STRATEGIC TECHNOLOGY ROADMAP: SPACE EXPLORATION TECHNOLOGIES CORPORATION ANDERS HANSEN | ANNA-MARIA CRNJAK | BENJAMIN TEE | RICHARD AVENARIUS
PREPARED FOR: DR CHARLES WEBER
11 DECEMBER 2013
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INTRODUCTION
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Longtime interest in space
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Mission to MARS
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Developed strategic partnership with NASA
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Heavily invested in aerospace technology R&D instead of purchasing Russian ICBMs.
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QUICK FACTS ABOUT SPACE X:
FOUNDED
VEHICLES
MANIFEST
EMPLOYEES
2002
3
40+
3,000+
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THE LAUNCH INDUSTRY
HISTORICAL OVERVIEW COMMERCIAL AEROSPACE INDUSTRY
2000 Present
• • •
Military Civil Commercial
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) Mobile Telecommunications Geographic Positioning Systems (GPS)
1990’s
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1980’s
• •
Television Broadcasting US government national space policy
INDUSTRY OVERVIEW SEGMENTATION AND BREAKDOWN SPACE SERVICES 2012 Global Revenue:
SATELLITE MANUFACTURING
GROUND EQUIPMENT
LAUNCH SERVICES
2012 Global Revenue:
$54,8b
2012 Global Revenue: $6,5b
$190b
2012 Global Revenue: $14,6b
Largest segment. Consumer Services = biggest driver of growth
U.S. market share ≈ 60% of global market
Consumer & Network equipment
U.S. market share = 35% of global market
7% growth rate from 2011-2012
23% growth rate from 2011-2012
4% growth rate from 2011-2012
35% growth rate from 2011-2012
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PORTER’S FIVE FORCES ANALYSIS LAUNCH INDUSTRY Competitive Rivalry Medium: Several large big players in the industry
Threat of Entrants
Supplier Power Medium: Specialized Manufacturers of parts
Buyer Power Medium: Price sensitive, Reliability sensitive customers
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Low: High barriers to entry
Threat of Substitutes Low: Specialized product, High Technology
Conclusion: Presence of large, established competitors due to barriers to entry. Price and reliability are key factors!
DEVELOPMENTS WITHIN THE LAUNCH INDUSTRY FROM PUBLIC TO PRIVATE PUBLIC SECTOR
PRIVATE SECTOR •
The Space Act
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Major Cost Savings – SpaceX was able to launch a vehicle into space for 1/3 the cost of NASA.
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Increased national
Agreements – Allows for increase in innovation and development of aerospace tech.
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– Allows efficiency in corporate business & scientific research Rapid development in monetization of revenue
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sovereignty – U.S. – Russia relationship [≠]
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COMPANY HIGHLIGHTS
MISSION AND LONG TERM VISION - SPACEX Mission: • To develop space transportations, with the ultimate goal of making it possible for humans to live on other planets
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Future Vision: • Give costumers lower prices and faster launch tempo • Creating reusable aircrafts for space travel • Continuing to apply innovative ideas and ground-breaking research
SWOT ANALYSIS - SPACEX
S
W
O
T
Strengths: • Low cost, high reliability business model • In-house manufacturing of rockets • Innovation philosophy • Young & talented workforce & CEO • Able to provide services internationally ) • Pioneer in development of reusable rockets • Free from political influence Weaknesses: • New entrant in complex & competitive business environment • Limited funding as a privately company
SWOT ANALYSIS - SPACEX
S
W
Opportunities: • Falcon Heavy set to be the world’s most powerful rocket by payload • Reusable Dragon capsule set to be first private crew spacecraft to visit ISS • Set to be market leader in reusable rockets )
O
T
Threats: • Changes to legal and political environment • Loss of confidence in event of mission failure • Failure to deliver flight manifest on schedule
SPACEX RESEARCH REVOLUTIONIZING THE LAUNCH INDUSTRY
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1st commercial rocket
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Low-cost alternative to traditional launch providers backed by governments
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Launch of SES Satellite to GEO on 6 December 2013 Example of costreductions: Falcon 9 v 1.1 engine had 75% more thrust, 60% more fuel in rocket fuselage for both first and second stage
DRAGON )
FALCON 9 v 1.1
FALCON HEAVY
• First commercially built and operated spacecraft that was recovered from orbit • First commercially built spacecraft to dock at the ISS • Designed to carry heavy interplanetary spacecraft to space • The worlds most powerful rocket • Designed for extreme reliability – “the commercial aircraft of space travel” • Twice the performance and 1/3 the cost of the Delta IV Heavy
