Transcript 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.

Launch Vehicle
Business
Workshop
Faculty
John M. Jurist, Ph.D.
David L. Livingston, D.B.A.
Tasks
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Characterize notional vehicle
Principles of cost engineering
Estimate development costs
Estimate production costs
Synthesis of financial proforma
Market assumptions / factors
Goals for Participants
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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
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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
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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
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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-1e
Stage 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
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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
TRL2
TRL3
TRL4
TRL5
Basic principles observed and reported
Technology concept and prototype
demonstration or application formulated
Analytical and experimental critical functions
or characteristics demonstrated
Component or breadboard validation in
laboratory
Component or breadboard validation in
relevant environment
Technology Readiness Levels (2)
TRL6
TRL7
TRL8
TRL9
System/subsystem model or prototype
demonstration in relevant environment
(minimum for all systems for development)
System prototype demonstration in
space environment
System completed and flight qualified
by test and demonstration
System flight proven by successful
mission operations
Cost Engineering
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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?
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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)
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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)
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Development submodel
Flight tests (intermediate)
Production vehicle cost submodel
Refurbishment (intermediate)
Ground and flight operations submodel
Cost – Why a Surrogate?
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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
300,000
US Dollars/year
250,000
200,000
150,000
100,000
50,000
0
1960
1970
1980
1990
Year
2000
2010
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)
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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
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Unit Production Cost Submodel
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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)
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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)
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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
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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%
7-10%
5-8%
Conventional Design
Historical Development Mass
Growth (Percent)
Thor
Saturn S-IV
Saturn S-IVb
Lunar Lander
STS Orbiter
Airbus A-380
6.3
13.7
12.5
27
25
3
Existing Structural Safety Factors
ELV = 1.10 – 1.25
RLV = 1.35 – 2.0
Safety Factor Comparables
Commercial
Aircraft
Unpressurized Pressurized Lines/ducts
Structure
Structure
>4 cm dia
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
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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
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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 Status
1.3-1.4
1.1-1.2
0.9-1.1
0.7-0.9
0.4-0.6
1st generation, new concept approach
with new techniques and technologies
New design with some new
technical/operational features
Standard projects, state of art, similar
systems operational
Design modifications of existing
systems
Minor variation of existing projects
f2 Technical Quality
Specific definition depends on submodel
f3 Team Experience
1.3-1.4
1.1-1.2
1.0
0.8-0.9
0.7-0.8
New team, no direct relevant experience
Partly new activities for team
Company team with some related
experience
Team has developed similar projects
Team has superior experience with this
type of project
f6 Deviation from Optimum Schedule (1)
% Optimum
70
80
90
100
110
120
130
140
150
170
Cost Factor
1.15
1.08
1.03
1.0
1.03
1.13
1.23
1.32
1.4
1.5
f6 Deviation from Optimum Schedule (2)
Cost Factor vs. Schedule
Relative Cost Factor
1.6
1.5
1.4
1.3
1.2
1.1
1.0
60
80
100
120
140
Percent of Optimal Schedule
160
180
f7 Program Organization
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“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
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USA
France
China
f8 = 1.00
f8 = 0.79
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 vehicles
MYr = 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
NMF without motors
0.35
0.30
0.25
0.20
0.15
LH2
0.10
0.05
0.00
1,000
10,000
100,000
Propellant Mass, Kg
1,000,000
Development Cost Submodel (6)
(Liquid Hydrogen Ballistic RLV KREF)
Net Mass Fraction vs. Ascent Propellant
0.16
NMF without motors
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00
100,000
1,000,000
Propellant Mass, Kg
10,000,000
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 aircraft
MYr = 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
0.40
NMF without motors
0.35
0.30
0.25
0.20
0.15
0.10
0.05
0.00
10,000
100,000
1,000,000
Propellant Mass, Kg
10,000,000
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 number
TM = maximum mission design lifetime (days)
Crewed space systems
MYr = 1113 M0.383 f1 f3
M = reference mass (kg)
Development Margins
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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
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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
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Assume preproduction prototype
Assume successful tests
Estimate Production Costs
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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
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Production Learning Factor f4 (2)
Aerospace manufacturing reduction
approximately 10-15% per doubling
 Agena-A 15%
 Ariane-4 12.5%
 STS ET 10%
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Production Learning Factor f4 (3)
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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
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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
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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 Vehicle
Stage 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
Structure + Motor
Stage 2
4,013 lb 1,130 lb
1,824 kg
514 kg
Motor
1,202 lb
167 lb
546 kg
76 kg
Propellant
69,419 lb 8,938 lb
31,554 kg 4,063 kg
Motor qualification firings
300
Data for Cost Estimation (2)
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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
6,902 MYr
Stage 2
1,087 MYr
Vehicle R&D 13,843 MYr
7,099 MYr
Motor R&D
Motor TFU
55.35 MYr
19.28 MYr
Vehicle TFU
86.76 MYr
43.26 MYr
Data for Cost Estimation (5)
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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)
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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)
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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
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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