Launch Vehicle Business

Workshop

Faculty

John M. Jurist, Ph.D.

David L. Livingston, D.B.A.

Tasks Characterize notional vehicle Principles of cost engineering Estimate development costs Estimate production costs Synthesis of financial proforma Market assumptions / factors

Goals for Participants Step through process of notional vehicle

characterization Gather data required for cost estimation Learn principles and concepts of Transcost Estimate development and production costs Synthesis of financial proforma Study variable sensitivities Discuss market assumptions / factors

Characterize Notional Vehicle Define mission characteristics Incorporate understanding of technology Rough out vehicle concept

Notional Vehicle Disclaimer

Any similarity to Space-X Falcon-1 is purely coincidental

Public domain information from Space-X is useful for sanity checks

Notional Vehicle Characterization

Deliver payload of 1,600 pounds to 200 km low earth orbit (LEO)

Expendable launch vehicle (ELV) Vertical take off (VTO) Two stage (TSTO) Conventional bipropellant liquid Liquid oxygen (LOX) and kerosene (RP-1)

Notional Flight Parameters 200 km circular orbit 7,784 meters/sec circular velocity 30% margin for gravity, air drag, other Total launch speed change capability Delta-V = 10,114 meters/sec Includes 460 meters/sec Earth spin boost

The Rocket Equation

Mo/Mf = e(v/c) or v = c ln(Mo/Mf)

Mo = GLOW = liftoff mass

Mf = burnout mass

c = g * Isp = exhaust velocity

v = ideal burnout velocity

Space-X Falcon-1eStage 1 Stage 2

Payload 11,896 lbs 1,590 lbs + 300 shroud

Structure + Motor 4,000 lbs 1,125 lbs

Usable Propellant 69,000 lbs 8,881 lbs

GLOW 85,000 lbs 11,896 – 300 shroud

Thrust (vacuum) 115,400 lbs 7,000 lbs

Motor T/W 96:1 42:1

Motor Isp (vacuum) 304 sec 327 sec

Burn Time 169 sec 418 sec

Delta-V (ideal) 4,995 meters/sec 4,653 meters/sec

Cost Engineering What is it? Ignore cost (cost + percentage) and

optimize performance Design to cost (cost + fixed fee) and meet

performance Cost engineering (cost + incentive)

minimize life cycle (complete or partial) cost

Technology Readiness Levels (1)TRL1 Basic principles observed and reported

TRL2 Technology concept and prototype demonstration or application formulated

TRL3 Analytical and experimental critical functions or characteristics demonstrated

TRL4 Component or breadboard validation in laboratory

TRL5 Component or breadboard validation in relevant environment

Technology Readiness Levels (2)TRL6 System/subsystem model or prototype

demonstration in relevant environment (minimum for all systems for development)

TRL7 System prototype demonstration in space environment

TRL8 System completed and flight qualified by test and demonstration

TRL9 System flight proven by successful mission operations

Cost Engineering Most commonly used model: Transcost Price-H (Burmeister): Component costs

adjusted by various complexity factors TRASIM: Defined subsystem costs NASCOM: Database adjusts for production

and avionics complexity

What is Transcost? Dr. Dietrich E. Koelle Statistical-Analytical Model for Cost

Estimation and Economical Optimization of Launch Vehicles

Parametric cost estimation: Method of estimating cost per unit mass

Transcost 7.2 (1) Dr. Dietrich E. Koelle Parametric (cost surrogate per unit mass) Weighting factors for team experience,

team skill base, vehicle complexity, etc. Learning factor for production

Cost = A * Mass B * f1* f2 * f3 * … * fN

Transcost 7.2 (2) Development submodel Flight tests (intermediate) Production vehicle cost submodel Refurbishment (intermediate) Ground and flight operations submodel

Cost – Why a Surrogate? Engineering or production man years

cleaner variable than dollars Can be adjusted for inflation Can be adjusted for productivity Can be adjusted for currency fluctuations

Engineering Man Year Inflation (1)

1960 = $ 26,000

1970 = $ 38,000

1980 = $ 92,200

1990 = $156,200

2000 = $208,700

2007 = $252,000

Engineering Man Year Inflation (2)

