SpaceX Will Build Prototype Mars Rockets In Texas, Not California

Last week, the Times reported that Elon Musk’s SpaceX was canceling plans to build its biggest rockets at the Port of Los Angeles, and shifting …

From Texas Standard:

It’s not often that the Los Angeles times covers news with a Texas slant, but this time, it was somewhat unavoidable.

Last week, the Times reported that Elon Musk’s SpaceX was canceling plans to build its biggest rockets at the Port of Los Angeles, and shifting production to South Texas. The story got lots of play in Southern California where it was considered something of a blow to the region’s dream of becoming the epicenter of the next wave of space exploration. And it was seen as a victory for Texas – one of California’s economic rivals.

SpaceX already has a launch facility in Boca Chica, near Brownsville, and Steve Clark, a staff writer at the Brownsville Herald says the facility was initially expected to host 12 launches a year once completed. When Musk attended the site’s groundbreaking in 2014, he hinted that Boca Chica could have an even higher-profile role in SpaceX plans.

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“He did say something about the possibility that the first person to depart Earth for Mars could actually leave from Boca Chica,” Clark says.

The Starship Hopper project – the one moved from Los Angeles to Texas – is the first prototype of SpaceX’s Mars initiative. The prototype vehicle will be built at Boca Chica. But development of the overall Starship Mars project remains in California.

Clark says the economic impact of Starship Hopper on South Texas is unclear, but that traffic to the Boca Chica site has increased. He says tourists are posing with the rocket prototype.

Texas likely got the nod to build these rockets because it would have been logistically more complicated to build them in California and then transport them to the Texas launchpad.

Written by Shelly Brisbin.

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How Much Is SpaceX Stock Worth?

Elon Musk has a plan. Actually, the CEO of SpaceX has several plans: He wants to continue supplying the International Space Station with food and …

Elon Musk has a plan.

Actually, the CEO of SpaceX has several plans: He wants to continue supplying the International Space Station with food and other consumables as far out as 2030, resume flights by American astronauts aboard American-built spacecraft, build a global satellite broadband network, and eventually put humans on Mars.

All of these plans, however, will cost money to develop the technologies to implement and continue driving down the cost of doing business in space. To get that money, SpaceX has been working diligently to raise debt and equity financing for its business. Fortunately for mankind’s space ambitions, it looks like SpaceX is succeeding at this — and fortunately for investors, every time SpaceX approaches its financiers for more money, it reveals a little bit more about its business, its finances, and its valuation.

Rocket landing on a drone ship

X marks the spot where we discover how much SpaceX’s treasure is worth. Image source: Getty Images.

A little bit of debt …

Case in point: In November, SpaceX secured a $250 million loan from “a select group of investors,” money it intends to use to continue development of its “Super Heavy” launch vehicle and “Starship” interplanetary rocketship. That was a nice chunk of change — there was just one problem.

SpaceX had apparently sought to raise three times as much cash — $750 million. At the time, it wasn’t entirely clear why SpaceX settled for the lower sum. (Wall Street banks were reportedly more than willing to ante up the entire $750 million Musk sought). But the reason for SpaceX’s decision to take on less debt soon became clear.

… and a whole bunch of equity

SpaceX would raise the rest of its sought-after $750 million with a stock offering. As The Wall Street Journalreported last month, SpaceX is in the final stages of selling $500 million worth of stock to its “existing [private] shareholders,” plus a new (also private) investor, Scottish money management firm Baillie Gifford & Co.

What we’ve learned about how much is SpaceX worth

So mission accomplished for SpaceX. But as good as this news is for SpaceX, it’s arguably even more important for investors who want to know how the market is valuing SpaceX today, on the off chance the company eventually files for an IPO. SpaceX revealed details on its business during the course of negotiations with its debt and equity counterparties.

As the Journal reports, SpaceX is selling $500 million worth of new shares to its private investors at “$186 a share.” For this math to work, SpaceX must be selling about 2.7 million shares. We also learn that this latest funding round is being conducted “at a $30.5 billion valuation.” From this fact, we can deduce that those 2.7 million shares represent a 1.6% interest in SpaceX. A little more elementary math and we can further determine that SpaceX will have roughly 165 million shares outstanding after completion of this equity issuance.

It never rains, but it pours

To the best of my knowledge, this is the first time SpaceX has ever revealed enough information about its capital structure to be able to pin an accurate share count, share price, and market capitalization on SpaceX stock — and the deluge of new data doesn’t end there.

From TheWall Street Journal‘s reporting, we also learned that in the 12 months ended Sept. 2018, SpaceX generated $2.5 million in revenue and earned interest, taxes, depreciation and amortization (EBITDA) of roughly $270 million. That works out to a 10.8% EBITDA margin that SpaceX is earning on its revenue.

