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MEXICO: Most businesses are more straightforward than rocket science. Resupplying the International Space Station is not one of them. But plenty of companies are up for the challenge – there has been a proliferation of private space companies in the US over the past decade. Nasa will award space station resupply contracts worth billions of dollars later this year. But both frontrunners – privately owned SpaceX and publicly traded Orbital ATK – have recently suffered rocket crashes (or “total mission failure”, to use the technical term). SpaceX and Orbital won the last resupply contest; this autumn they will face competition from rivals such as Boeing and privately owned Sierra Nevada. Nasa can choose as many winners as it likes.
Whoever wins will have to face the brutal realities of space: the technical challenges, the risk of public failure – and the slender margins left at the end. A good example is the United Launch Alliance, a joint venture between Boeing and Lockheed Martin, which touts a perfect safety record. Until recently it held a monopoly on launches for US military satellites, a lucrative niche. Even so, its pre-tax operating profit was just $US420m in 2014 – it is a small business in the context of its parent companies. Under pressure from SpaceX, ULA has been restructuring to cut costs.
