U.S. Engine Suppliers Vie to Power Pentagon's Space Rockets

By Doug Cameron 

The Pentagon's main supplier of space rockets will decide by 2017 between two contenders vying to replace the Russian-made engines that send most military and intelligence satellites into orbit, while preparing for competition in the market from Elon Musk's SpaceX.

The United Launch Alliance LLC joint venture between Boeing Co. and Lockheed Martin Corp. last year said it would explore using an engine being developed by Blue Origin LLC, the company run by Amazon.com Inc.'s founder and chief executive, Jeff Bezos. ULA is also examining a new engine being developed by Gencorp Inc.

Tory Bruno, ULA's chief executive, told a congressional hearing on Tuesday that the engine being developed by Gencorp's Aerojet Rocketdyne unit was one-to-two years behind Blue Origin, but his company plans to choose between the two in 2016 or 2017.

The U.S. Air Force has requested proposals for a new U.S.-built rocket engine, spurred by concerns that escalating tensions with Russia could choke off supplies of the RD-180 used on many ULA launches. The engine is imported from Russia's state-controlled NPO Energomash OAO and was adopted in the 1990s because of its low cost and reliability.

Mr. Musk's Space Exploration Technologies Corp. has spent three years pursuing Pentagon work with its own Falcon rocket, which is powered by an engine developed in house. The Falcon is expected to be certified for military work by June, and a larger version would be available in 2016, allowing it to compete for all Pentagon business.

SpaceX sparred last year with ULA and the Air Force over what it said was as an unfair deal that gave the bulk of sensitive satellite launch business to the joint venture. SpaceX sued the Pentagon before settling the suit earlier this year. ULA has held a monopoly on sensitive launches through a multiyear deal worth around $11 billion.

Gwynne Shotwell, president of SpaceX, said at the hearing that it would be able to undercut ULA on cost, though Mr. Bruno said the joint venture was taking steps to reduce its own expenses.

Lawmakers have told ULA it won't be able to acquire any more Russian engines beyond its current contracted supply, a move that could leave it without a propulsion system around 2019, when Congress wants a domestic replacement to be available.

Air Force leaders said this may be challenging. "I'm not sure 2019 is doable," Air Force Secretary Deborah Lee James told a Congressional hearing last month.

Write to Doug Cameron at [e-mail]

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