This number, by the way, is remarkably close to the 13% EBITDA margin earned by Boeing, and the 13.5% margin earned by Lockheed Martin — SpaceX’s two biggest rivals in spaceflight — despite the fact that SpaceX charges much, much less for its rocket launches than its rivals. This suggests that SpaceX has the capability to turn GAAP-profitable essentially anytime it wants, simply by raising its prices a bit or, conversely, by lowering its costs — for example by launching reusable rockets more frequently.

In that regard, it’s worth pointing out that through mid-January 2019, SpaceX has launched 40 rockets in a row successfully, and has relanded and recovered for reuse 33 of those rockets’ first stages. To date, only a handful of these rockets have actually been reused — but the more of them that are, the more SpaceX’s profits should improve, and the more SpaceX stock should be worth.

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Future SpaceX & Blue Origin rocket recoveries may use largest mobile crane in the US

While there’s a good chance that SpaceX will avoid changing their current Port Canaveral recovery operations and the complement of cranes they …

Florida’s Canaveral Port Authority took delivery of what is now the largest mobile crane on U.S. soil, originally purchased in order to support both extremely large cargo ships (known as New-Panamax-class) and the unique needs of orbital-class rocket recovery operations for SpaceX’s Falcon 9 and Falcon Heavy and Blue Origin’s prospective New Glenn launch vehicle.

While there’s a good chance that SpaceX will avoid changing their current Port Canaveral recovery operations and the complement of cranes they already lease or own, Blue Origin will almost certainly take advantage of Port Canaveral’s vast new crane, capable of lifting more than 200 metric tons (~450,000 lbs) at heights greater than 50 meters (160 ft).

I know @AstroVicnet had some questions about the new mobile crane and how it will be used in Port Canaveral. Here is an explainer and how it connects to our Spaceport partners like @SpaceX and @blueorigin. #SpaceXFleethttps://t.co/UQqItZbdIr

— Julia (@julia_bergeron) January 19, 2019

To put the scale of the crane (and perhaps SpaceX and Blue Origin rockets) into perspective, Falcon 9’s booster – on its own – stands an incredibly 45m (~150 ft) tall or almost the same height as the LHM 600’s main boom (the gray cylinder/tower in the photos above), while Blue Origin’s New Glenn first stage – set to debut as early as 2021 – would tower an extraordinary 57.5m (~190 ft) tall, probably 60m if its small legs are deployed. While SpaceX’s BFR booster (now Super Heavy) is expected to attempt recoveries on the actual launch pad mount, it would stand around 63m (~210 ft) tall. New Glenn and Super Heavy are likely to weigh 50-150+ tons empty.

COLOSSAL CRANE ARRIVES: A 270-foot-tall mobile harbor crane billed as the largest in the United States sails into Port Canaveral aboard the cargo vessel Happy Dover on Friday morning. The 87-foot-long, 1.1-million-pound Liebherr LHM 600 is set to go into service later this year. pic.twitter.com/51DP8Hdb0w

— Port Canaveral (@PortCanaveral) January 18, 2019

The point is that for monolithic objects that are as tall as large rocket boosters, the logistics of actually moving them around can be surprisingly complex and challenging. SpaceX’s Falcon 9 and Heavy boosters happen to be short enough to be conveniently moved and manipulated by cranes that are quite large but still fairly common and easy enough to lease or purchase. SpaceX consistently uses similar tall, yellow cranes for the process of actually lifting Falcon 9 boosters – around 30t (~66,000 lbs) dry – off of their drone ships and onto land, while far smaller wheeled cranes can be used for the process of manipulating Falcon boosters once they are horizontal.

Given just how relatively light Falcon boosters are compared to their towering height, the cranes that can safely lift such tall and delicate objects tend to be designed to easily lift 5-10X as much weight at once. The next-generation rocket boosters (and even SpaceX’s Starship upper stage) will continue to push the height performance and begin to test the mass capabilities of modern cranes, particularly mobile varieties like the one that just arrived in Port Canaveral. One massive benefit of wheeled cranes like LHM 600 is how versatile and flexible they are, while tracked cranes like the largest ones SpaceX currently uses simply can’t move without risking the destruction of the ground beneath them, requiring that they use advanced mass-spreading technologies (i.e. giant beams of hardwood) wherever they crawl.

Another view of Port Canaveral’s shiny new LHM 600 crane shortly after arriving ashore. (Canaveral Port Authority)

Teslarati photographer Tom Cross managed to catch Port Canaveral’s new crane shortly after sunset, January 18th. (Tom Cross)

One of several large cranes used by SpaceX to vertically transport Falcon 9 and Falcon Heavy boosters is pictured here during third recovery of Falcon 9 B1046, December 2018. (Pauline Acalin)

Blue Origin’s New Glenn visualized shortly after landing aboard a recovery vessel. (Blue Origin)

Liebherr’s mobile harbor cranes offer a far more mobile solution in the form of traditional rubber tires and multiple large spreader plates that can be deployed and retracted when stationary. It will be genuinely interesting to see if SpaceX decides to replace its proven modes of vertical-lift recovery operations to gain the benefits of a crane that is new and an unknown quantity but could still simplify certain recovery operations. Perhaps even more importantly, the Canaveral Port Authority owns the new crane and apparently bought it with the specific intention of allowing companies like SpaceX and Blue Origin to use it – presumably for a reasonable fee – to assist during rocket recovery operations.


