NASA’s Artemis Launch Gives Boeing Chance to Restore Its Space Credibility
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NASA’s Artemis Launch Gives Boeing Chance to Restore Its Space Credibility

By By Andrew Tangel and Micah Maidenberg
Mon, Aug 29, 2022 9:30amGrey Clock 4 min
Aerospace company has long worked on NASA missions, but latest rocket has faced cost overruns and delays in recent years

The National Aeronautics and Space Administration’s scheduled test launch Monday of a new mega-rocket will give Boeing Co. another chance to prove it can pull off big national projects following past missteps.

Boeing is the biggest contractor for the agency’s Space Launch System, a 38-storey-tall rocket that is supposed to launch the Orion spacecraft without crew toward the moon—and in 2025 blast U.S. astronauts back there as part of NASA’s Artemis missions to explore space.

“We’re providing both the brains and muscle,” Boeing says on its website, “to make the next generation of human spaceflight possible.”

 

Boeing has a long history developing NASA vehicles and handling missions for the agency. The company helped deliver astronauts to the moon in the 1960s, and worked on Space Shuttle operations before that program ended more than a decade ago. It also provides support for the International Space Station for NASA.

Boeing’s space business has struggled more recently, including technical and management problems with the SLS. Stumbles with its separate Starliner spacecraft repeatedly delayed a flight for NASA, and that ship has lagged behind a competing vehicle from Elon Musk’s SpaceX.

A successful SLS launch would help Boeing restore its reputation as it competes for government contracts and engineering talent with startups.

“The SLS is just another opportunity for us to show how well Boeing can do space,” said John Shannon, a Boeing vice president who oversees the SLS program for the company. “This vehicle can do something that no other vehicle can do, and we haven’t had a rocket like this in 50 years.”

Mr. Shannon added the company is confident that two of the big parts of the mission that Boeing engineers worked on—the main stage of the rocket used during liftoff, and a propulsion system designed to give Orion a big push in space toward lunar orbit—will function as planned.

The test launch of SLS and Orion without crew was supposed to happen four years ago, but Boeing and other contractors faced technical slip-ups and challenges the NASA inspector general has cited as among the sources of delays and cost overruns.

The belated test launch comes after problems Boeing has faced elsewhere in its commercial, military and space segments.

Three years ago, Boeing botched a test launch of its Starliner space capsule, sending it into the wrong orbit and failing to dock with the International Space Station. Subsequent technical problems delayed a do-over until a successful Starliner test launch earlier this year. The company has booked $767 million in charges related to that program over the past three years.

“We need Boeing to get this right,” said Scott Pace, a former NASA official who is director of the Space Policy Institute at George Washington University. “There’s a long history in recent years of Boeing’s technical problems, which they’re trying to fix—I sure hope they do, because it’s a national asset and it needs to work.”

Any major problems with this initial Space Launch System test launch could set back NASA’s planned Artemis missions to the moon. Two years from now, astronauts are scheduled to be on Orion as another SLS rocket launches it into space. And as soon as 2025, NASA wants SLS to propel astronauts to lunar orbit, where they would get on a SpaceX lander to travel to the lunar surface.

The missions could lay the groundwork for a possible future lunar base and an eventual operation to Mars, according to plans NASA has laid out under Artemis.

The overall project also involves aerospace companies including Northrop Grumman Corp. and Lockheed Martin Corp. Those contractors also have at times faced technical issues and delays flagged by the space agency’s inspector general. Lockheed Martin years ago dealt with challenges related to flight software and valves used for Orion, while Northrop Grumman, responsible for booster rockets on SLS, did so with insulation and avionics, according to reports from NASA’s inspector general.

Building and testing a new generation of exploration spacecraft that meet NASA’s stringent requirements has been challenging, with supply chains posing difficulties in recent years, said Mike Hawes, a vice president and program manager for Orion at Lockheed. Wendy Williams, vice president for propulsion systems at Northrop Grumman, said the company has incorporated lessons from building boosters for the first Artemis flight into the second, reducing timelines and costs.

The SLS program took shape amid political wrangling between the Obama White House and Congress in 2010. The project adapted technology from NASA’s now-ended Space Shuttle program to develop the world’s most powerful rocket capable of propelling humans and big spacecraft far into space. Some critics dubbed it the “rocket to nowhere” or the “Senate Launch System.”

Congress initially sought to launch SLS in 2016, but NASA early on saw the first mission happening in 2018. NASA Inspector General Paul Martin has estimated each of the first four Artemis missions will cost $4.1 billion, a figure he said is unsustainable.

Mr. Martin’s office had flagged Boeing miscalculations related to the scope of the project, welding problems and other troubles. “There was poor planning and poor execution,” he said in congressional testimony earlier this year.

Mr. Shannon, the Boeing manager for SLS, has said the company faced difficulties with the infrastructure at a Louisiana facility where NASA wanted the company to build the rocket. He said the company underestimated how long it would take to get its suppliers to provide needed parts.

