SpaceX vs. Blue Origin: NASA made a huge intervention in the race

The new space race drama continues.

On Friday, Blue Origin officially lost its lunar lander appeal, with the Government Accountability Office rejecting its protests over NASA’s decision to partner with SpaceX for the development of its human landing system.

In response, Blue Origin remained firm its argument that there are “fundamental issues” with NASA issuing a single award. NASA, meanwhile, issued this response:

“The decision enables NASA to award the contract that will ultimately result in the first crewed demonstration landing on the surface of the Moon under NASA’s Artemis plan. Importantly, the GAO’s decision will allow NASA and SpaceX to establish a timeline for the first crewed landing on the Moon in more than 50 years.”

What’s new — On the surface, the decision seems like a big setback for Blue Origin. The Jeff Bezos-backed firm is facing off against Elon Musk’s SpaceX in an increasing number of areas, but SpaceX’s proven track record leaves Blue Origin at a disadvantage.

Musk’s firm will now provide the vehicle that lands humans on the Moon for the first time in over 50 years, a powerful symbolic victory. The decision by NASA to go with SpaceX was made back in April: The organizations are now working together to perfect the reusable Starship human landing system (HLS). It’s expected to take astronauts to the Moon in 2024 as part of the Artemis mission.

During the first space race, reaching the Moon in 1969 led observers to declare the United States the winner (even though the Soviet Union got to space first).

But just as the first Moon landing wasn’t the end of Soviet space exploration, SpaceX’s Moon landing doesn’t mark the end of Blue Origin’s efforts. Dallas Kasaboski, a senior analyst with Northern Sky Research, tells Inverse that the Artemis mission is a step toward a broader Moon economy.

“Companies like Blue Origin may have lost out for now, but they should not expect the market to close up after the first lap,” he says.

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SpaceX versus Blue Origin: What was agreed with NASA?

NASA invited three American companies to develop human landers and compete for its Moon mission. These included:

1. Blue Origin, working with Lockheed Martin, Northrop Grumman, and Draper. The group designed a three-stage integrated lander vehicle. Blue Origin would provide the descent element, built with the BE-7 cryogenic engines it’s developing.
2. Dynetics, which brought together more than 25 subcontractors for its human landing system.
3. SpaceX, which proposed using the Starship rocket as a human lander. The rocket is currently under development at the firm’s Texas facility and is designed to support its most ambitious missions like a crewed trip to Mars.

In April, NASA announced SpaceX won the contract. NASA’s assessment described SpaceX’s $2.89 billion price tag as “the lowest among the offerors by a wide margin.” It also scored highly in management assessments:

Dynetics and Blue Origin subsequently filed a protest with the Government Accountability Office describing the process as “flawed.”

Blue Origin explained that it originally bid $5.99 billion for the award at a point when NASA suggested it could select two teams. SpaceNews notes that NASA asked for $3.3 billion in government funding for the project for the fiscal year 2021, but only received $850 million.

“Blue Origin could have and would have taken several actions to revise its proposed approach, reduce its price to more closely align with funding available to the Agency, and/or propose schedule alternatives,” the firm wrote.

In its statement rejecting the protest, the GAO claimed that NASA’s announcement “reserved the right to make multiple awards, a single award, or no award at all.”

What does the decision mean? — At its most basic level, the decision leads on from the report’s conclusions: SpaceX's solution is cheaper and beats the competition on other metrics.

“In the end, this is not great news for Blue Origin or other players,” Kasaboski says.

“NASA is pushing to keep the program moving forward, and SpaceX's low bid and heritage of meeting demand have helped it win and keep this deal.”

But in the short term, the decision may not change much. Laura Forczyk, the founder of space consulting firm Astralytical, tells Inverse the protest never “had much of a chance of succeeding.”

Forczyk says Bezos’ open letter sent July 26 suggests the next steps. The letter, addressed to NASA administrator Bill Nelson, makes the case for supporting more than one firm to build a human lander system. Perhaps most importantly, it promised to waive up to $2 billion in government payments for the current and next two fiscal years.

It won’t be for the current SpaceX contract, but Forczyk says that NASA intends to award other contracts for Artemis. Blue Origin could squeeze through then.

“I think that that ultimately will work,” she says. “Because Blue Origin seems to have politicians on their side.”

What happens next — Beyond lunar landers, there’s likely to be other opportunities for the two firms in space. After all, the Artemis program is aimed at encouraging further space development rather than serving as a one-off mission.

The Moon might not even be the ideal end goal. Forczyk notes that Bezos’ long-term dream is to build giant space cities orbiting the Earth. These cities could enable humanity to reach a population of one trillion.

Musk, on the other hand, is aiming for Mars. His goal is to send the first humans to the red planet by the mid-2020s. This would act as a stepping stone to building a self-sustaining city by 2050. SpaceX’s headquarters even shows an artist’s impression of a terraformed Mars.

Getting to the Moon first is a cool symbolic win, but in the multi-faceted new space race, it’s not the ultimate goal for either firm.

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