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IG Report On NASA’s Orion Capsule Is Not Good News.

NASA’s Orion Space Capsule was originally conceptualized in 2005 as a capsule that would get mankind to the moon and Mars.

For the first time in a generation, NASA is building a human spacecraft for deep-space missions that will usher in a new era of space exploration. A series of increasingly challenging missions awaits, and this new spacecraft will take us farther than we’ve gone before, including to the vicinity of the Moon and Mars. Named after one of the largest constellations in the night sky and drawing from more than 50 years of spaceflight research and development, the Orion spacecraft is designed to meet the evolving needs of our nation’s deep space exploration program for decades to come.

That “mission” changed somewhat when people realized that to go to Mars, what was being asked was that three astronauts would spend three years in a small capsule of 316 cubic feet. NASA then decided to design modules to fit onto the back of the capsule, but that still didn’t work. The current plan is for Orion to ferry astronauts to the moon or to another deep space system that can carry astronauts to Mars. In other words, NASA proposed, designed, started building and testing a capsule that would not be able to complete the mission of going to Mars that is was supposed to do.

NASA’s Office of the Inspector General has released a report on the Orion project and people should be upset if not outraged:

We found that NASA’s exclusion of more than $17 billion in Orion‐related costs has hindered the overall transparency of the vehicle’s complete costs. Both federal law and NASA policy call for a Life Cycle Cost estimate for all major science and space programs costing more than $250 million, and for the Agency Baseline Commitment (ABC) to be based on all formulation and development costs. The Orion Program received approval from the NASA Associate Administrator to deviate from those requirements, resulting in exclusion of $17.5 billion in Orion‐related costs from fiscal year (FY) 2006 to FY 2030 due to the Agency’s tailored approach to program management and cost reporting. Although these exclusions have been approved, the tailoring of these cost reporting requirements significantly limits visibility into the total amount spent on development and production efforts.

We also found that Orion has continued to experience cost increases and schedule delays. Since the cost and schedule baseline was set in 2015, the program has experienced over $900 million in cost growth through 2019, a figure expected to rise to at least $1.4 billion through 2023. At the same time, the program’s schedule for Artemis I has slipped more than 3 years, while the schedule for Artemis II has slipped 2 years. Additional delays are likely as both Orion and SLS complete development efforts for Artemis I in the next 16 months and prepare for Artemis II. Meanwhile, Orion is proceeding with production of crew capsules for future Artemis missions before completing key development activities, increasing the risk of additional cost growth and schedule delays as issues are discovered late in the development effort, potentially requiring costly rework.

Further, NASA’s award fee practices have hindered the program’s control of contract costs. Given the Orion Program’s significant cost increases and schedule delays, we found that NASA has been overly generous with award fees provided to Lockheed. From contract inception in 2006 through January 2020, Lockheed received $740.9 million in award fees. We attribute these overly generous award fees to the subjective nature of award fee evaluations coupled with nebulous and dated criteria used by the program. The result, for both the Orion Program and frequently other NASA programs, is that adjectival ratings such as “Excellent” given to the contractor often do not accurately reflect performance shortfalls. At a minimum, we question $27.8 million in fees awarded to Lockheed from September 2006 to April 2015. In addition, we found the continued use of the “Award Fee for End-Item Contracts” clause can serve as a disincentive to contractor performance because of the second opportunity to collect unearned fees once the end-item (in this case, the Orion capsule) is delivered.

Finally, NASA has undertaken a series of development, production, and infrastructure initiatives aimed at reducing or controlling costs. These actions include modifications to the contract, award fee restrictions, new software development and cost data tracking initiatives, the use of incentive-fee and firm-fixed-price contracts, batch ordering, spacecraft component reuse, updated facilities, and reduction and consolidation of offices as development ends and production begins. While we view these initiatives as positive steps, most are in the early stages and the extent to which these initiatives will appreciably decrease Orion’s costs is unclear.

(The IG’s report is only 59 pages in total and is easy to scan and read.)

In short, NASA was hiding the true costs of the Orion program from the public. While costs rose (we hesitate to use to the term “skyrocketed” give the fact we are talking about a rocket system,) NASA had not implemented any programs or oversight to monitor and justify the overruns and increased costs.

The solutions were always to throw more money at the “problem.”

Furthermore, the fact that contractors got approval from the NASA Associate Administrator in another case of a government entity saying “we are above the law.”

As we roll up on Election 2020, we see politicians talk about fiscal responsibility, transparency and accountability. Almost every politician says that is a promise to “the people” as part of their election rhetoric.

Very few live up to that promise. Whether it is a case of getting into office and running head first into a strong, almost impenetrable wall of government morass, or saying “I can’t believe those sucker voters fell for that again!” something has to change.

We are tired of seeing elected officials and government workers talk the talk on honesty and integrity and failing to walk the walk.

Maybe we should start considering using Orion to send those folks to the moon…..on a one way trip.




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