EELV Evolved Expendable Launch Vehicle
After many years of government-funded studies on the subject of modernized launch vehicle systems, the Air Force finally developed a "roadmap" in 1994 for the acquisition of Evolved Expendable Launch Vehicles (EELVs) to replace the DELTA IIs, ATLAS IIs, and TITAN IVs then in use at the Cape.
Unlike earlier efforts to develop a new generation of space launch vehicles from a "clean sheet of paper," the EELV concept intended to capitalize on proven hardware found in the current generation of DELTA II, ATLAS II/CENTAUR, and TITAN IV vehicles. The goal was the creation of a cost-efficient and reliable family (or families) of "right size" spacelifters based on standardized fairings, liquid core vehicles, upper stages, and solid rockets. Standard payload interfaces were touted as another way to save money and improve efficiency, though success in that area remained to be seen.
EELV is important not only to reducing the launch costs of the Department of Defense, but also to the continued world-wide competitiveness of the U.S. commercial launch industry. However, the Committee is concerned that the Department is focusing too narrowly on its national security requirements and not adequately reflecting the needs of the U.S. commercial space launch industry. For example, in order to meet its projected reductions in life cycle costs, the EELV needs to capture at least 15 percent of the commercial market. This will be difficult to achieve since recent projections show that the EELV will not be able to meet the requirements of as much as 42 percent of the estimated commercial market. If that is the case, then the Air Force will have developed a new family of launch vehicles that will be primarily used only for national security payloads, resulting in higher overhead costs to DoD, while missing an opportunity to maximize the competitive posture of US industry.
The EELV competition was expected to produce the next generation of launch vehicles to replace all current medium to heavy launchers -- Lockheed Martin's Atlas, Titan II and Titan IV series, and McDonnell Douglas's Delta series -- with a single family of vehicles capable of launching medium and heavy payloads into orbit at a significantly lower cost. The EELV will handle the bulk of the U.S. government's launch requirements after the year 2000 and is also expected to be used for commercial applications.
The EELV system includes launch vehicles, infrastructure, support systems, and interfaces. The contractor is standardizing payload interfaces, launch pads, and infrastructure so that all configurations of each contractor’s EELV family can be launched from the same pad and payloads can be interchanged between vehicles in the same class (i.e., medium, intermediate, or heavy). The EELV program will maintain current mass-to-orbit capability while increasing launch rate and decreasing costs. Potential savings will be generated through the commercial launch market and shared development by government and commercial customers.
History
In May 1994, DOD's space launch modernization plan (known as the Moorman study) discussed the increasing hardware costs associated with DOD's medium- and heavy-lift launch vehicles, with particular emphasis on the heavy-lift Titan IV and its inefficient production rates. In addition, it discussed the manpower intensive aspects of launch system manufacturing and operations, also with particular emphasis on Titan IV, and the multiple launch complexes at Cape Canaveral and Vandenberg--the Air Force's two space launch ranges. The plan provided four options to alleviate these conditions--(1) sustain existing systems, including austere upgrades; (2) evolve existing systems; (3) develop a new expendable system; and (4) develop a new reusable system. DOD chose to pursue the second option as a cost-saving measure and to accommodate schedule opportunities when several satellite systems were to undergo design changes. In September 1994, the Congress provided the initial funds to develop a new family of medium- and heavy-lift expendable launch vehicles evolved from existing technologies.
In November 1994, DOD developed an Evolved Expendable Launch Vehicle (EELV) implementation plan, stating that the program objective was to reduce total cost for medium- and heavy-lift vehicle space launch. The plan summarized DOD's launch assets as including 11 launch pads, 5 launch teams, 3 launch vehicle production and processing industries, 2 launch ranges, and various support resources. It discussed an EELV program strategy to incorporate industrial competition, resulting in a single production contract that would (1) maximize common systems and components to reduce procurement costs and enhance production rates and (2) decrease the number of launch complexes, launch crews, and support requirements to reduce operation costs.
The Space & Missile System Center (SMC) released a Request for Proposal in May 1995, and four companies were awarded 15-month-long contracts on 24 August 1995 to elaborate their concepts for the EELV. The companies were: 1) Alliant Techsystems Inc. of Magna, Utah, 2) Boeing Defense and Space Group of Seattle, Washington, 3) Lockheed Martin Technologies, Inc. of Denver, Colorado and 4) McDonnell Douglas Aerospace of Huntington Beach, California. Each company’s contract was valued at $30 million.