SPACEX RESEARCH REVOLUTIONIZING THE LAUNCH INDUSTRY
LAUNCH VEHICLE
FALCON HEAVY
SPACE SHUTTLE
PROTON M
PAYLOAD TO LEO
53,000 kg
24,000 kg
23,000 kg
DELTA IV HEAVY )22,560
kg
Estimated Launch Date:
JULY 2014 2012 US Air Force Cost per launch:
USD $435 million Cost of the Falcon Heavy:
USD $125 million
FALCON HEAVY
TITAN IV B
ARIANE 5 ES
JAPAN HII B
CHINA LM 3B
21,680 kg
20,000 kg
16,500 kg
11,200 kg
• Designed to carry heavy interplanetary spacecraft to space • The worlds most powerful rocket • Designed for extreme reliability – “the commercial aircraft of space travel” • Twice the performance and 1/3 the cost of the Delta IV Heavy
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STRATEGIC ANALYSIS
INTERNAL ANALYSIS – OPERATING MODEL Flat Organization Structure
Culture of Innovation
Vertically Integrated Production
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Simplicity Low Cost Reliability
Leading Edge Design
Competition in multiple markets
LEVERAGING ON A FLAT ORGANIZATIONAL STRUCTURE FOR SUCCESS
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Silicon Valley Tech Firm
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Flat organizational structure )
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Large multinational firm, 24 shareholders from 10 countries
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Open office design and culture
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Separate design and production
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Young and talented workforce
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Successful CEO in Elon Musk
Joint decision making under authority of European Space Agency
Corporate structure supports collaboration and efficient decision making
Bureaucracy and government ownership hampers decision making and innovation
LEADING EDGE DESIGN AND COST INNOVATION •
Simple and proven rocket design allows for reliability and up to 70% cost improvement for customers
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ARIANE 5
PROTON M
LONG MARCH 3B
FALCON 9
ARIANESPACE
ILS (Russia)
CHINA
SPACEX
PRICE
$US 220M
$US 85M
$US 70M
$US 54M
PAYLOAD to GEO
10,500 kg
5,500 kg
4,491 kg
4,540 kg
US$ 20,952
US$ 15,545
US$ 15,586
US$ 11,894
VEHICLE NAME MANUFACTURER
COST per KG
VERTICALLY INTEGRATED PRODUCTION Arianespace has multiple contractors:
SpaceX manufactures all their parts in-house:
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Eliminates subcontractors
Rockets made in Europe
Reduced cost & better quality
Prime contractor: Astrium Europe
Tighter feedback loop between design and production
Delivers rockets for launch in French Guiana in S.A
Development time reduced (85%)
Increased transportation cost
COMPETITION ACROSS MULTIPLE MARKETS Competes for Government Contracts
Lightweight Sub-Orbital Market
Economies of Scale through high launch activity!
Commercial LEO Orbit Market
Ability to go to GTO and beyond Falcon Heavy
Falcon 9 )
Falcon 1
Dragon
Continuous pursuit of cost improvements across all markets!
CULTURE OF INNOVATION & IMPROVEMENT
Developing World’s First Reusable Rockets
Reusable Dragon Cargo capsule
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World’s Most Powerful Rocket by Payload
Highest structural safety margins for human flight
STRATEGIC ROADMAP Resources
Distinctive Competencies
Low Cost Falcon 9 Rocket Rocket Landing Technology Reusable Dragon Cargo Capsule Young, Talented Engineers
Capabilities In-House Manufacturing Short Design to Build Time Period
Lowest cost per payload to LEO and GEO 晀Ғ
Regular resupply missions to the ISS World’s most powerful rocket - Ability to launch >53,000 kg to LEO
Sustained Value Creation Market leader for light commercial launch How do you marketdeliver consistently
superior value to Development customers?of reusable rockets for all deployments Market leader for US How do you build government launch intangible assets contracts
and prevent duplication by Pioneer in expeditions competitors? to Mars and beyond
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RECOMMENDATIONS & FUTURE DIRECTION
PRESENT CHALLENGES AND COMPETITION DELIVERING SUSTAINABLE VALUE CREATION CHALLENGE 1:
CHALLENGE 2:
CHALLENGE 3:
CHALLENGE 4:
Establishing
Ramping up
Maintaining
Successful
credibility as the
production to
resource position
development of
new kid on the
meet market
barriers against
reusable launch
block
demand
competition
rocket system
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CREDITS:
[email protected]
RECOMMENDATIONS LEVERAGING ON DISTINCTIVE COMPETENCIES FOR GROWTH Develop and retain key talent and personnel Continued pursuit of Cost Innovation Dominate lightweight launch segment Enhance production capabilities (x2)
Develop & Build Credibility
Economies of Scale with launch activity Increase number of launch sites in US
Establish market leadership in development of reusable rockets and deep space exploration capabilities
Grasshopper Project Crew Ready Dragon Capsule Use of Falcon Heavy for Mars Exploration Project
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END OF PRESENTATION THANK YOU!
