NASA's Mars rocket is behind schedule and over budget due to 'Boeing's poor performance,' audit finds

Authored by orlandosentinel.com and submitted by chabeliherrera

Years of delays and billions of dollars of cost overruns have marred Boeing’s building of key components of a next-generation rocket that one day is meant to take humans to the moon and Mars, according to a scathing audit released Wednesday by NASA’s Office of the Inspector General.

The report also found that in addition to Boeing’s mistakes, NASA was being overly generous with its evaluations of the company, leading to questionable payments.

Under a NASA contract, Boeing is currently building two core stages for the Space Launch System, a heavy-lift rocket that will carry the Orion spacecraft and astronauts into deep space. Boeing’s contract is the largest in the Space Launch System program, comprising more than 40 percent of the program expenditures

Boeing’s parts will be integrated with other components of the rocket at Kennedy Space Center, before they launch from the Space Coast.

But the project is behind schedule and grossly over budget, partially as a result of “Boeing’s poor performance,” according to the report, the first in a series of audits of the Space Launch System program.

“With $5.3 billion spent as of July 2018, NASA expects Boeing to exhaust the contract’s current value by early 2019, nearly three years before the contract is supposed to end and without delivering a single core stage or the [exploration upper stage],” said Ridge Bowman, director of the NASA OIG.

At the current rate, the report found that Boeing will spend at least $8.9 billion through 2021 — “double the amount initially planned — while delivery of the first core stage has slipped 2 ½ years from June 2017 to December 2019 and may slip further.”

On a call with reporters last week, Boeing’s Space Launch System vice president and program manager, John Shannon, said the project is on track to deliver the first core stage for the rocket to Kennedy Space Center by the end of the year, where it will be integrated with the other components.

But the report disputed that estimate, saying Boeing would need an infusion of $1.2 billion through a renegotiated NASA contract for it to meet its goal of delivering to the Cape in December 2019 and then holding a test flight in June 2020. That doesn’t count the billions that would be needed to ensure delivery of the other components of Boeing’s contract.

“In light of the development delays, we have concluded NASA will be unable to meet its [Exploration Mission-1] launch window currently scheduled between December 2019 and June 2020,” the report said.

The Office of Inspector General assessed NASA's management of the Boeing contract developing the Space Launch System’s (SLS) Core Stages and Exploration Upper Stage, key parts of t ... The Office of Inspector General assessed NASA's management of the Boeing contract developing the Space Launch System’s (SLS) Core Stages and Exploration Upper Stage, key parts of t ... SEE MORE VIDEOS

For its part, Boeing says the report is outdated and doesn’t reflect the changes Boeing has made to correct its past mistakes.

“An unprecedented rocket program has inherent challenges; developing the first unit of a system that will safely carry humans into space, even more so,” the company said. “We have restructured our leadership team to better align with current program challenges and we are refining our approaches and tools to ensure a successful transition from development to production.”

The OIG report conceded that Boeing has taken “positive steps” to stay on track, including “making key leadership changes; requesting reviews of Boeing’s management, financial, and estimating systems; adding routine, in-depth performance reviews; and changing the procurement process to improve.”

But Boeing wasn’t the only one to make mistakes. According to the OIG report, NASA also played a role by mismanaging the contract and failing to keep track of Boeing’s spending. The lack of transparency meant NASA did not know how much a single core stage of the rocket cost.

The space agency was also found “inflating the contractor’s score and leading to overly generous award fees” in six evaluation periods since 2012 — when Boeing was awarded the contract. That led to $323 million in paid fees, of which nearly $64 million were found to be questionable by the audit.

The report offered seven recommendations to NASA, six of which the agency has agreed with.

“NASA and Boeing are well underway in implementing the report’s recommendations, several of which are already yielding steady and significant improvements,” NASA said in a statement. “NASA continues to carefully monitor SLS performance as the teams make significant progress.”

As to the future of the project, plans are on hold for additional core stages for future missions. The SLS rocket won’t be reused, but instead built for each trip, including a potential science mission to Jupiter’s moon Europa in 2022. That timeline is now likely to slip, too.

According to the audit, “Unless senior officials at NASA and Boeing are involved and collectively agree to the solutions, launch dates will continue to slip and the costs will increase, raising questions about the program’s long-term sustainability.”

