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Steve Baker
Blogger at LetsRunWithIt.com (2013–present)Dec 1
Does SpaceX really risk bankruptcy with the Raptor crisis or is Elon Musk being over dramatic?
Originally Answered: Does SpaceX really risk bankruptcy with the raptor crisis or is Elon Musk being over dramatic (
https://spaceexplored.com/2021/11/29...ptor-crisis/)?
I think it would be a very long/slow death for the company - and it would be somewhat avoidable - but I don’t think Elon is exaggerating much.
SpaceX are spending a TON of money on the StarShip program - and have commitments to NASA and to the #DearMoon project to complete it…and (of course) Elon Musk is determined to start a Mars colony.
The money to pay for that cannot come from SpaceX’s Falcon-9/Heavy launch profits…there simply isn’t enough money to cover the eye-watering costs of this rapid pace of development.
Hence the StarLink (satellite internet) service is an essential part of StarShip development…it’s “a license to print money”…but that money is what pays to get to Mars.
STARLINK - THE CASH COW:
However, StarLink is at a crisis point. They’ve launched enough Mk 1 satellites (aboard Falcon-9’s) to prove that it’ll work and to get enough customers to show that there is interest in it.
However, Mk 1’s can only talk to ground stations - so if you live someplace under the flight path of the Mk 1 satellites - and you want to (say) visit Quora.com then you send a request to the nearest satellite which has to relay that message to a ground station which sends the message off to download Quora’s front page. When the response comes back, it has to go to the ground station which then sends the data up to the satellite - which then relays it back to your dish.
But for this to work, the satellite has to be able to “see” both your StarLink dish AND the ground station. Although the satellite is 350 miles up above the Earth, it can only see ground stations within a couple of hundred miles.
This means that SpaceX have to build a massive number of ground stations - which is expensive - and if you live too far from a ground station, you can’t buy service.
THE MK II STARLINK:
However, all of this messing around with ground stations is NOT the long-term plan.
Enter the Mk II StarLink satellite.
This version is larger and heavier than the MK I and has equipment on board to send and receive data from other MK II’s via a laser link.
So now - no matter where you live - you send a message to the nearest satellite - it figures out which other satellite is closest to Quora headquarters - and sends the message from one satellite to the next until it reaches the right place and THEN sends the message to the ground station.
This means that SpaceX don’t need many ground stations - in fact, just one ground station could (theoretically) service the entire world.
But the snag here is that while you can fit 60 Mk I StarLinks into a Falcon-9, you can’t get anywhere near that number of the larger/heavier Mk II’s.
This means that SpaceX can’t get ahead on StarLink without having StarShip working.
StarShip could probably launch 400 StarLink’s at a time (!!) - so the Mk II network could be launched amazingly quickly - and much money earned.
CHICKEN AND EGG SITUATIONS:
So SpaceX are in a bind.
To get StarLink to full profitability, they need to be able to launch StarShip to orbit - and to get to the 12,000 satellites they need - they’ll need 30 StarShip launches to orbit.
But to get StarShip launching on a regular basis, they need a ton of money…which means that they need StarLink to be earning money.
Elon Musk isn’t stupid - he has a degree in economics - so I’m quite sure he figured this out…get JUST enough money from StarLink to pay for JUST a couple of StarShip launches…which earns more StarLink money…which pays for more StarShips.
However, THREE simultaneous problems are biting him:
The FAA decided to do a major audit of the SpaceX facility in Boca Chica - which has tossed a wrench into the StarShip testing program. They’ve been refusing to grant launch permits for many months now.
The “chip shortage” has limited the number of StarLink dishes that can be made - and for some customers (myself included) the shipping date for the dish has slipped an entire YEAR.
Evidently, something very bad has been happening at the SpaceX Raptor rocket motor factory. We’re not sure what it is - but it resulted in several senior managers being fired - and accusations that they were hiding production problems from Elon. (HINT: DO NOT PISS OFF ELON!).
THE PERFECT STORM:
A shortage of rocket motors when doing sub-orbital testing of StarShip wasn’t too serious.
They could test launch with just three of the six motors on StarShip (because three of them are “vacuum optimised” and not needed at low altitudes).
But now they are ready for orbital testing, they’ll need 28 motors for the SuperHeavy and all 6 motors for the StarShip.
And until they manage to stick a landing with SuperHeavy - they’re going to waste all of those engines with every single test flight.
This wouldn’t have been so bad because even if they couldn’t stick a landing (which is the hard part) - just getting a StarShip up to orbital speed would be enough to allow each test flight to launch hundreds of Mk II StarLinks - more than enough to pay for the destruction of another StarShip+Superheavy.
But to do that, the planned manufacturing rate of Raptor engines was supposed to reach one engine per day…allowing them to do a test launch (with 400 MkII StarLinks) about once a month until they became able to re-use SuperHeavy.
With SuperHeavy sticking it’s landings, StarShip could fly once a week - even if it couldn’t land.
But until they can get the complicated “capture” landing system working, any slowdown in rocket motor production will have a direct impact on StarShip orbital flights.
Add to this the enforced delay from the FAA - and things start to look very bad for SpaceX.
SO WOULD THIS AMOUNT TO “BANKRUPTCY”?
I don’t think it would be THAT bad.
If Raptor engine production failed - and StarShip failed - and StarLink (Mk II) didn’t get completed - the “core business” of SpaceX is still in it’s Falcon-9/Heavy launches.
So they could possibly kill StarShip - not do more than modest ground station growth with Mk I StarLinks - and make enough money to weather the storm.
CONCLUSION:
From Elon Musk’s perspective - this is **DEATH** to the goals of SpaceX (to become a multiplanetary species).
But from the perspective of the rest of the world, the market for Falcon-9 launches will keep the company afloat - and SpaceX is STILL the biggest launch company in all of history.
So we can only hope that he can figure out the problems with the Raptor factory - and that the FAA get their act together and start licensing launches.
But without understanding precisely WHAT is going on with Raptor engine manufacturing and WHY the management at the factory were (allegedly) covering it up…it’s very hard to make predictions.
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