Check out Teslarati’s newsletters for prompt updates, on-the-ground perspectives, and unique glimpses of SpaceX’s rocket launch and recovery processes!

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Big Texas Will Be Production Site For SpaceX’s Biggest Rocket

SpaceX said it will develop and build its biggest spacecraft to date — Starship/Super Heavy – at its facility in South Texas instead of at the Port of Los …

SpaceX said it will develop and build its biggest spacecraft to date — Starship/Super Heavy – at its facility in South Texas instead of at the Port of Los Angeles as announced in April 2018.

Starship/Super Heavy was previously known as the BFR (for Big Falcon Rocket).

Development and manufacturing of the company’s Falcon 9/Heavy, Merlin and Raptor will continue at the company’s Hawthorne, California headquarters. The announcement of the move to South Texas, however, did not eliminate the possibility SpaceX still plans to develop an oceanside factory in the near future for Starship/Super Heavy.

What is clear is that SpaceX will assemble and test its Starship prototype in Texas instead of California.

To streamline operations, SpaceX is developing and will test the Starship test vehicle at its site in south Texas, said a SpaceX statement. The company said this decision does not impact its current manufacture, design, and launch operations in Hawthorne and Vandenberg Air Force Base in California. SpaceX will, however, continue recovery operations of its reusable Falcon rockets and Dragon spacecraft at the Port of Los Angeles.

SpaceX is making a lot of noise about the development of the Starship “hopper,” a prototype of Starship/Super Heavy. The first short test flights for the hopper are to begin this year.

Hopper will also be built in Texas (where SpaceX has a launch site) because the massive size of these launch vehicles makes them very difficult to transport by sea or land.

In 2018, SpaceX COO and President Gwynne Shotwell revealed that the estimated cost of moving a BFR-sized rocket from the company’s main Hawthorne factory to the Port of Los Angeles would average $5 million for a one-way trip.

She said this amount is almost 10% of the list price of an entirely new Falcon 9 rocket ($62 million). A BFR is nine meters tall.

As a result, SpaceX decided to build a permanent factory at a Port of Los Angeles dock known as Berth 240. Locating at the Port of Los Angeles would have allowed SpaceX to build a manufacturing facility on a 19-acre plot on Terminal Island.

The initial plan was for the huge BFRs to be then transported via barge and the Panama Canal to Cape Canaveral in Florida.

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SpaceX to build its Starship in Texas… for now

SpaceX was planning to build a new facility to construct its huge new vehicle designed to take people to the moon, Mars or even deeper into the solar …
starship

A SpaceX Starship prototype is assembled.

Elon Musk

For now, SpaceX will be assembling and testing its Starship prototype in Texas rather than California.

CBS Los Angeles reports that the rocket company helmed by Elon Musk has canceled a lease with the Port of Los Angeles.

SpaceX was planning to build a new facility to construct its huge new vehicle designed to take people to the moon, Mars or even deeper into the solar system.

“To streamline operations, SpaceX is developing and will test the Starship test vehicle at our site in south Texas,” reads an emailed statement from the company. “This decision does not impact our current manufacture, design, and launch operations in Hawthorne and Vandenberg Air Force Base in California. Additionally, SpaceX will continue recovery operations of our reusable Falcon rockets and Dragon spacecraft at the Port of Los Angeles.”

SpaceX and Musk have recently been showing off the development of the Starship “hopper” prototype in Texas that is set to begin short test flights this year. Musk explained via Twitter that the prototypes are being built in Texas where SpaceX has a launch site because “their size makes them very difficult to transport.”

The source info is incorrect. Starship & Raptor development is being done out of our HQ in Hawthorne, CA. We are building the Starship prototypes locally at our launch site in Texas, as their size makes them very difficult to transport.

— Elon Musk (@elonmusk) January 16, 2019

The lease with the Port of Los Angeles would have allowed SpaceX to build a manufacturing facility on a 19-acre parcel on the historic Terminal Island. The plan was for the huge assembled rockets to be then transported via barge and the Panama Canal to Cape Canaveral in Florida.

Los Angeles city councilman Joe Buscaino tweeted that he was “crushed” Musk’s company will no longer be expanding its presence at the port.

While I feel crushed about #SpaceX pulling the #SuperHeavy out of the @PortofLA, I feel confident that other innovators will see the huge value they get in San Pedro. (1/2)

— Joe Buscaino (@JoeBuscaino) January 16, 2019

The streamlining move also comes shortly after the company, based in the Los Angeles area, announced it would be laying off about 10 percent of its employees to “become a leaner company.”

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