NASA suspends SpaceX’s $2.9 billion moon lander contract after rivals protest

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NASA has suspended its contract with SpaceX for the landing system to take astronauts down to and back from the lunar surface.  Two other competitors for the contract, Blue Origin, and Dynetics, have filed protests with the Government Accountability Office (GAO) and NASA issued the stop-work order until GAO resolves the matter.

NASA awarded 10-month contracts to three companies one year ago today to further develop their concepts for Human Landing Systems (HLS) as part of the Artemis program to return astronauts to the lunar surface: SpaceX, Dynetics, and Blue Origin’s “National Team” that includes Lockheed Martin, Northrop Grumman, and Draper.

NASA’s Space Launch System (SLS) rocket and Orion spacecraft will take crews to lunar orbit, but they will finish the journey using HLS.

Elon Musk’s SpaceX was picked by NASA on April 16th to build the agency’s first human lunar lander since the Apollo program, as the agency opted to rely on just one company for a high-profile contract that many in the space industry expected to go to two companies.

“Pursuant to the GAO protests, NASA instructed SpaceX that progress on the HLS contract has been suspended until GAO resolves all outstanding litigation related to this procurement,” NASA spokeswoman Monica Witt said in a statement.

Starship, SpaceX’s fully reusable rocket system under development to eventually ferry humans and cargo to the Moon and Mars, won NASA’s award mainly for its massive cargo capability and its proposed bid of $2.9 billion — far cheaper than Blue Origin’s and Dynetics’, according to a NASA source selection document.

Starship’s development to this point has been driven primarily by Musk, SpaceX’s billionaire founder and chief executive. The company has launched several Starship prototypes in short- and high-altitude test flights at its Boca Chica, Texas, launch facilities. Landing the prototypes after soaring over six miles in the air has proved to be a formidable challenge — all of SpaceX’s high-altitude prototype rockets have been destroyed in landing-phase explosions.

SpaceX’s private Starship development will likely continue. The company’s most recent test of a Starship prototype, SN15, is slated to launch within the next few days after clinching license approval from the Federal Aviation Administration this week.

NASA has said picking one company was the best decision it could make at the time with the funds made available from Congress. Last year, Congress gave the agency $850 million of the $3.3 billion it requested to procure two lunar landers.

SpaceX’s award was a key “first step” in a broader program to secure transportation to the Moon, NASA’s human spaceflight chief Kathy Lueders said at the time, promising that new contract opportunities will open up in the near future.

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