SpaceX has a track record of leading the way to massive changes to the aerospace industry, but until the September 1 explosion of its Falcon 9 rocket during launch at Cape Canaveral, Florida, Elon Musk’s company was mainly known for innovation and an incredibly solid safety record.
What caused the destruction that morning isn’t yet known, but the ripples are already being felt throughout the aerospace, tech industries and related industries.
The $285 million sale of Israeli satellite operator Space Communications now hangs in the balance, for example. The rocket that blew up was set to launch its Amos-6 satellite, which was destroyed along with its five-year contract with Facebook and Eutelsat Communications, based in France, which would have supplied internet access to sub-Saharan Africa.
As a result of the news of SpaceCom’s deal with Xinwei Technology Group being on the brink of disaster, SpaceCom’s stock prices have plummeted despite its efforts to renegotiate the deal. Their satellite was insured, of course, but that didn’t seem to matter much in the merger.
SpaceCom’s Satellite Insurance
Because SpaceCom’s satellite was destroyed during a pre-launch test, its much cheaper pre-launch insurance policy will be the one that will most likely cover the cost of replacing the equipment, but it could spell more expensive launches in SpaceX’s future.
For years, SpaceX has made a name for itself by streamlining launches and decreasing launch costs by at least 50 percent when compared to its competitors, making space relatively inexpensive for smaller tech companies. Even with aggressive launch time tables, SpaceX had an excellent safety record, one that even NASA and the United States Air Force felt was acceptable for its own missions.
Although SpaceX has had 27 successful Falcon 9 launches, a full investigation of the accident is still required. This may push launch dates back months or longer, and some of its many customers may not be willing to wait. If SpaceX’s clientele are scared away by higher insurance rates and delays caused by this rocket malfunction, does that spell the end of longer-term dreams for SpaceX? The company is currently working to move into handling manned spaceflights for NASA, as well as launching satellites for the Department of Defense.
Until the cause of the explosion is determined, the future of SpaceX will remain uncertain.