Musk was addressing not the performance penalty, but the issue of fuel cost, which is a non-issue in the overall economics of reusability. Reserving fuel in the first stage for landing adds mass to the vehicle and deprives it of performance, effectively carrying fuel instead of extra payload - a penalty that expendable rockets do not need to pay. Musk said the fuel used on a Falcon 9 is between $200,000 and $300,000. “There are ongoing challenges in translating a reused rocket to tangible capex savings – worries about it failing, insurance implications, retrofitting turnaround, building up a critical mass of reused first stages in the warehouse,” Jefferies said. If SpaceX gave customers 100 percent of the savings, the launch price would drop by up to 40 percent, to $37 million. If SpaceX passed on to its customers 50 percent of the cost savings, the company could reduce today’s Falcon 9 price by 21 percent, to $48.3 million, Jefferies concludes. Musk has said the first-stage engine could be reused dozens of times.

If the 40 percent gross-margin estimate were correct, that would mean a total first-stage cost of $27.5 million. SpaceX founder Elon Musk has said the first stage accounts for about 75 percent of the total vehicle cost. Conclusion: between 21 and 40 percent from current prices. Investment analysts at Jefferies have made a disinterested attempt to look at what satellite fleet operators might expect in savings. Confusing and occasionally contradictory statements about the cost savings to SpaceX - and to its customers -derived from multiple reuse of the Falcon 9 rocket’s first stage has made it difficult to forecast reusability’s impact. This includes the costs of the fueled rocket, and of launch campaign. In an April 25 report, Jefferies takes the $61.2 million list price for a Falcon 9 launch and assumes SpaceX makes a gross margin of 40 percent on the launch, leaving a direct per-launch cost to SpaceX of $36.7 million. The latest is from Jefferies International LLC.

The interest of SES, a publicly traded company, in rocket reuse has set in motion analyses by investment banks covering the commercial satellite telecommunications industry. SES has said repeatedly it is willing to be the inaugural customer for a reused first stage, but would like the price to move closer to $30 million, at least for the first flight. When measured by contract volume, SpaceX’s biggest customer is SES of Luxembourg. If this translated into a 30 percent price reduction to customers, that would drop Falcon 9’s advertised price to $42.8 million from today’s $61.2 million. In March, SpaceX President Gwynne Shotwell said the company could expect a 30 percent cost savings from reusing the first stage. Outsiders are left with piecing together what they can, based on SpaceX’s public statements. SpaceX is a privately held company that does not publish its financial statements, making a detailed cost analysis difficult. But his caution related not to the fact of landing safely, but to the economics of refurbishment. I want to be realistic: We are not as smart as we think we are and we don’t understand the environment as well as we think we do.”ĭumbacher was speaking in April 2014, before Hawthorne, California-based SpaceX succeeded in landing the Falcon 9 first stage, first in December on a pad near the launch site, and then during the April 8 mission. Look how long and how much money it took for us to do that, and we still weren’t completely successful for all the parts.

“We tried to make them reusable for 55 flights. “The SSMEs were reusable,” Dan Dumbacher, former NASA deputy associated administrator for exploration systems development, said of the space shuttle main engines. But after beating their heads against the problem for years, they also would say it’s much more difficult than hopping back into your car. NASA engineering veterans of the space shuttle would surely agree about its being fundamental. “It’s just as fundamental in rocketry as it is in other forms of transport – such as cars or planes or bicycles,” Musk said in a post-launch briefing.