Rocket Lab is building a larger, reusable launch vehicle called the Neutron, and aims to cost close to $50 million per launch to challenge Elon Musk’s SpaceX.
“We are positioning Neutron to compete directly with Falcon 9,” Rocket Lab Chief Financial Officer Adam Spice said earlier this week, speaking at a Bank of America event in London on Tuesday.
The company announced the Neutron will launch in 2021, with Spice saying the rocket remains on track to debut in 2024. During its fourth quarter report last month, Rocket Lab said it had begun production of the Neutron’s first tank structure, as well as construction of the launch pad. for the rocket. The company plans to conduct the first “hot fire test” of the Archimedes engine, which will power the Neutron, “by the end of the year,” Spice said.
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SpaceX advertises a $67 million Falcon 9 launch, and Spice said Rocket Lab aims to match the cost per kilogram for satellite customers. That means Neutron is targeting “launch service costs of $50 million to $55 million,” Spice said.
Spice also noted that Rocket Lab expects to fly a Neutron booster that can be reused “10 to 20 times,” with the reusable performance of the Falcon 9 booster.
“Ultimately we expect a margin of around 50%” for the Neutron launch, Spice added. He estimated the cost of goods for each Neutron to be $20 million to $25 million, with “closer to half of that” coming from the second stage of the rocket that was no longer usable.
Additionally, with SpaceX working on developing the massive Starship rocket, Spice mentioned that the company may move away from the Falcon 9 mission.
“We don’t have any hard data on this, but certainly, if it happens, it would be an incredible thing for Neutron,” Spice said.
In the meantime, Spice said Rocket Lab looks to maintain its position as a “dominant player” in the sub-sector of the market launching small satellites with its Electron vehicle. The company expects to launch three Electron missions in the second quarter, with two already completed, and “on track” to launch 15 missions this year, Spice said.
More than a rocket
Spice also emphasized to the Bank of America audience that Rocket Lab is “more than” just a rocket company. Indeed, the company’s acquisitions and expansion into building satellite components and spacecraft have become a significant source of monthly revenue.
“All of this leads to the biggest opportunity in the space, which is really on the application side,” Spice said.
As CEO Peter Beck has previously noted, Rocket Lab aims to create an “end-to-end platform for customers” who need space-based services. Spice said the company wants to operate the satellites and “send data to customers and develop a continuous revenue stream,” meaning it would eliminate the need for other companies to build and operate their own satellites.
“A lot of companies we work with [launching to orbit on Electron] now it’s an unnatural space asset owner,” Spice said, adding that “the best owner of a space asset is the person who can launch it.”