Courtesy of NASA This artist rendering shows a wide-angle view of the liftoff of the 70-metric-ton crew vehicle configuration Space Launch System rocket from the launchpad at Kennedy Space Center. This artist rendering shows a wide-angle view of the liftoff of the 70-metric-ton crew vehicle configuration Space Launch System rocket from the launchpad at Kennedy Space Center. (Courtesy of NASA)

The future of Space Launch System

But does the audit mean the Space Launch System rocket may never lift off? For a program that has major support from Congress, with nearly $12 billion poured into it so far and the participation of 1,100 contractors across 43 states, that’s not likely, said Laura Seward Forczyk, owner of space consulting firm Astralytical.

“It’s not necessarily about performance, it’s about funding that is being allocated to key areas, key districts and key states,” Seward Forczyk said. “It’s about the Senate saying they are creating a large program for their constituents.”

Ironically, one of the issues Boeing faced on the Space Launch System was rushing to hire more employees when it realized it had underestimated the workload — and struggling to find qualified personnel. It took the company four to six months to find enough staff, “which according to NASA officials, was a significant weakness,” the report found.

Ultimately though, it’s really a lack of incentive to meet deadlines that has stalled the rocket’s launch, Seward Forczyk said.

The Soviet Union isn’t breathing down NASA’s neck anymore, and the success of the commercial space industry in heavy-lift rocketry is still untested.

“If you see those two rockets [SpaceX’s Falcon Heavy or Big Falcon Rocket and Blue Origin’s New Glenn] come into operation and have a successful track record, if you continuously see a successful track record, that might be an incentive … for the administration and Congress to then start to change direction,” Seward Forczyk said.

Girlsinstem on October 10th, 2018 at 18:15 UTC »

As a former Boeing engineer, this is not shocking at all. Management, especially on projects like this, is bordering on incompetent. Process bloat has driven up costs tenfold. Combined with them continuing to hire inexperienced engineers because they are cheap and their long herald tradition of zero knowledge transfer, the only surprise here is that it took this long for the dam to break.

Mossbackhack on October 10th, 2018 at 16:54 UTC »

This is what happens when space programs are funded more as a regional employment project and not as an actual results oriented endeavor.

Senno_Ecto_Gammat on October 10th, 2018 at 16:27 UTC »

Right from the OIG Report:

WHAT WE FOUND

At its current rate, we project Boeing will expend at least $8.9 billion through 2021—double the amount initially planned— while delivery of the first Core Stage has slipped 2 ½ years from June 2017 to December 2019 and may slip further.

Between June 2014 and August 2018, Boeing spent over $600 million more than planned on developing Core Stages 1 and 2, and NASA officials have confirmed that in FY 2018 alone Boeing expended $226 million more than planned. Cost increases and schedule delays of Core Stage development can be traced largely to management, technical, and infrastructure issues driven by Boeing’s poor performance. For example, Boeing officials have consistently underestimated the scope of the work to be performed and thus the size and skills of the workforce required. In addition, development of command and control hardware and software necessary for Core Stage testing is 2 years behind schedule, while equipment-related mishaps and an extreme weather event contributed to cost and schedule delays. Individually, each of these issues may have caused only minor cost and schedule problems, but taken as a whole they have resulted in a 2 ½-year slip to the SLS Core Stage delivery schedule and approximately $4 billion in cost increases for development of the first two Core Stages. Furthermore, Boeing’s cost and schedule challenges are likely to worsen given that the SLS has yet to undergo its “Green Run Test”—a major milestone that integrates and tests the Core Stage components.

Ouch.

Also, now that I read more, this is interesting:

As NASA and Boeing struggle with completing the first two SLS Core Stages, the Agency’s plans are on hold for acquiring additional Core Stages. Given that NASA officials estimate needing 52 months of lead time from issuing a contract to delivery, the earliest a third Core Stage can be produced is 2023, jeopardizing planned launch dates for future missions that require the rocket, including EM-2 and potentially a science mission to Europa.”

This is the report Eric Berger was looking at when he said: "Work on the EUS has effectively stopped."

And that's what Scott Manley's tweet about the upper stage stop work order is about: there's no sense in building an upper stage if you don't have a core stage.

Edit: Berger just published his take on Ars:

However, there are a few critics close to the White House who have been whispering concerns and criticisms about the big, expensive rocket to Vice President Mike Pence, who leads the National Space Council. To be clear, the vice president has been publicly supportive of the SLS rocket to date. But this report will at the very least add fuel to the fire of the criticisms he is hearing.