The guidelines for EELV development reflected recent reforms implemented by Air Force Materiel Command. Fewer detailed military standards and technical requirements were levied on the contractors. Instead, fundamental requirements were emphasized, and the contractors were encouraged to lay out the details themselves. On 18 October 1995, the EELV Program Manager, Mr. Robert Steele, briefed the program’s guidelines during EELV Government Day. Among the many items covered in his presentation, Mr. Steele noted that the EELV Program Office (SMC/MV) would not provide design solutions.
Put simply, the Program Office would avoid technical leveling, technical transfusion of ideas or coaching. Unlike the Advanced Launch System (ALS), National Launch System (NLS), and Spacelifter efforts that never progressed past the study phase, the EELV initiative was designed to result in a real engineering and manufacturing effort with a family of bona fide vehicles at its conclusion. Affordability was the driving force behind this initiative, and Air Force Space Command hoped to reduce lifecycle costs between 25 and 50 percent below the $22.5 billion estimated for the current generation of spacelifters. At a minimum, the government expected the EELV family to meet the reliability found in the current stable of medium and heavy spacelifters.
Kenneth Branch and William Erskine, both residents of Cape Canaveral, Florida, were managers of Boeing’s Evolved Expendible Launch Vehicle program, which was based in Huntington Beach, California, and had facilities in Cape Canaveral. Branch was a Lockheed Martin EELV engineer who in 1996 was recruited by Erskine, a Boeing EELV engineer, to bring proprietary Lockheed Martin EELV documents to Boeing. In exchange for the proprietary Lockheed Martin documents, Branch would receive employment at Boeing, as well as a higher salary. Branch left Lockheed Martin in January 1997 and began working at Boeing on Boeing’s EELV project.
The initial phase of the EELV program, Low Cost Concept Validation (LCCV), was successfully completed in November 1996. LCCV emphasized competition in preliminary designs and risk reduction demonstrations.
On 20 December 1996, two Phase I contractors ¾ Lockheed Martin and McDonnell Douglas ¾ were each awarded a $60 million contract to complete independent 17-month-long Pre-Engineering & Manufacturing Development studies (Phase II) for the EELV. The ultimate objective of the EELV program was to reduce space launch costs by at least 25 percent while improving the Defense Department’s ability to meet "warfighter operability" requirements.
Boeing (which bought out McDonnell Douglas Aerospace in August 1997) proposed a new family of spacelifters based on a new DELTA IV launch vehicle design. To create the DELTA IV, Boeing planned to introduce a larger booster core equipped with a Rocketdyne RS-68 liquid hydrogen engine. A new upper stage based on the Single Engine Centaur design would be added along with varying numbers of new DELTA III Graphite Epoxy Motors (GEMs) to handle a wide variety of medium class payloads. For heavier missions, three DELTA IV core vehicles might be combined in a side-by-side arrangement similar to Lockheed Martin’s TITAN IV launch vehicle. Boeing intended to process the DELTA IVs under an Integrate-Transfer-Launch (ITL) concept of operations that would not tie up the launch pad for extended periods of time. The DELTA IVs would be launched from Complex 37.
At first, the government planned for these two contractors to compete for full scale development, but in 1997, it decided to keep two contractors over the life of the program because their products could be sold to a larger commercial market than originally anticipated and because two available launchers would tend to maintain competition for individual launches.
In November 1997, the US Government announced the $1.6 billion contract that would have been awarded to the best contractor for the development, manufacture and deployment of medium and heavy EELVs would be awarded as two separate contracts to Boeing and Lockheed Martin in June 1998.
The Air Force announced it wanted both aerospace companies to invest their own money in the EELV program because there was a potential for substantial profits to be made by using EELVs to launch private communication satellites. The Air Force agreed to provide both Boeing and Lockheed Martin $500 million each for development costs associated with their respective EELV program, and both Boeing and Lockheed Martin agreed to pay any additional development costs.
