To help the company evolve, ULA President Tory Bruno has launched a series of initiatives to lower costs and develop a new vehicle. In a March interview, he laid out how he plans to keep his company competitive for the next 20 years of military space launch.
Q. Give us an update on the new rocket engine and vehicle you have planned.
A. That will be the fun thing that you can see at the Space Symposium. We have been talking a lot about the engine because that is the focus, but what we're actually going to put the engine underneath is a whole new rocket and so we'll show you the entire architecture that transforms the launch vehicle in steps. Not all at once, because we have to get the new rocket engine underneath, we want to bring in additive manufacturing and we also want to do some very exciting things with the upper stage. We currently have a high-energy upper stage, which is one of the things that is different between us and competitors that allows us to do things like the interplanetary missions and more complex insertions of spacecraft in various orbits. We think there is going to be even more demand for that going forward.
Q. Does this replace Atlas V and Delta IV entirely?
A. We'll take those two birds and transition them to the next-generation launch system. What I'm going to show people is a vision that takes us well out into the 2030s. We are going to be continually improving and evolving that new launch system. The engine is the most urgent, and that is what we can afford to do. First we'll be doing the booster with the new engine and then something exciting with the upper stage, and then you'll see two or three more things that come after that.
Q. You've talked about changing your infrastructure. What's an example?
A. We are not just modifying the pads for the new rocket; I also want to reduce the number of pads that we have and make the pads themselves more advanced and more versatile. We have five pads. I would like to go all the way down to two, one on the West Coast and one on the East Coast, and I intend for them to have the same volume, or even higher, than today. That means we have to be able to do the launch operations more than twice as fast, and the pads, therefore, also have to be what we call mission-agnostic.
Normally a pad is pretty rigidly configured for both the rocket and the type of payload that the rocket would typically carry, and if you were to come up with a very different kind of mission — today, that is a hard thing to do. What we're going to do is have pads that are so flexible they don't care, so whatever rocket we're flying at the time can go on there. We won't want to care what kind of mission it is.
Q. You expect to have all those trades figured out this year?
A. Yes. We're going to do all of these really exciting things with the pad that give us all this flexibility and take all this infrastructure cost out. The most significant set of infrastructure costs we have is in the pads themselves, so by coming down to two and having all this flexibility, we launch much quicker, we can be much more flexible with customers coming in with different kinds of payloads. They are not quite done with those. We'll finish those trades up later, and roll out the new pads later in the year.
Q. What has changed that allows you to do these new pads now?
A. We are going to bring some of the new construction techniques online. We are actually building the pad off-site in pieces and then assembling it between missions, like a big erector set, so that you don't have to interfere with the launches going on now to build the pad. Normally you would shut a pad down for two years when you build a major tower next to it. It will be things like that — novel approaches to construction and designing with the intent to flexibility ahead of time.
Q. You've talked about wanting to drive new business models. What does that mean, in real terms?
A. We'll be introducing something we call our commercial pricing model or our commercial business model. There will be a big rollout later in the year. It will have a standard launch service offering, and that will be the basic rocket offered at a fixed price with the basic kinds of service that come with it. A commercial customer, for example, has different testing levels that they will demand. They will have different insights that they demand.
When you go to a typical government customer like the Air Force, they want more. Because of the critical nature of their payloads they might ask for more margins in the testing they do. They ask for a lot more disclosure of the designs, of the technical details of how we spend their money — every penny is accounted for. Our concept is we are going to have a basic offering and line the bulk of our company up around that. Then we'll have different program offices for custom services. We'll organize what they typically want into packages that they can buy separately, again at a fixed price that they will add to that.
The vision is they can really do their own trades and understand what it is going to cost before they even call us up and start working with us. They are a lot closer to knowing what they can do. I am excited for what it will do for the commercial customers, but I'm actually really excited at how I think it is going to empower the government customers. Normally, a government customer comes to us like they do anybody else with a big book of requirements, and we sit down together over a span of weeks and we build up a design. Every time it is different. If you get to where you are done and maybe the price isn't what they want and they try to pull it back apart to see what drove it, it is really complicated and hard to do. This will make it so much easier for them.
Q. Are there changes you would like to see made to how military space launch is procured?
A. Yes, there are. There is always opportunity to improve. I think the time is here for industry to really lead that change, and so this business model I described really has an eye to empowering the government and facilitating them moving to a different model, where they can still feel they are not really taking on more risk but they are able to procure faster and therefore less expensively. It is not just the money they spend on the provider. A lot of resources go into setting up the proper procurement in acquisition and executing it. With the model I'm talking about, I think the government will be able to spend less money on their part of that procurement as well, and speed is always good. Time really is money. The longer it takes you to do something, typically, the more it costs.
Q. This is a lot of internal investment. How are you balancing that with the need to drive a profit?
A. It limits how fast we can do all these things. If we had unlimited resources or we were in a pre- [initial public offering] model — not to mention any names — you wouldn't need to earn profit. You could just take investment dollars and plow it all back into this stuff and we would go faster. We are a mature company so I have to return a profit to the two owners of the company. We are sort of a conventional company in that we get the investment to do this work from profit, so first we have to earn profits and then we siphon the money off to go do this work, and so that limits what we can do.
Q. You seem to want to grow the commercial side of the business. What is your business split now, and where will it be in a decade?
A. Today it is more than two-thirds national security space, and in five to eight years it is going to invert the other way around. If you were to check in on us in the back half of the 2020s [after an expected dip in military space launch], it would be more like 50/50.
Aaron Mehta was deputy editor and senior Pentagon correspondent for Defense News, covering policy, strategy and acquisition at the highest levels of the Defense Department and its international partners.