Rocket Explosion Will Cost Elon Musk $120 Million
Major rocket manufacturer SpaceX will likely lose $120 million dollars due to a rocket explosion earlier this month, according to new estimates.
The Space Frontier Foundation (SFF) estimated how much SpaceX must spend to replace the lost rocket, factoring in future revenue from reusing the booster and the costs of repairing the launch pad. Owned by beleagured billionaire Elon Musk, the company could be hit with a $50 million dollar lawsuit from the telecommunications company whose satellite the rocket explosion destroyed. SpaceX declined comment to Forbes on the accuracy of SFF estimates.
SpaceX’s Falcon 9 rocket, worth $60 million, was carrying a $200 million satellite to provide phone, video and internet services for the Middle East, Europe, and locations across sub-Saharan Africa. The cause of the explosion is still unknown, but an investigation has revealed the accident likely began with a failure in the the rocket’s upper stage oxygen tanks.
Industry experts believe the explosion could have been caused by a fuel leak, unknown contaminants in the liquid oxygen propellant, or a problem with rocket staging. Until the cause of the explosion is known, Musk will have a harder time finding new clients and is risking a serious financial loss with each new launch, potentially driving customers to United Launch Alliance [ULA] and SpaceX’s other business rivals.
“As far as SpaceX’s reputation with NASA/DoD/etc, it’s too soon to say the failure itself will have an adverse effect,” Bill Ostrove, an aerospace analyst for Forecast International, told Forbes. “For future national security launches, the DoD may prioritize responsiveness and reliability over price, giving ULA an advantage in future competitions.”
SpaceX rockets have previously exploded several times during landing attempts, which Musk called a “huge blow.” Currently, SpaceX has nine more scheduled launches this year. After the company’s last launch failure, it took nearly six months before Falcon 9 launches were resumed. ULA employees have estimated that it could take up to a full year to resume launches.
SpaceX may not be able to afford to take a year off, as the company currently has $330 million invested in SolarCity, Musk’s rooftop solar company. SolarCity is a sizable investment for SpaceX, which was valued at $12 billion in 2015, leaving the company with little cash on-hand and no revenue stream if launches are paused.
SpaceX plans to use a similar rocket to launch a human into space in October, 2017, but setbacks are possible due to the explosion. The company is currently racing Boeing to be the first private company to send humans to the International Space Station. SpaceX and Boeing, along with other companies, have made huge advancements in reusable rocketry, which has the potential to greatly reduce the costs of getting into space.
Send tips to andrew@
Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact firstname.lastname@example.org.