SpaceX just stole the space tourism market from Virgin Galactic and Blue Origin

For three long years, two companies have dueled to dominate the nascent space tourism market. But that’s about to change.

2021 featured inaugural space launches from both publicly traded Virgin Galactic (SPCE -3.38%) and Blue Origin, owned by Jeff Bezos, each of which has successfully delivered private space tourists to the edge of space (about 60 miles up) and then brought them home again safely. To date, Virgin Galactic has now flown a total of seven commercial “Galactic” flights carrying paying space tourists on its Unity spacecraft. Blue Origin’s New Shepard suborbital rocket has carried space tourists eight times.

That’s great and all, but here’s the thing: the actual time in space that both companies have given their customers has been a few minutes at most. When you pay Virgin Galactic $250,000, $450,000, or even $900,000 for a space ticket, it’s not a lot of money. And while Blue Origin still doesn’t publicly advertise its prices, Quartz.com reported in 2022 that a ticket broker paid $2,575,000 for a pair of tickets on a recent Blue Origin flight. At nearly $1.3 million a piece, it’s even more expensive.

It really could too expensive?

SpaceX and space tourism

Two years ago, as the space tourism race was just accelerating, I explained how SpaceX’s gigantic Starship rocket, capable of carrying 100 passengers at a time and launching for $10 million a trip, threatened to disrupt this last space race even before hers. really started. A launch cost of $10 million, divided by 100 space tourists, implied that SpaceX could one day offer a price per ticket of $100,000 and undercut prices being charged by both Virgin Galactic and The blue origin.

SpaceX isn’t quite there yet, but that seems to be the direction they’re headed.

Consider: Just last week, SpaceX conducted a successful space tourism flight, Polaris Dawn, in which four non-NASA astronauts flew into orbit 450 miles above Earth (three times the height of the International Space Station) and there they performed the first spacewalk. tourist spacewalk. Two astronauts, Polaris Dawn pilot and sponsor Jared Isaacman and SpaceX engineer Sarah Gillis, exited their Crew Dragon space capsule wearing SpaceX-built spacesuits, each spending about 10 minutes outside the spacecraft.

Later, after completing their five-day mission, the entire crew returned to Earth to splash in the ocean.

Price of Polaris Dawn

Of course, the cost of the Polaris Dawn mission is nowhere near the prices that Virgin Galactic and Blue Origin charge for their space tourism tickets. In a recent report on commercial crew missions to the ISS, Payload Space calculated that SpaceX charges about $72 million per seat for NASA astronauts (up from $55 million per seat in 2019). A recent one Forbes In addition, the magazine article pegged the price of the Crew Dragon seats charged by Axiom Space at approximately $41.9 million.

Therefore, even at the low end of the range, SpaceX charges a lot more for its space tourism flights than for Virgin Galactic or Blue Origin.

Or does it?

The mathematics of space tourism

Consider: The lowest advertised price for space tourism seats on Virgin Galactic or Blue Origin is $250,000. Even divided by a generous 10 minutes in space, this works out to a cost per minute of $25,000 per minute.

Instead, suppose SpaceX charged NASA the rate of $72 million per seat on Polaris Dawn, a mission that lasted five days or 7,200 minutes. I don’t even need a calculator to figure out its cost per minute. That’s $10,000 per minute, per passenger, 60% off what Virgin Galactic and Blue Origin charge!

And here’s another fact that future investors in Virgin Galactic (or any future Blue Origin IPO) need to consider: SpaceX is just getting started, and the Crew Dragon only carries four passengers per flight. Against a nominal capacity of seven, this made the Polaris Dawn relatively more expensive per site than must be absolutely necessary to cover the cost of launching a Falcon 9 rocket. SpaceX TO charge less for future flights that carry more passengers. It could also offer longer flights, giving space tourists more bang for their buck — or it could do both.

Meanwhile, the math will shift even more in SpaceX’s favor as it irons out the bugs in the Starliner and approaches the ultimate goal of being able to send 100 passengers into space at once, at a cost measured in the thousands of dollars per ticket, more rather. than millions.

Space tourism may not be SpaceX’s most important goal in spaceflight. But the numbers tell me it’s still a market SpaceX can dominate if it wants to.