Space Launch System: Resources Need to be Matched to Requirements to Decrease Risk and Support Long Term Affordability
Highlights
What GAO Found
The Space Launch System (SLS) program is making solid progress on the SLS design. However, the National Aeronautics and Space Administration (NASA) has not developed an executable business case based on matching the program's cost and schedule resources with the requirement to develop the vehicle and conduct the first flight test in December 2017 at the required confidence level of 70 percent. NASA uses a calculation referred to as the “joint cost and schedule confidence level” to estimate the probable success of a program meeting its cost and schedule targets. NASA policy usually requires a 70 percent confidence level for a program to proceed with final design and fabrication. GAO's work on best practices has shown that programs that do not establish an executable business case that matches requirements—or customer needs—to resources, such as schedule and funding—are at increased risk of cost and schedule growth. The program is satisfying many of NASA's metrics that measure progress against design goals, such as requirements for design maturity. According to the program's risk analysis, however, the agency's current funding plan for SLS may be $400 million short of what the program needs to launch by 2017. Furthermore, the development schedule of the core stage—which drives the SLS schedule—is compressed to meet the 2017 launch date. NASA also faces challenges integrating existing hardware that was not originally designed to fly on SLS. For example, SLS is using solid rocket boosters from the Constellation program, but integrating a new non-asbestos insulating material into the booster design has proven difficult and required changes to the booster manufacturing processes.
The SLS program has not yet defined specific mission requirements beyond the second flight test in 2021 or defined specific plans for achieving long-term goals, but the program has opportunities to promote affordability moving forward. NASA plans to incrementally develop more capable SLS launch vehicles to satisfy long-term goals, but future missions have not been determined, which will directly affect the program's future development path and flight schedule. Mission selection will likely determine which element the program decides to develop next, as the program can afford to develop only one element at a time. The magnitude of these development efforts could be significant but is currently unknown as the program has not developed complete life-cycle cost estimates for the initial or future SLS launch vehicles. In May 2014, GAO recommended that NASA address this issue, and NASA partially concurred, citing that actions taken to structure the programs and track costs met the intent of the recommendations. However, GAO believes NASA's responses do not fully address the concerns about the program's cost estimates. There are opportunities, however, to improve long-term affordability through competition once the development path has been determined and NASA can finalize its acquisition approach. For example, the program plans to compete the procurement of one element; however, the agency has not finalized assessments of options for competitively procuring other future elements. Such assessments could better position NASA to sustain competition, control costs, and better inform Congress about the long-term affordability of the program. GAO's body of work on contracting has shown that competition in contracting is a key factor in controlling cost.
Why GAO Did This Study
SLS is NASA's first exploration-class heavy lift launch vehicle in over 40 years. Predecessor programs, such as Constellation, were canceled in the face of acquisition problems and funding shortfalls. NASA estimates it could spend almost $12 billion developing the first of three SLS vehicle variants and associated ground systems through initial launch in late 2017 and potentially billions more to develop increasingly capable vehicles. Ensuring that this program is affordable and sustainable for the long term is a key goal of the 2013 National Space Transportation Policy.
GAO was asked to evaluate SLS program challenges. This report examines (1) the SLS program's progress toward and risks for its first test flight in 2017 and (2) the extent to which the SLS program has plans in place to achieve its long-term goals and promote affordability. To do this, GAO reviewed relevant design, development, cost, and schedule documents; interviewed program officials; and evaluated SLS program actions using acquisition and cost estimating best practices.
Recommendations
Among other actions to reduce risk and allow for continued assessment of SLS progress and affordability, GAO recommends that NASA develop an executable business case for SLS that matches resources to requirements, and provide to the Congress an assessment of the SLS elements that could be competitively procured for future SLS variants before finalizing acquisition plans for those variants. NASA concurred with GAO's recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| National Aeronautics and Space Administration |
Priority Rec.
