NASA’s Mobile Launcher Costs Skyrocket
Building a second mobile launch platform for the Space Launch System (SLS) might end up costing NASA over six times the initial budget, according to an inspector general report.
In the report released on August 27, the Office of Inspector General (OIG) revealed that NASA could spend $2.5 billion on a contract with Bechtel for designing and building Mobile Launcher 2 (ML-2), which is meant for the bigger Block 1B version of SLS. This platform might not be ready until 2029.
Originally, NASA gave Bechtel the contract for ML-2 in August 2019, setting a price at $383 million and expecting delivery by March 2023. But costs went up and schedules slipped. In 2022, a different OIG audit showed the cost had jumped to $960 million, with estimates nearing $1.5 billion.
By June, NASA set a new budget of $1.8 billion for ML-2, including $168 million for NASA’s own expenses, aiming for a delivery date in September 2027. However, they still expected Bechtel to deliver it by November 2026 at a cost of $1.3 billion.
An independent review predicted the project would actually cost $2.1 billion and be delivered by January 2028. Another NASA program, Exploration Ground Systems (EGS), also saw no chance of meeting the November 2026 deadline.
The OIG now estimates Bechtel’s contract costs will keep rising, hitting $2.5 billion by 2027, which is 6.5 times more than the original contract value.
Sometimes, we wonder why costs can rise so much more than planned.
The OIG report explained that this projection is due to the significant cost increases over the past three years, issues in the design phase, and the large amount of construction work left.
NASA disagreed with the OIG’s conclusions. Cathy Koerner, a NASA official, said the OIG’s straight-line prediction doesn’t match the real situation. She pointed out that as the project shifts fully to construction, costs should improve, suggesting the OIG’s linear forecast was incorrect.
Despite NASA’s optimism, the OIG remained skeptical. They acknowledged some progress but believed it was too early to judge if Bechtel could maintain better performance and control costs during construction.
Adding to the overall cost, NASA’s share of expenses increased from $96 million initially to $168 million now. Some of this includes tasks removed from Bechtel’s contract, like building six of the eleven umbilical arms for the launch tower, which NASA will provide as government-furnished equipment.
With rising costs, the OIG warned it might stretch NASA’s budget thin. For fiscal years 2025 to 2027, NASA estimated spending $415.5 million on EGS projects, including ML-2, but that’s a 72% increase from the 2024 request. Even then, it might fall short by nearly $400 million.
According to the report, NASA has limited options to push Bechtel to cut costs. Although the contract could be changed to a fixed-price one, it’s unlikely since Bechtel would need to agree. If that happened, Bechtel would probably demand a higher price, beyond NASA’s budget, to cover extra risks.