APPENDIX: 2012 SATELLITE INDUSTRY INDICATORS SUMMARY
SOURCE: Satellite Industry Association Annual Report 2013
APPENDIX: TOP LEVEL GLOBAL SATELLITE INDUSTRY FINDINGS
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SOURCE: Satellite Industry Association Annual Report 2013
APPENDIX: SATELLITE AND COMMERCIAL LAUNCH DEMAND FORECAST TO 2022
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Demand for satellite launches set to pick up in the near term
Trend toward heavier, more capable satellites (50% in heaviest mass class)
Ability to deliver dual manifests an advantage
SOURCE: FAA 2013 Commercial Space Transportation Forecasts
APPENDIX: NASA COMMERCIAL CARGO AND CREW PROGRAM – GOVT SPACE CONTRACTS Commercial Orbital Transportation Services (COTS)
Commercial Crew Program (CCP)
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Developed since 2006
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Developed since 2008
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NASA helping US companies to develop and demonstrate cargo space transportation capabilities
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To develop and advance US capabilities in crew transportation designs
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Competition opened to private sector for safety and cost effectiveness
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Key Competitors: (milestones)
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SPACE X has completed ALL COTS milestones in May 2012 Only competitor: Orbital Sciences Corporation (completed all COTS milestones in Sept 2013)
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Boeing (8 out of 19)
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Sierra Nevada (5 out of 9)
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Space X (6 out of 14)
SOURCE: NASA Cargo and Crew Update NAC HEO Meeting – July 2013
APPENDIX: SPACE X COMPLETED MISSIONS
Mainly test flights and government contracts
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First commercial launch for SES (Europe) in Dec 2013 USD$ 1.6 billion contract to resupply ISS
SOURCE: SPACEX LAUNCH MANIFEST – WEBSITE (C.A.A Dec 2013)
APPENDIX: SPACE X LAUNCH MANIFEST
14 Launches planned in 2014, another 14 in 2015 Value of launch contracts worth up to $40 billion *
About 60% of these contracts are from the commercial space
SOURCE: SPACEX LAUNCH MANIFEST – WEBSITE (C.A.A Dec 2013)
APPENDIX: SPACE X LAUNCH AND MANUFACTURING FACILITIES (1) SPACE LAUNCH COMPLEX 40 – CAPE CANAVERNAL AIR FORCE STATION Cape Canaveral, FL
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Bought facility since 2007
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Successfully launched the Falcon 9 in 2010 at SLC-40 覰Ҕ
SPACEX HEADQUARTERS & MISSION CONTROL Hawthorne, CA
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Design and manufacture of engines and rocket bodies
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Floor plan designed around mass production to achieve pace of 40 core engines annually
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Home of Mission Control since 2002 SOURCE: Space X COTS Mission Update (July 2013)
APPENDIX: SPACE X LAUNCH AND MANUFACTURING FACILITIES (2) SPACEX ROCKET DEVELOPMENT FACILITY McGregor, TX
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Test center for engines and structures
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State-of-the-art rocket development equipment Ҙ
SPACEX LAUNCH COMPLEX 4E, VANDENBERG AIR FORCE BASE Near Lompoc, CA
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Newest launch facility acquired in early 2012
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Designed for heavier launches of the Falcon Heavy and Grasshopper projects SOURCE: Space X COTS Mission Update (July 2013)