Aerospace Man Year Cost

0

50,000

100,000

150,000

200,000

250,000

300,000

1960 1970 1980 1990 2000 2010

Year

US

Dol

lars

/yea

r

Development Factors f1 Technical development status

f2 Technical quality

f3 Team experience

f6 Deviation from optimum schedule

f7 Program organization

f8 Engineering man year correction

Development Cost Submodel (1) Solid propellant rocket motors Liquid propellant rocket motors with turbopumps Pressure fed liquid propellant rocket motors Airbreathing turbo- and ramjet engines Solid propellant rocket boosters (large) Propulsion systems / modules Expendable ballistic launch vehicles

Development Cost Submodel (2) Reusable ballistic launch vehicles Winged orbital rocket vehicles HTO 1st stage vehicles, advanced aircraft VTO 1st stage flyback rocket vehicles Crewed re-entry capsules Crewed space systems

Unit Production Cost Submodel Solid propellant rocket motors Liquid propellant rocket motors with turbopumps Airbreathing turbo- and ramjet engines Propulsion modules Ballistic rocket vehicles (expendable & reusable) High speed aircraft / winged first stages Winged orbital rocket vehicles Crewed space systems

Ground & Flight Ops Submodel (1) Prelaunch ground operations Launch and mission operations Ground transportation and recovery Propellants, gases, and material Program administration and system

management Technical system support Launch site and range cost

Ground & Flight Ops Submodel (2) Function of launch rate Learning factor applies RLV reuse and refurbishment relevant Spares production and inventory Detailed analysis beyond scope of this

workshop

Development Cost Configure system Develop mass budget Develop appropriate margins

Suggested Development Mass Margins

Study Phase A Phase B

First of Kind 15-20% 12-15%

Advanced Design 10-15% 7-10%

Conventional Design 7-10% 5-8%

Historical Development Mass Growth (Percent)

Thor 6.3

Saturn S-IV 13.7

Saturn S-IVb 12.5

Lunar Lander 27

STS Orbiter 25

Airbus A-380 3

Existing Structural Safety Factors

ELV = 1.10 – 1.25

RLV = 1.35 – 2.0

Safety Factor Comparables

Unpressurized Structure

Pressurized Structure

Lines/ducts >4 cm dia

Commercial Aircraft

1.5 2.0 2.5

ELV 1.1 1.25 1.25

RLV 1.35-1.5 1.8-2.0 2.5

STS Orbiter 1.35 1.8 1.5

Cost Driver -- Payload Payload is more important cost driver than

GLOW 20% increase in payload increases ELV

development by 7% 20% increase in payload increases RLV

development by 4% Cost effective to oversize vehicle to assure

payload sufficiency

Estimate Development Cost First stage motor(s) Second stage motor(s) First stage vehicle Second stage vehicle Correct for various relevant factors Convert into dollars

f1 Technical Development Status1.3-1.4 1st generation, new concept approach

with new techniques and technologies1.1-1.2 New design with some new

technical/operational features0.9-1.1 Standard projects, state of art, similar

systems operational0.7-0.9 Design modifications of existing

systems0.4-0.6 Minor variation of existing projects

f2 Technical Quality

Specific definition depends on submodel

f3 Team Experience1.3-1.4 New team, no direct relevant experience

1.1-1.2 Partly new activities for team

1.0 Company team with some related experience

0.8-0.9 Team has developed similar projects

0.7-0.8 Team has superior experience with this type of project

f6 Deviation from Optimum Schedule (1)% Optimum Cost Factor 70 1.15 80 1.08 90 1.03 100 1.0 110 1.03 120 1.13 130 1.23 140 1.32 150 1.4 170 1.5

f6 Deviation from Optimum Schedule (2)

Cost Factor vs. Schedule

1.0

1.1

1.2

1.3

1.4

1.5

1.6

60 80 100 120 140 160 180

Percent of Optimal Schedule

Rel

ativ

e C

ost

Fac

tor

f7 Program Organization “Too many cooks spoil the broth” f7 = n 0.2

n = participating parallel organizations Not number of subcontractors if organized

strictly according to prime/sub principle

f8 Engineering Man Year Correction

USA f8 = 1.00

France f8 = 0.79

China f8 = 1.34

Correction factor f8 based on effective working

hours/year * relative education * relative dedication

Development Cost Submodel (1)Solid propellant rocket motors

MYr = 16.3 M0.54 f1 f3

M = motor net mass (kg)

Liquid propellant rocket motors with turbopumps

MYr = 277 M0.48 f1 f2 f3 f2 = 0.026 (ln NQ)2

M = motor dry mass (kg)

NQ = number of qualification firings (vs 12,000 endurance cycle firings for jet engines)

Development Cost Submodel (2)Pressure fed liquid propellant rocket motors

MYr = 167 M0.35 f1 f3

M = motor dry mass (kg)

