NASA space launch system rocket program gets slammed in internal audit

An artist’s depiction of
NASA’s Space Launch System.

NASA/MSFC

• NASA’s Space Launch System (SLS) is
  designed to be the world’s most powerful rocket — one able to
  take astronauts to the moon and
  Mars.
• However, the $12.2-billion effort to develop and launch
  the first missions is running years behind schedule and faces
  major cost overruns.
• On Wednesday, government auditors published a report
  highlighting problems with the work of NASA and Boeing, the biggest contractor for
  SLS.
• The report flagged $64 million in extra fees awarded by
  NASA, slammed Boeing for “poor performance,” and questioned the
  “long-term sustainability” of the super-rocket
  program.

NASA is trying to build the world’s most powerful rocket, called
the
Space Launch System, or SLS.

The rocket program’s goal: send American astronauts back to the
moon for the
first time in nearly 50 years, then send people to Mars later
on.

However, a new 44-page audit of the SLS
program doesn’t bode well for the program.

The report, published Wednesday by NASA’s Office of Inspector
General (OIG), digs into some of the causes behind 2.5 years of
delays and several billion dollars of projected cost overruns for
the $12.2 billion SLS program.

The report even calls into question the sustainability of the
entire project.

Auditors put much of the blame for high costs and delays on
Boeing, one of the prime SLS contractors. The company is
responsible for about 56% of the new rocket’s cost, but is years
behind-schedule in delivering the biggest section of the
rocket.

“Our audit work determined that the cost increases and schedule
delays can be traced largely to management, technical, and
infrastructure issues driven by Boeing’s poor performance,” Ridge
Bowman, a director within NASA OIG, said in a video about the audit.

But the report also slammed NASA for its weak oversight.

“We also fault at NASA for several poor contract management
practices [that] we found contributed to SLS program cost and
schedule overruns,” Bowman said.

What the government audit found

A
test version of a tank for Boeing’s core stage, the largest
component of NASA’s Space Launch System.

Judy
Guidry; NASA/MSFC Michoud

NASA OIG said this is the “first in a series of audits” focusing
on the agency and its contractors.

The findings raise new doubts about any timely or affordable
completion of the roughly 36-story rocket system — or the suite
of ambitious lunar and Martian expeditions that it’s supposed to
make possible.

Auditors determined that NASA is slated to run out of money for
SLS about three years earlier than planned, and that Boeing’s
work on the first core stage of the rocket will be “double the
anticipated cost.”

Boeing is responsible for some of the largest components of the
multi-stage rocket. One of those parts is the SLS’ core stage —
the largest section of the rocket. Boeing was supposed to deliver
that in time for a December 2017 launch, but it’s still not
complete.

Boeing is also making an advanced “exploration upper stage,” or
EUS. The company was supposed to have ready for a NASA mission in
mid-2021, but current estimates suggest it won’t be ready until
about mid-2022.

Auditors made seven major recommendations to NASA to avoid
further delays and billions’ worth of additional costs. Some
suggestions focused on renegotiating vague contracts with Boeing,
while others pushed NASA to rethink an awards system designed to
provide monetary incentives for cost control, technical
execution, management, and more.

But that awards system qualitatively judges Boeing on its
service, rather than on delivery of hardware. Auditors said that
NASA too generously assessed Boeing’s ongoing work as “very good”
or “excellent” — grades that awarded the company about $234
million in bonus money.

Those grades were given even as Boeing ran behind schedule on its
commitments and asked for more money to complete work on the same
components. Auditors specifically said they “question” about $64
million awarded by NASA through the grading system.

The first planned configuration of SLS is called “Block 1,” and
it’s now nearly 3 years behind-schedule. Block 1 may launch an
Orion space capsule around the moon (without any crew). NASA is
also eyeing it as a way to launch Europa Clipper, a mission
designed to explore an icy moon of Jupiter that
harbors a salty ocean.

Two later and more-powerful configurations — “Block 1B” and
“Block 2,” which will use Boeing’s exploration upper stage — have
also been delayed.

A diagram showing NASA
plans for the Space Launch System through
2028.

NASA
OIG

Although the report was critical, it did praise NASA and Boeing
for being proactive in reeling in extra costs and delays to SLS.

One of the “positive steps” noted by the audit: A NASA employee
was pulled off the program after he approved $318 million in
contract work when he was only allowed to approve $2.5 million.

How Boeing and NASA responded to the report

An
illustration of a Lunar Orbital Platform-Gateway concept for NASA
by Boeing.
Boeing

Auditors provided a draft of their report to NASA before it was
published and gave the agency time to respond. But in the final
version, the inspectors noted that NASA didn’t adequately respond
to a key recommendation and rejected another on a technicality.

“We believe a lack of action by senior leadership in both
organizations to correct identified problems remains a
significant cause of the SLS Program’s cost increases and
schedule delays,” the report said. “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.”

William Gerstenmaier, NASA’s associate administrator for human
exploration and operations, said the report was “a fair
assessment” of the situation. But he emphasized the difficulty of
the task at hand.

“[SLS] is the largest launch system in the history of
spaceflight,” Gerstenmaier said. “The design, development,
manufacturing, testing, and operations of the system are highly
complex and represent a national investment in a long-term
commitment to deep space exploration.”

Boeing also responded to the report in part by highlighting the
difficulty of the endeavor.

“An unprecedented rocket program has inherent challenges;
developing the first unit of a system that will safely carry
humans into space, even more so,” a Boeing spokesperson told
Business Insider in an email. “Boeing recognizes the importance
of the SLS program to the nation and to the future of human space
flight, and we are committed to its continued success.”

The company also said it has already shuffled program managers
and that it’s refining “approaches and tools to ensure a
successful transition from development to production” of the SLS
hardware.

The company added that the changes it has already made mean “the
program described in the OIG’s report does not represent the …
program today.”

Still, NASA’s investment in SLS is likely to balloon
significantly as the agency works toward developing a “gateway”
space station to orbit the moon.

If the agency were to attempt to send humans to Mars after a
series of lunar exploration trips, NASA OIG estimates the cost of
getting to Mars might exceed $210 billion. And that’s not
even to set foot on the Martian surface —
just to have astronauts orbit the red planet.

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