On July 20, 1998, Boeing and Lockheed Martin submitted bids for 28 EELV contracts being awarded by the Air Force. The total value of the contracts was $2.03 billion. On October 16, 1998, based largely on price and risk assessment, Boeing was awarded 19 out of the 28 contracts, and Lockheed Martin received the other nine EELV contracts. Boeing received $1.38 billion, and Lockheed Martin received $650 million.
During the development phase, fiscal year 1999-2002, the two contractors completed launch vehicle development, establish manufacturing capabilities, construct and modify launch site infrastructure and activate launch sites as Cape Canaveral Air Station, Fla., and Vandenberg Air Force Base, Calif.
EELV’s innovative payload-to-launch vehicle integration design and standardization of booster cores earned the program office the 1999 Defense Standardization Program National Honorary Award.
Under the Development Agreements, the contractors completed engineering and manufacturing development of the launch vehicle system, launch pads, satellite interfaces, support infrastructure, as well as demonstrate that the system meets all government requirements. The ILS contracts have been awarded to procure launch services for 28 Government missions between the two contractors (TBC, 19; LMC, 9) from 2002 – 2008.
In mid-June 1999, Erskine told another Boeing employee that he had hired Branch because Branch, while still working at Lockheed Martin, came to Erskine with an ‘under-the-table’ offer to hand over the entire Lockheed Martin EELV proposal presentation to aid in Erskine’s proposal work in exchange for a position at Boeing if Boeing won the United Sates Air Force EELV contract award."
Later in June 1999, a Boeing attorney assigned to interview Branch and Erskine regarding allegations that they possessed proprietary Lockheed Martin documents conducted a search of Erskine’s and Branch’s offices and, according to the affidavit, found a variety of documents marked "Lockheed Martin Proprietary/Competition Sensitive" in their offices.
In June 1999 Boeing informed Lockheed Martin and the Air Force that they had found a small amount of proprietary information with one of their employees. And it was not a particularly significant piece of data. And they sent a few pages of that data over to Lockheed Martin, and Lockheed Martin ultimately agreed that it wasn't very important.
In early August 1999, Branch and Erskine were terminated by Boeing. The wrongful discharge suit in Florida ultimately resulted in additional proprietary information being made known to Lockheed Martin.
The USAF EELV analysts determined that, had they known that Boeing EELV personnel had possession of proprietary Lockheed Martin EELV documents in 1997, they would have immediately suspended the competition and conducted a thorough investigation into whether the procurement competition should be terminated.
In September 2000, it was determined that softening in satellite launch demand no longer supported a need for two west coast launch providers. As a result, Boeing will continue development plans to provide launch services at both coasts, while LMC will launch solely from the east coast, moving two of its originally awarded launches to TBC. Both contractors will continue with Heavy Lift development and test programs, but as of the ILS contract, only TBC has been awarded a heavy lift launch.
In 2002, upon learning about the loss of proprietary documents, Lockheed Martin alerted the Air Force, which, in turn, informed the Defense Criminal Investigative Service (DCIS). DCIS and the Air Force Office of Special Investigations (OSI) then launched an investigation into the theft and referred the case to U.S. Attorney Debra W. Yang for the Central District of California.
The extent of Lockheed Martin proprietary material in Boeing possession at the time of EELV Buy 1 source selection was extraordinary -- approximately 25,000 pages. The quality of information was sufficient to provide great insight into Lockheed Martin's proprietary cost and pricing. Boeing was not forthcoming with the Air Force about the amount of Lockheed Martin data in its possession, and it took a period of approximately four years for them to provide us with all of it.
Air Force personnel familiar with the EELV competitive-bidding process eventually examined the Lockheed Martin’s documents recovered from Branch’s and Erskine’s work spaces at Boeing. The investigation determined that: 141 documents, consisting of more than 3,800 pages, which appeared to belong to Lockheed Martin were recovered from the work spaces of Branch and Erskine in June 1999; 36 of the documents were labeled "Lockheed Martin Proprietary or Competition Sensitive;" 16 of the documents appeared to be related to the manufacturing cost of Lockheed Martin’s EELV and, in the opinion of the USAF EELV staff, possession of these proprietary documents by a competitor could have had a "medium" or moderate chance of affecting the outcome of a competitive bid; and seven of the documents appeared to be related to the manufacturing costs of the Lockheed Martin EELV and, in the opinion of the USAF EELV staff, possession of these proprietary documents by a competitor could have had a "high" or significant chance of affecting the outcome of a competitive bid.