Airbreathing turbo- and ramjet engines

MYr = 1380 M0.295 f1 f3

M = engine dry mass (kg)

Development Cost Submodel (3)Solid propellant rocket boosters (large)

MYr = 10.4 M0.6 f1 f3

M = booster net mass (kg)

Propulsion systems / modules

MYr = 14.2 M0.577 f1 f3

M = system dry mass with motors (kg)

Development Cost Submodel (4)Expendable ballistic launch vehicles

MYr = 100 M0.555 f1 f2 f3 f2 = Kref / Keff

M = vehicle dry mass without motors (kg)Kref = reference net mass fraction (from graph)Keff = (M + residuals) / propellant

Reusable ballistic launch vehiclesMYr = 803.5 M0.385 f1 f2 f3 f2 = Kref / Keff

M = vehicle dry mass without motors (kg)Kref = reference net mass fraction (from graph)Keff = (M + residuals) / propellant

Development Cost Submodel (5)(Liquid Ballistic ELV KREF)

Net Mass Fraction vs. Propellant

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

1,000 10,000 100,000 1,000,000

Propellant Mass, Kg

NM

F w

ith

ou

t m

oto

rs

LH2

Development Cost Submodel (6)(Liquid Hydrogen Ballistic RLV KREF)

Net Mass Fraction vs. Ascent Propellant

0.00

0.02

0.04

0.06

0.08

0.10

0.12

0.14

0.16

100,000 1,000,000 10,000,000

Propellant Mass, Kg

NM

F w

ith

ou

t m

oto

rs

Development Cost Submodel (7)Winged orbital rocket vehicles

MYr = 1421 M0.35 f1 f2 f3 f2 = Kref / Keff

M = vehicle dry mass without motors (kg)Kref = reference net mass fraction (from graph)Keff = (M + residuals) / propellant

HTO 1st stage vehicles, advanced aircraftMYr = 2880 M0.241 f1 f2 f3 f2 = Mach0.15

M = vehicle dry mass without engines (kg)VTO 1st stage flyback rocket vehicles

MYr = 1462 M0.325 f1 f3

M = vehicle dry mass without motors (kg)

Development Cost Submodel (8)(Liquid Hydrogen Winged RLV KREF)

Net Mass Fraction vs. Ascent Propellant

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

10,000 100,000 1,000,000 10,000,000

Propellant Mass, Kg

NM

F w

ith

ou

t m

oto

rs

Development Cost Submodel (9)Crewed re-entry capsules

MYr = 436 M0.408 f1 f2 f3 f2 = (N*TM)0.15 M = reference mass (kg)N = crew numberTM = maximum mission design lifetime (days)

Crewed space systems

MYr = 1113 M0.383 f1 f3

M = reference mass (kg)

Development Margins Requirement changes during development Technical changes or “improvements” Technical component/software failures Changes in personnel or management

structure Funding limitations per budget year

Development Cost Risks Technology not fully qualified Vehicle specifications incomplete at start of

project and not frozen Masses underestimated – optimistic

assumptions Schedule assumes no mishaps or delays

Development Mass and Cost Factors

Dry Mass Development Cost ELV Mass Development Cost

ELV 1.0 1.0 1.0

Ballistic RLV 2.2 2.4 1.6

Winged Orbital RLV 4.1 4.0 2.1

Flyback Booster 5.7 3.4 1.8

Production Costs Assume preproduction prototype Assume successful tests

Estimate Production Costs First stage motor Second stage motor First stage vehicle Second stage vehicle Correct for production numbers Convert to dollars

Production Learning Factor f4 (1) Defined by T. P. Wright in 1936 f4 Cost reduction with production Each doubling of production of identical

units reduces costs by a fixed percentage Percentage varies directly with production

rate and inversely with size and complexity

Production Learning Factor f4 (2) Aerospace manufacturing reduction

approximately 10-15% per doubling Agena-A 15% Ariane-4 12.5% STS ET 10%

Production Learning Factor f4 (3) If Learning Factor is L = 10% and CN is the

cost of the Nth unit, The 2 * Nth unit will cost 90% of CN .

