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SpaceX, NASA celebrate Blue Origin’s lunar lander lawsuit loss and get back to work
In a November 9th press conference, NASA leaders have begun to publicly celebrate the end of seven months of Blue Origin litigation and disruption to its Human Landing System (HLS). A federal court’s dismissal of that lawsuit means that the space agency can finally get back to work with SpaceX on its Starship Moon lander.
Following the failure of that lawsuit, NASA administrator Bill Nelson says that it will take the space agency some time to fully determine what and how much damage Blue Origin has caused. In the briefing, Nelson and associate administrators Kathy Lueders and Jim Free confirmed that Dynetics’ protest and Blue Origin’s protest and lawsuit have delayed SpaceX’s first crewed Starship Moon landing to no earlier than (NET) 2025.
Painfully, though, the briefing primarily focused on NASA’s Space Launch System (SLS) rocket and Orion spacecraft and the latest news about the system and the space agency’s attitude towards it are not encouraging.
Namely, exemplifying just how broken and deceptive NASA’s cost “transparency” is when it comes to SLS and Orion, the space agency used the briefing to announce its first updated Orion cost projections in more than half a decade. All the way back in September 2015, NASA announced major Orion delays and revealed that it had already spent $4.7B on the spacecraft and was committing another $6.7B through its first crewed launch – then scheduled no earlier than 2023.
That’s likely where NASA is getting its magically diminished Orion cost estimate. In reality, including Bush-era Constellation Program development that began in 2006, Orion will have cost NASA and the US taxpayer almost $22 billion by the end of 2021 and before a single full-up launch. Effectively doing the bare minimum to acknowledge a sanitized version of reality, NASA now says that Orion will cost at least $9.3 billion to its first crewed launch, which has been delayed to NET May 2024. It’s entirely unclear how NASA is calculating that deflated figure but in the six years since the space agency’s 2015 announcement that it would spend another $6.7B before Orion’s first crewed launch, it’s actually spent at least $8.4B and will have blown past the latest $9.3B target by mid-2022. Barring drastic funding cuts, Orion development will actually cost the US about $12.6B from 2016 to Artemis II and ~$25.8B since 2006 (not including inflation).
In an even starker demonstration of cognitive dissonance, when a New York Times reporter asked a hard question about the possibility of sidestepping Orion and SLS to get astronauts onto SpaceX’s Starship lunar lander, Administrator Nelson – having just repeatedly discussed Starship – fell back on an old boilerplate statement that “there’s only one rocket capable of doing this” – “this” being launching humans to the Moon and returning them to Earth and that “one rocket” being SLS. Association admin Jim Free also exhibited similar confusion, stating that “the architecture…just wouldn’t work.”
In reality, as currently contracted with NASA, SpaceX’s Starship Moon lander is a highly capable crewed spacecraft that will be refueled in Earth orbit before propelling itself to lunar orbit, where an SLS-launched Orion spacecraft would join it and transfer over three astronauts. Starship would then use its own propulsion to change orbits, land on the Moon, and eventually boost back into lunar orbit to transfer that crew back to Orion for the return to Earth. Nothing short of sheer ignorance – willful or not – could prevent competent spaceflight engineers or managers from understanding the possibilities such an architecture raises.
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If NASA is already committed to human-rating Starship’s propulsion systems, which it is, it doesn’t take a grand leap of imagination to consider the possibility of adding a few more burns to Starship’s extremely complex concept of operations. If, for example, Starship has enough performance to return to Earth orbit from the lunar surface, it’s not hard to imagine NASA’s Artemis astronauts boarding Starship in Earth orbit after a far cheaper commercial launch and then returning to Earth orbit to debark Starship and return to that crew-rated reentry vehicle. As it turns out, NASA already has a highly successful crew-rated commercial rocket and spacecraft that’s already operational and likely more than 10 times cheaper than SLS/Orion.
While there are obvious challenges and uncertainties with such an option, the point is more that failing to even acknowledge the possibility of alternatives is a brutal appraisal of several of NASA’s most senior leaders and confirms that the politics of a jobs program like SLS/Orion is actively disrupting their ability to engage with reality and properly manage complex, risky programs.
Ultimately, it’s great news that SpaceX and NASA can finally get back to work on their Starship Moon lander plans. However, it’s also clearer than ever that SLS and Orion will remain a noose precariously balanced around the agency’s neck, forever threatening the Artemis Program and stifling NASA’s ability to seriously plan for – let alone publicly entertain or even acknowledge – contingencies or fresh ideas.
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.
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.
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.
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.
Elon Musk
Another Tesla SpaceX merger prediction by ARK Invest has Elon Musk talking
Elon Musk again denies a Tesla China split as new SpaceX merger speculation resurfaces quickly.
Elon Musk restated that Tesla has no plans to separate its China business from the rest of the company, responding to a new round of merger speculation from ARK Invest.
On the firm’s “Brainstorm” podcast, Cathie Wood’s team, including chief futurist Brett Winton and research director Nick Grous, argued a Tesla and SpaceX combination remains likely, with an announcement possible before the end of the year even if the deal itself would not close that quickly. Winton called Tesla’s Shanghai operations a “small ish wrinkle” for a merger rather than a real obstacle, since SpaceX’s national security work with the U.S. government sits uneasily next to Tesla’s manufacturing base in China.
Musk pushed back on the framing directly. “China is awesome. I strongly encourage people to visit,” he wrote on X. He also repeated language he first used in late July, when the Wall Street Journal reported that Tesla executives had been told to prepare for a possible spinoff, sale, or closure of the China business ahead of a SpaceX tie up. Musk called that report “absurdly fake news” at the time, adding that a separation had “never even come up in a discussion ever,” a line he echoed again this week.
The repeated denial has not settled the underlying question, because Shanghai’s role in Tesla’s business is exactly what makes a merger complicated. Gigafactory Shanghai still ships more than half of Tesla’s global deliveries and functions as the company’s main export hub for Europe and Asia. Teslarati previously reported on Musk’s initial denial, and the merger conversation itself has been building since SpaceX’s IPO gave it public shares to use as acquisition currency.
Wedbush’s Dan Ives has pegged the odds of a Tesla SpaceX merger at 80 to 90 percent by early 2027, and ARK’s prediction of a year end announcement adds another data point to that timeline, even as Musk keeps rejecting the specific mechanics reporters have described. Neither position rules out the other. Musk can deny a China spinoff was ever discussed while analysts still expect some form of combination to move forward, since ARK and Ives are both describing convergence at the corporate level, not necessarily the internal restructuring the Journal described in July.
For now, Tesla’s China business remains intact, and Musk’s comments this week make clear he has no interest in publicly walking that position back, no matter how often the merger question resurfaces.
SpaceX AI investment gamble will make it a big winner, firm says
Tesla headlights cause recall of over 20,000 Model 3 and Model Y