On 25 June 2003 Federal officials in Los Angeles charged two former Boeing Company managers with conspiring to steal Lockheed Martin trade secrets concerning a multi-billion rocket program for the United States Air Force. Kenneth Branch and William Erskine were each charged with conspiracy, theft of trade secrets and violating the Procurement Integrity Act.
In July of 2003, the Air Force suspended three Boeing integrated defense systems business units for unlawful possession of a competitor's proprietary information during the 1998 Evolved Expendable Launch Vehicle source selection. The suspensions were issued against the Boeing Company's Launch Systems, Boeing Launch Services and Delta Program business units. These suspensions, the longest suspensions of a major defense contractor, effectively banned Boeing from competing for government launch contracts. In addition, the Air Force reallocated launches under an EELV launch contract which was awarded in October 1998, and is known as Buy 1. Under this reallocation, the total number of Boeing launches was reduced from 20 to 12, and those launches were awarded to Lockheed Martin. The Air Force also awarded three additional launches under the EELV Buy 2 procurement to Lockheed Martin. The estimate of the cost to Boeing from the reallocation of launches and the suspension was about $1 billion.
Of the 19 vehicles that were initially awarded to Boeing, only seven had been ordered from Boeing. And generally speaking, the reason that the Air Force buys these vehicles or we order these vehicles two years in advance of launch is so that they can then build it. And their build cycle, generally speaking, is compatible with that two-year window.
Boeing had a clause in its current contract that gave Delta IV the only West Coast launch capability. The Air Force ended Boeing's West Coast launch exclusivity, and permited Lockheed Martin to develop a West Coast launch capability at Vandenberg Air Force Base. This will provide a second launch service capability on the West Coast for assured access to space. The Air Force going to help Lockheed Martin to contract for the upgrade to Space Launch Complex 3 at Vandenberg in the same way that the service contracted to build pad 41 on the East Coast, namely Lockheed Martin will finance it, and the Air Force will, through either their own source or through a limited liability corporation, will lease services from that pad.
By mid-2004 program costs had increased over the approved 2002 program baseline estimate of $18.8 billion, resulting from the failure of the commercial market to materialize, additional access to space and mission assurance initiatives, and several other factors such as incorrect inflation assumptions and satellite weight growth. The original set of EELV launch prices were established at a time when both companies were planning on a very strong commercial marketplace, which would allow unit reductions in price. Now the realities have changed. That market is not robust and there's very little success in the commercial marketplace. So the only answer, in order to have a successful business going forward, is to have higher prices.
Furthermore, these cost increases triggered a requirement requiring the Secretary of Defense to certify that the EELV Program is critical to national security and that revised program cost estimates are reasonable. The certification process was completed on April 26, 2004, after the Secretary of Defense's certification group identified a potential cost increase of up to $13.2 billion. This figure differs from the $13.3 billion previously reported by the EELV System Program Office because it includes some overlapping costs addressed in prior DOD acquisition reports and additional unrecognized costs such as the launch providers' infrastructure costs that will be incurred in fiscal year 2005.
In late September 2004, which it seemed the Air Force was close to being able to lift the suspension on Boeing, new information surfaced in a rather rapid way. When Darleen Druyun was sentenced and her plea agreement was made public, in early October, there were new revelations that came forth that caused the Air Force to need to do some additional investigation.
On 04 March 2005 the Air Force announced plans to allow Boeing to bid on new rocket contracts after a two-year suspension. Boeing was disciplined after the Air Force discovered the company stole documents from competitor Lockheed Martin. The Air Force wants more companies to compete for upcoming contracts and said Boeing has improved its practice of ethics since the incident.
Future Plans
On 07 April 2005 it was announced that the Air Force will evenly split 24 satellite launch contracts between Lockheed Martin and Boeing under Buy Three. The government opted to split the launches, which may be worth $100 million each, to keep both companies healthy: It wants to make sure one company is always available to launch satellites.
Buy 3 probably won't be awarded until 2006, which would probably mean they wouldn't start launching till '08. There will be a significant number of launches acquired. It will probably be for a two or three-year period.
