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SpaceX wins US Air Force contract for Falcon Heavy launch
In an unexpected bode of confidence in the nascent vehicle, SpaceX has competed for and won a $130 million US Air Force launch contract for the massive Falcon Heavy rocket. While not planned to occur until September 2020 at the earliest, the most critical aspect of this development is the fact that the USAF has apparently already certified Falcon Heavy for high-value military launches.
The almost knee-jerk certification of Falcon Heavy for USAF launches makes for an extraordinary contrast when compared with the certification of SpaceX’s Falcon 9 workhorse rocket, a tedious political minefield that took more than two years, led SpaceX to (successfully) sue the federal government, and forced the Air Force to critically reexamine its internal processes after they delayed SpaceX’s certification by six or more months. For that particular endeavor, the USAF required SpaceX to complete three successful Falcon 9 launches, while also preventing SpaceX from engaging in launch contract competitions until their launch vehicle was certified in May 2015.
#SpaceX has won a competitively-awarded #AirForce launch contract for the AFSPC-52 flight. The mission will utilize a #FalconHeavy rocket. Mission will launch by Sept. 2020 from LC-39A at Kennedy Space Center. Statement from Gwynne Shotwell below… pic.twitter.com/a5ka2ov20L
— Chris G (@ChrisG_SpX) June 21, 2018
Jump ahead to 2018 and SpaceX appears to have been allowed to compete for this particular mission – known cryptically as AFSPC-52 – before Falcon Heavy had so much as completed an integrated static fire test. The awe-inspiring rocket did, however, complete a nearly-flawless debut launch in February 2018, a mission that required the company’s Falcon upper stage to survive a lengthy (6+ hour) coast in orbit before igniting its Merlin vacuum engine for one final burn. Regardless of the specifics, many of which have likely been kept under wraps, the Air Force must have been quite impressed with the rocket’s debut performance, and Falcon Heavy has now – according to President and COO Gwynne Shotwell – been certified for USAF missions just four months later.
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- Falcon 9 Block 5 completed its first launch on May 11, carrying the Bangabandhu-1 communications satellite to geostationary transfer orbit. (Tom Cross)
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- Falcon Heavy clears the top of the strongback in a spectacular fashion. Two of the rocket’s three manifested missions are now for the USAF. (Tom Cross)
It’s somewhere between difficult and impossible to accurately compare the different payloads and launches of the Air Force Space Command (AFSPC), but SpaceX’s only competitor ULA was awarded a contract for the launch of two relatively different AFSPC payloads at an average (fixed) cost of $175 million per mission. Those satellites were likely much smaller than AFSPC-52 but they require direct insertion into geostationary orbit (GEO), whereas AFSPC-52 may instead be sent to a geostationary transfer orbit (GTO) before circularizing the orbit under its own power.
Still, SpaceX’s triple-booster Falcon Heavy launch contract will cost the USAF a slim $130m. It’s worth noting that the 2018 AFSPC-8 and -12 contracts awarded to ULA were for the company’s single-booster Atlas 5 rocket, with most of the draw coming from its admittedly advanced, efficient, and extraordinarily reliable Centaur upper stage, tasked with reigniting repeatedly to circularize the orbit of its valuable satellite payloads once in space.
While it requires far less rigor than the Air Force’s more secretive, national security-sensitive satellite launches, SpaceX’s second Falcon Heavy launch – this time with three highly-reusable Block 5 boosters – will also be conducted with the military branch as the primary customer. Known as Space Test Mission-2 (STP-2), Falcon Heavy will be tasked with carrying a stack of dozens of different smallsats to a variety of orbits. Of note, the vast majority of that mission’s payload comes in the form of a 5000-kilogram ballast mass, included because the mission was manifested on Falcon Heavy (instead of the operational Falcon 9) for the sole purpose of facilitating the rocket’s rapid certification for critical Air Force missions.
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- Falcon Heavy may look for more condensed than Delta Heavy, but its performance dramatically outclasses the ULA rocket in all but the highest-energy mission profiles. (SpaceX)
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- The fully-integrated Falcon Heavy rolls out to Pad 39A. For vertical integration, think of this… but vertical. (SpaceX)
STP-2 is currently scheduled for no earlier than (NET) November 2018, while the third launch of Falcon Heavy – the commercial Arabsat 6A communications satellite – is tentatively targeted for December, although it’s almost guaranteed to slip into Q1 2019.
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Tesla stock (NASDAQ: TSLA) closed at an all-time high on Tuesday, jumping over 3 percent during the day and finishing at $489.88.
The price beats the previous record close, which was $479.86.
Shares have had a crazy year, dipping more than 40 percent from the start of the year. The stock then started to recover once again around late April, when its price started to climb back up from the low $200 level.
