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SpaceX sends “radically redesigned” Starship engine to Texas for hot-fire tests
SpaceX has shipped one of the first of a group of Starship engines known as Raptor, described last month by CEO Elon Musk as “radically redesigned”. A culmination of more than 24 months of prototype testing, the first flight-worthy Raptor could be ignited for the first time as early as February.
According to Musk, three of these redesigned Raptors will power the first full-scale BFR prototype, a Starship (upper stage) test article meant to conduct relatively low-altitude, low-velocity hop tests over the southern tip of Texas. Those tests could also begin next month, although a debut sometime in March or April is increasingly likely.
Engines currently on Starship hopper are a blend of Raptor development & operational parts. First hopper engine to be fired is almost finished assembly in California. Probably fires next month.
— Elon Musk (@elonmusk) January 5, 2019
Effectively designed on a blank slate, Raptor began full-scale component-level tests in 2014 at NASA’s Mississippi-based Stennis Space Center, evolving from main injector development to oxygen preburner hot-fires in 2015. Soon after Raptor’s prototype preburner design was validated at Stennis, SpaceX moved testing to its privately-owned and operated facilities in McGregor, Texas, where Raptor static fire testing has remained since.
Mach diamonds pic.twitter.com/TCX7ZGFnN0
— Elon Musk (@elonmusk) September 26, 2016
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Just days before CEO Elon Musk was scheduled to reveal SpaceX’s next-generation rocket (BFR, formerly known as the Interplanetary Transport System or ITS) in September 2016, he announced in a tweet that propulsion engineers and technicians had successful hot-fired an integrated Raptor prototype – albeit subscale – for the first time ever. Just 12 months later, Musk once again took to the stage to announce an update to BFR’s design, while also revealing that prototype Raptor engines had already completed more than 1200 seconds (20 minutes) of cumulative hot-fire tests, an extremely aggressive and encouraging rate of progress for such a new engine.
SpaceX has completed over 1,200 seconds of firing across 42 main Raptor engine tests. pic.twitter.com/EhxbPjd8Cj
— SpaceX (@SpaceX) September 29, 2017
Although Raptor undoubtedly borrows heavily from much of the same expertise that designed Merlin 1 and operated and improved it for years, that is roughly where the similarities between Raptor and M1D end. M1D, powered by refined kerosene (RP-1) and liquid oxygen, uses a combustion cycle (gas-generator) that is relatively simple and reliable at the cost of engine efficiency, although SpaceX propulsion expertise still managed to give M1D the highest thrust-to-weight ratio of any liquid rocket engine ever flown. Still, measured by ISP (instantaneous specific impulse), M1D’s inefficient kerolox gas-generator cycle ultimately means that the engine simply can’t compete with the performance of engines with more efficient propellants and combustion cycles.
While SpaceX’s Falcon 9 and Heavy rockets – powered by Merlin 1D and Merlin Vacuum – are more than adequate in and around Earth orbit, a far more efficient engine was needed for the company to enable the sort of interplanetary colonization Musk had in mind when he created SpaceX. Raptor was the answer. Ultimately settling on liquid methane and oxygen (methalox) as the propellant and a full-flow staged-combustion (FFSC) cycle, Raptor was designed to be extraordinarily reliable and efficient in order to safely power a spacecraft (BFS/Starship) meant to ferry dozens or hundreds of people to and from Mars.
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- The only official render of Raptor, published by SpaceX in September 2016. The Raptor departing Hawthorne in Jan ’19 looked reasonably similar. (SpaceX)
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- SpaceX technicians wrench on Merlin 1D and Merlin Vacuum engines. Raptor was apparently dramatically larger in person. (SpaceX)
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- Starhopper’s Raptors feature a very distinct seam and second curve, indicative of a dual-bell nozzle. (NASASpaceflight /u/bocachicagal)
Raptor enters a new era
For all the extensive and invaluable testing SpaceX has done with a series of prototype Raptor engines, the engines tested were subscale versions with around 30% the thrust of the c. 2016 Raptor and around 40-50% of the updated c. 2017 iteration, producing almost the same amount of thrust as Merlin 1D (914 kN to Raptor’s ~1000 kN). In September 2018, Musk described Raptor as an “approximately…200-ton (~2000 kN) thrust engine” that would eventually operate with a chamber pressure as high as 300 bar (an extraordinary ~4400 psi), requiring at least one of the FFSC engine’s two preburners (used to power separate turbopumps) to operate at a truly terrifying ~810 bar (nearly 12,000 psi).
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Conveniently stood beside a Merlin 1D engine also ready for hot-fire acceptance testing, the Raptor engine spotted departing SpaceX’s Hawthorne, CA factory last week was reportedly immense in person, towering over an M1D engine. Raptor also featured a mass of spaghetti-like plumbing (complexity necessary for its advanced combustion cycle), with a significant fraction of the metallic pipes and tubes displaying mirror-like finishes. Most notable was an obvious secondary preburner/turbopump stack and the lack of any exhaust port, whereas M1D relies on a single turbopump and exhausts the gases used to power it. Raptor’s full-flow staged-combustion cycle uses separate oxygen and methane preburners to power separate turbopumps, significantly improving mass flow rate and smoothing out combustion mixing.
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- SpaceX’s current Texas facilities feature a test stand for Raptor, the engine intended to power BFR and BFS to Mars. (SpaceX)
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- SpaceX’s subscale Raptor engine has completed more than 1200 seconds of testing in less than two years. (SpaceX)
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- A gif of Raptor throttling over the course of a 90+ second static-fire test in McGregor, Texas. (SpaceX)
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- A September 2018 render of Starship (then BFS) shows one of the vehicle’s two hinged wings/fins/legs. (SpaceX)
Unlike all previous hot-fired Raptors, those shipping now to McGregor, Texas are expected to be the first completed engines with a finalized design, arrived at only after a period of extensive testing and iterative improvement. They also appear to be full-scale, meaning that the test bays dedicated to Raptor will likely need to be upgraded (if they haven’t been already) to support a two- or threefold increase in maximum thrust.
Yes. Radically redesigned Raptor ready to fire next month.
— Elon Musk (@elonmusk) December 22, 2018
SpaceX’s Starship hopper will need three finalized engines, meaning that the Raptor now in McGregor, Texas may not have been the first to arrive. Nevertheless, the shipment of full-scale hardware is always an extremely encouraging milestone for any advanced technology development program, while also foreshadowing the first imminent static-fires of the “radcally redesigned” rocket engine. With hardware now at the test site before January is out, a February test debut – one month behind a January debut teased by Elon Musk last December – is not out of the question.
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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
