In Brief
The U.S. Air Force's recently released budget reveals that the cost of a SpaceX launch is dramatically lower than that of the traditionally used United Launch Alliance. As CEO Elon Musk pointed out via Twitter, SpaceX's launch costs are so much lower, the satellites used by the company are "basically free."

Undercutting the Competition

In 2014, the Government Accountability Office (GAO) released a report on the costs to launch spacecraft. In it, they criticized the lack of transparency that characterizes the prices and processes of the United Launch Alliance (ULA), a joint venture between Boeing and Lockheed Martin. However, until recently, the government didn’t really have any other options for launches, so the ULA had neither an incentive to increase pricing transparency nor a motivation to lower prices.

SpaceX is changing that in a major way.

The U.S. Air Force recently released their 2018 budget estimates, which include numbers through the early 2020s. The budget combines the entire launch price into a single per launch “unit cost.” For fiscal year 2020, that very high unit cost is $422 million, and it increases to $424 million one year later. In contrast, the SpaceX cost for basic commercial launches of the Falcon 9 rocket is around $65 million, a difference CEO Elon Musk was happy to point out via a tweet.