To provide the Congress with the necessary insight into program planning and affordability, and to decrease the risk of cost and schedule overruns, NASA's Administrator should direct the Human Exploration and Operations Mission Directorate to take the following action: To promote affordability, before finalizing acquisition plans for future capability variants, NASA should assess the full range of competition opportunities and provide to the Congress the agency's assessment of the extent to which development and production of future elements of the SLS could be competitively procured. |
NASA took some steps to assess opportunities for competition for future variants of the Space Launch System. However, NASA did not provide Congress with a comprehensive assessment of the extent to which development and production of future elements of the SLS could be competitively procured. There is no longer an opportunity within the current SLS program to take action on this recommendation.
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| National Aeronautics and Space Administration |
Priority Rec.
To provide the Congress with the necessary insight into program planning and affordability, and to decrease the risk of cost and schedule overruns, NASA's Administrator should direct the Human Exploration and Operations Mission Directorate to take the following action: To allow for a continued assessment of progress and affordability, NASA should structure each future increment of SLS capability with a total cost exceeding the $250 million threshold for designation as a major project as a separate development effort within the SLS program. In doing so, NASA should require each increment to complete both the technical and programmatic reviews required of other major development projects, per the agency's acquisition and system engineering policies. |
NASA agreed with this recommendation. In August 2021, NASA updated its space flight program and project management requirements to clarify that capability upgrades will be treated as projects, which will include holding technical and programmatic reviews like other major development projects. In August 2021, NASA incorporated a docking capability upgrade into the Orion cost and schedule baseline. In December 2023, NASA established new baseline for the Space Launch System (SLS) Block 1B capability upgrade. As of March 2024, officials told us that, in accordance with the August 2021 space flight program and project management requirements update, the agency is in the process of finalizing a cost and schedule baseline for the Mobile Launcher 2 and has plans to establish a cost and schedule baseline for the SLS Block 2 capability upgrade following a preliminary design review. We believe that these actions meet the intent of our recommendation. Establishing the separate cost and schedule baselines for these capability upgrades as separate development projects will provide decision makers transparency into costs and enable them to assess long-term affordability and progress.
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| National Aeronautics and Space Administration |
Priority Rec.
To provide the Congress with the necessary insight into program planning and affordability, and to decrease the risk of cost and schedule overruns, NASA's Administrator should direct the Human Exploration and Operations Mission Directorate to take the following action: Provide decision makers with an informed basis for making investment decisions regarding the SLS program, NASA should identify a range of possible missions for each future SLS variant that includes cost and schedule estimates and plans for how those possible missions would fit within NASA's funding profile. |
NASA agreed with this recommendation. NASA has taken steps to identify a range of missions for future SLS variants. For example, in May 2022, NASA provided a draft document which aligns the SLS variants by mission through Artemis IX. NASA also plans to demonstrate the SLS Block IB initial capability on the Artemis IV mission and the SLS Block 2 initial capability on the Artemis IX mission. NASA has established or plans to establish cost and schedule baselines for the SLS Block 1B and Block 2 development activities. After each new variant demonstrates its initial capability, NASA plans to include the operations and sustainment costs in the SLS program's 5-year operational cost estimate. However, in September 2023, we found that 5-year estimates of production and operations costs did not track costs by Artemis mission, nor by recurring SLS production items, so it was a poor measure of cost performance over time. To fully address this recommendation, NASA should identify the operations costs associated with the SLS Block 1B, beginning with Artemis V. For example, NASA could identify costs by mission or by production item. This information will ensure the decision makers have information to make decisions about the affordability of the program within the agency's funding profile.
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| National Aeronautics and Space Administration | To provide the Congress with the necessary insight into program planning and affordability, and to decrease the risk of cost and schedule overruns, NASA's Administrator should direct the Human Exploration and Operations Mission Directorate to take the following action: NASA should develop an executable business case for SLS based on matching requirements and resources that results in a level of risk commensurate with its policies. For example, NASA could delay the planned first flight test or increase funding to allow the program to establish cost and schedule baselines for demonstration of the initial capability at the 70 percent confidence level. |
NASA concurred with GAO's recommendation. The SLS cost and schedule baseline commitment released in September 2014 delayed the first planned test flight from December 2017 to November 2018 and increased program funding from $8.4 billion to $9.7 billion. These actions allowed the program to establish cost and schedule commitments at the 70 percent confidence level.
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