What's next for SpaceX's (very expensive) Starship program?

Transcript

JUANA SUMMERS, HOST:

The commercial company SpaceX is trying to build a rocket that can one day take people to the moon and Mars. Making it work is costing billions of dollars. NPR's Geoff Brumfiel reports on whether the company might be trying to fly too high.

GEOFF BRUMFIEL, BYLINE: The rocket is called Starship, and it is a stainless steel beast of a machine. When it lifted off last month, SpaceX employees cheered as they watched the video feed.

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UNIDENTIFIED GROUP: Five, four, three, two, one.

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BRUMFIEL: They kept cheering as the massive rocket pulverized the concrete under its launch pad, as one of its engines appeared to explode on the way up and even when it began to somersault out of control and disintegrate over the Gulf of Mexico.

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BRUMFIEL: None of that was supposed to happen. But SpaceX's employees didn't seem to mind, nor did the company's founder, Elon Musk.

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ELON MUSK: The outcome was roughly what I expected.

BRUMFIEL: That was Musk speaking on Twitter recently about the flight test. Starship is an innovative design, the biggest rocket ever built. It wasn't supposed to work on the first try. Musk says SpaceX will spend $2 billion on Starship this year alone. His longtime dream is that it will travel to Mars.

MUSK: We're going to solve the issues that are remaining, and we'll get it to orbit, and we'll make it reusable. And that means that we have a real path here to get humanity to Mars.

BRUMFIEL: But making humans an interplanetary species in this economy - that's a lot for SpaceX to take on. And it's not the company's only big project. SpaceX is also building a costly satellite internet service called Starlink. SpaceX is a private company, so its finances aren't known. But most analysts agree between launching thousands of satellites to blanket the Earth with internet service and preparing for a visit to Mars, it's losing money.

CHRIS QUILTY: It's hard to imagine how they could be generating cash with those level investments.

BRUMFIEL: Chris Quilty is president of Quilty Space, a company that tracks the space industry. SpaceX does make money launching commercial and government satellites on its existing rockets. But Quilty and other analysts believe Starship and Starlink will keep it in the red for a while.

QUILTY: Until Starship is flying and the development costs are down and it's generating revenue instead of consuming cash and until, you know, they start getting new Starlink satellites on orbit, you know, I think it's - it'll be a challenge for him.

BRUMFIEL: That would be a problem for most space companies, but SpaceX is different. It's valued at close to $140 billion, making it one of the biggest private companies in the country. And investors have been lining up to plow money into its big projects.

CARISSA CHRISTENSEN: SpaceX has consistently raised money and even in this, you know, more constrained environment, seems to be able to raise substantial amounts.

BRUMFIEL: Carissa Christensen is CEO of BryceTech, an analytics and engineering firm. In addition to private investment, SpaceX has won around $4 billion in contracts from NASA to develop Starship into a lander that can put astronauts on the moon. That government money should help keep the project going.

CHRISTENSEN: I think that being one of the core players in a well-funded, well-supported return to the moon by the government is very, very valuable from Starship's perspective.

BRUMFIEL: In his briefing on the rocket, Musk said he did not anticipate needing to raise more money for SpaceX in the near term, but Chris Quilty says at some point he believes SpaceX will have to raise more capital.

QUILTY: I suspect over the next couple of years, they will continue to need to tap the markets for more cash.

BRUMFIEL: This first test shows that SpaceX had the funding and vision to get Starship off the ground.

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UNIDENTIFIED PERSON: Everyone here is absolutely pumped to clear the pad and make it this far into the test flight.

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BRUMFIEL: But whether investors are willing to take SpaceX to the moon and beyond remains to be seen. Geoff Brumfiel, NPR News.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.