This week, Tesla started to climb toward its highest levels ever, as it was revealed on Sunday that the company was testing driverless Robotaxis in Austin. The spike in value pushed the company’s valuation to $1.63 trillion.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
It is the seventh-most valuable company on the market currently, trailing Nvidia, Apple, Alphabet (Google), Microsoft, Amazon, and Meta.
Shares closed up $14.57 today, up over 3 percent.
The stock has gone through a lot this year, as previously mentioned. Shares tumbled in Q1 due to CEO Elon Musk’s involvement with the Department of Government Efficiency (DOGE), which pulled his attention away from his companies and left a major overhang on their valuations.
However, things started to rebound halfway through the year, and as the government started to phase out the $7,500 tax credit, demand spiked as consumers tried to take advantage of it.
Q3 deliveries were the highest in company history, and Tesla responded to the loss of the tax credit with the launch of the Model 3 and Model Y Standard.
Additionally, analysts have announced high expectations this week for the company on Wall Street as Robotaxi continues to be the focus. With autonomy within Tesla’s sights, things are moving in the direction of Robotaxi being a major catalyst for growth on the Street in the coming year.
Elon Musk
Tesla needs to come through on this one Robotaxi metric, analyst says
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Tesla needs to come through on this one Robotaxi metric, Mark Delaney of Goldman Sachs says.
Tesla is in the process of rolling out its Robotaxi platform to areas outside of Austin and the California Bay Area. It has plans to launch in five additional cities, including Houston, Dallas, Miami, Las Vegas, and Phoenix.
However, the company’s expansion is not what the focus needs to be, according to Delaney. It’s the speed of deployment.
The analyst said:
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Profitability will come as the Robotaxi fleet expands. Making that money will be dependent on when Tesla can initiate rides in more areas, giving more customers access to the program.
There are some additional things that the company needs to make happen ahead of the major Robotaxi expansion, one of those things is launching driverless rides in Austin, the first city in which it launched the program.
This week, Tesla started testing driverless Robotaxi rides in Austin, as two different Model Y units were spotted with no occupants, a huge step in the company’s plans for the ride-sharing platform.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
CEO Elon Musk has been hoping to remove Safety Monitors from Robotaxis in Austin for several months, first mentioning the plan to have them out by the end of 2025 in September. He confirmed on Sunday that Tesla had officially removed vehicle occupants and started testing truly unsupervised rides.
Although Safety Monitors in Austin have been sitting in the passenger’s seat, they have still had the ability to override things in case of an emergency. After all, the ultimate goal was safety and avoiding any accidents or injuries.
Goldman Sachs reiterated its ‘Neutral’ rating and its $400 price target. Delaney said, “Tesla is making progress with its autonomous technology,” and recent developments make it evident that this is true.
Investor's Corner
Tesla gets bold Robotaxi prediction from Wall Street firm
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Tesla (NASDAQ: TSLA) received a bold Robotaxi prediction from Morgan Stanley, which anticipates a dramatic increase in the size of the company’s autonomous ride-hailing suite in the coming years.
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Percoco dug into the Robotaxi fleet and its expansion in the coming years in his latest note, released on Tuesday. The firm expects Tesla to increase the Robotaxi fleet size to 1,000 vehicles in 2026. However, that’s small-scale compared to what they expect from Tesla in a decade.
Tesla expands Robotaxi app access once again, this time on a global scale
By 2035, Morgan Stanley believes there will be one million Robotaxis on the road across multiple cities, a major jump and a considerable fleet size. We assume this means the fleet of vehicles Tesla will operate internally, and not including passenger-owned vehicles that could be added through software updates.
He also listed three specific catalysts that investors should pay attention to, as these will represent the company being on track to achieve its Robotaxi dreams:
- Opening Robotaxi to the public without a Safety Monitor. Timing is unclear, but it appears that Tesla is getting closer by the day.
- Improvement in safety metrics without the Safety Monitor. Tesla’s ability to improve its safety metrics as it scales miles driven without the Safety Monitor is imperative as it looks to scale in new states and cities in 2026.
- Cybercab start of production, targeted for April 2026. Tesla’s Cybercab is a purpose-built vehicle (no steering wheel or pedals, only two seats) that is expected to be produced through its state-of-the-art unboxed manufacturing process, offering further cost reductions and thus accelerating adoption over time.
Robotaxi stands to be one of Tesla’s most significant revenue contributors, especially as the company plans to continue expanding its ride-hailing service across the world in the coming years.
Its current deployment strategy is controlled and conservative to avoid any drastic and potentially program-ruining incidents.
So far, the program, which is active in Austin and the California Bay Area, has been widely successful.
Tesla stock closes at all-time high on heels of Robotaxi progress
Tesla needs to come through on this one Robotaxi metric, analyst says
