline/volume for 2027? What tasks can we expect the Optimus to perform by end of 2027?”
“To reward long-term Tesla retail shareholders for their loyalty, can you commit to achieving at least half of the goals outlined in your 2025 compensation plan before considering any offers to acquire or merge Tesla?”
“Why has growth of robotaxi vehicles stalled? When will we see cybercab start customer rides?”
Institutional
“Previously, you’ve said Tesla would lead the R&D while SpaceX would lead production for Terafab. Can you provide an update on how that division of responsibilities is evolving, and any additional clarity on the expected capital contributions from Tesla and SpaceX?”
“For autonomous driving, Tesla’s fleet created a huge data advantage by collecting billions of real-world miles. That advantage doesn’t yet exist for Optimus. How should we think about data availability and its impact on Optimus development?”
“Why is it necessary to limit robotaxi operations within specific zones within cities to start? Will every city have to be rolled out this way?”
Tesla will report earnings for Q2 this evening with the Shareholder Deck at 4 p.m. ET, with the call starting around 5:30 p.m. ET.