C2N = (1 – L/100%) * CN

CN = C1 * (1 – L/100%)(log N/log 2)

Production Learning Factor f4 (4)

Koelle uses n * f4 to obtain average cost of producing n units

We use f4 variant with First Unit Cost (TFU or FUC) to obtain cost of each unit produced

Unit Production Cost Submodel (1)Solid propellant rocket motors

MYr = 2.3 M0.399 f4

M = net motor mass (kg) (cost includes propellant)

Liquid propellant rocket motors with turbopumps & LH2

MYr = 5.16 M0.45 f4

M = motor dry mass (kg)

Pressure or pump fed liquid rocket motors without LH2

MYr = 1.9 M0.535 f4

M = motor dry mass (kg)

Unit Production Cost Submodel (2)Airbreathing turbo- and ramjet engines

MYr = 2.29 M0.545 f4

M = engine dry mass (kg)

Propulsion modules

MYr = 4.65 M0.49 f4

M = system dry mass with motors (kg)

Unit Production Cost Submodel (3)Ballistic rocket vehicles (expendable & reusable)

MYr = 0.83 M0.65 f4

M = vehicle dry mass without motors (kg)

Use 1.30 instead of 0.83 if LH2 is propellant)

RLV has 40% higher dry mass than ELV

Unit Production Cost Submodel (4)High speed aircraft / winged first stages

MYr = 0.367 M0.747 f4

M = vehicle dry mass without engines (kg)

Winged orbital rocket vehicles

MYr = 3.75 M0.65 f4

M = vehicle dry mass without motors (kg)

Crewed space systems

MYr = 0.16 M0.98 f4

M = reference mass (kg)

Notional Vehicle Characterization Assume 300 lb payload shroud dropped at

2nd stage ignition Assume 460 meter/sec boost from Earth

spin and launch to east Total Delta-V = 10,114 meters/sec Same structural net mass fractions and

motor thrust to weight ratios as Falcon-1e

Notional Vehicle Data

Spreadsheet: Scale-by-Payload.xls

Notional VehicleStage 1 Stage 2

Payload 11,967 lbs 1,600 lbs + 300 shroud

Structure + Motor 4,013 lbs 1,130 lbs

Usable Propellant 69,419 lbs 8,938 lbs

GLOW 85,399 lbs 11,967 – 300 shroud

Thrust (vacuum) 115,400 lbs 7,000 lbs

Motor T/W 96:1 (turbopump) 42:1 (pressure fed)

Motor Isp (vacuum) 304 sec 327 sec

Burn Time 183 sec 418 sec

Delta-V (ideal) 4,996 meters/sec 4,658 meters/sec

Data for Cost Estimation (1)

Stage 1 Stage 2

Structure + Motor 4,013 lb

1,824 kg

1,130 lb

514 kg

Motor 1,202 lb

546 kg

167 lb

76 kg

Propellant 69,419 lb

31,554 kg

8,938 lb

4,063 kg

Motor qualification firings 300

Data for Cost Estimation (2) Assume negligible residual propellant Assume clean sheet with new team Assume conventional aerospace rules of

thumb for masses, materials, assembly Assume aerospace standard overhead Assume a management miracle happens

Data for Cost Estimation (3)

Assemble new and young team from scratch

f1 = 1.1 New design with some new technical / operational features

f3 = 1.3 New team, no direct relevant experience

1 MYr = $252,000 (2007)

Data for Cost Estimation (4)

Stage 1 Stage 2

Motor R&D 6,902 MYr 1,087 MYr

Vehicle R&D 13,843 MYr 7,099 MYr

Motor TFU 55.35 MYr 19.28 MYr

Vehicle TFU 86.76 MYr 43.26 MYr

Data for Cost Estimation (5) Traditional aerospace industry costing Total R&D = 28,931 MYr = $7,290 Million Total TFU = 204.65 MYr = $ 51.57 Million Assume miraculous management in a new

startup reduces costs by 95 percent relative to traditional aerospace industry

Total R&D = $365 Million over 3 years Total TFU = $ 2.58 Million

Data for Cost Estimation (6) Assume first preproduction prototype

launches successfully Learning curve doesn’t apply to 2nd unit if 1st

unit fails because design changes cost money

Production of 20 units annually for 10 years Spreadsheet: Proforma.xls

Data for Cost Estimation (7) Assume 7%/yr interest and 4%/yr inflation Assume $5 million sales price per vehicle Production of 20 units annually for 10 years Assume learning factor of 12% Red ink for first 12 years Spreadsheet: Proforma.xls

Problems for Cost Estimation Examine effects of learning curve factor Examine effects of interest cost Examine effects of sales price and manufacturing

costs Examine effects of increased R&D costs and/or

development delays What happens if initial test fails or demand

doesn’t match production? Spreadsheet: Proforma.xls