“The aerospace supply chain for human spaceflight had really atrophied,” he said, citing the end of NASA’s Space Shuttle program years earlier for that. “We had to go in and really reinvigorate that supply chain.”

As of a year ago, Boeing and one of its joint ventures were awarded contracts worth about $12 billion over more than a dozen years for SLS work, according to a NASA inspector general report from November. Those deals represented 59% of the total contract value for the rocket program. Unlike with other government contracts, Boeing hasn’t booked any charges for SLS because many of its agreements with NASA are so-called cost-plus contracts, meaning taxpayers foot the bill for cost increases.

Mr. Shannon said the SLS program is profitable for Boeing but added: “We feel like we have a responsibility to provide good value to the taxpayer.”

As part of an attempt to reduce future SLS costs, NASA is planning to restructure the program’s finances. While the space agency offered few details, a NASA spokeswoman said the plan involved “creating a more affordable and sustainable exploration framework” in the future by “shifting more responsibility to industry.”

Boeing Chief Executive David Calhoun said recently he didn’t want to expose the company to significant financial risk with SLS. He told the trade publication Aviation Week: “I want to prove it all out to be ready, but I’m not going to do silly things, like lose money for 10 years.”



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The Knight Frank Luxury Investment Index reveals investments of passion are paying strong dividends, in some areas at least

By Bronwyn Allen
Tue, Apr 9, 2024 4 min

Art was the investment of passion that gained the most in value in 2023, according to Knight Frank’s Luxury Investment Index (KFLII). This is the second consecutive year that art has risen the most among the 10 popular investments tracked by the index, up 11 percent in 2023 and 29 percent in 2022. Art was followed by 8 percent growth in jewellery, 5 percent growth in watches, 4 percent growth in coins and 2 percent growth in coloured diamonds last year.

The weakest performers were rare whisky bottles, which lost nine percent of their value, classic cars down six percent and designer handbags down four percent. Luxury collectables are typically held by ultra-high-net-worth individuals (UHNWIs) who have a net worth of US$30 million or more. Knight Frank research shows 20 percent of UHNWI investment asset portfolios are allocated to collectables.

In 2023, the KFLII fell for only the second time, with prices down 1 percent on average.

Despite record-breaking individual sales in 2023, a surge in financial market returns contributed to a shift in allocations impacting on luxury asset value,” the report said. “… our assessment reveals a need for an ever more discerning approach from investors, with significant volatility by sub-market.

Sebastian Duthy of AMR said the 2023 art auction year began with notable sales including a record price for a Bronzino piece. But confidence waned as the year went on.

“It was telling that in May, Sotheby’s inserted one of its top Old Master lots – a Rubens’ portrait – into a 20th Century Modern evening sale. But by then, it was clear that the confidence among sellers, set by the previous year’s record-busting figures, was ebbing away. In the same month, modern and contemporary works from the collection of the late financier Gerald Fineberg sold well below pre-auction estimates.”

The value of ultra contemporary or red-chip’ art contracted the most in 2023.

“Works by a growing group of artists born after 1980 have been heavily promoted by mega galleries and auction houses in recent years. With freshly painted works in excess of £100,000 almost doubling in 2022, it was little surprise that this sector was one of the biggest casualties last year. There is a risk there are now simply too many fresh paint artists with none really standing out.”

In the jewellery market, Mr Duthy noted that demand was strongest for coloured gemstones of exceptional quality, iconic signed period jewels, single-owner collections, and items with historic provenance in 2023. In the watches market, Mr Duthy said collectors chased the most iconic and rare timepieces.

A Rolex John Player Special broke the model record when it sold for £2 million at Sotheby’s in May, double the price for a similar example sold at Phillips in 2021,” he said.

Although whisky was the worst-performing collectable in 2023, it has delivered the highest return on investment among the 10 items tracked by the index over the past decade, up 280 percent. Andy Simpson of Simpson Reserved, said 2023 was a challenging year but the best of the best bottles gained 20 percent in value. In my opinion some bottles that lost significant value in 2023 will return through the next two years as they are simply so scarce and, right now at least, so undervalued, Mr Simpson said.

Whisky was the worst performing collectable in 2023 but it had highest return on investment over a 10-year period. Image: Shutterstock

Classic car expert Dietrich Hatlapa said the 6 percent fall in collectable vehicle values in 2023 followed a 22 percent surge in 2022. The strong performance of other investment classes such as equities may have dampened collectors’ appetites it’s a very small market so it only takes a minor change in portfolio allocations to have an effect, and there has also probably been a degree of profit taking. However, we have seen some marques like BMW (up 9 percent in value) and Lamborghini (up 18 percent), which appeal to a younger breed of collector, buck the trend in 2023.”

Mr Duthy said a dip in the share price of the top luxury handbag brands last Autumn appeared to spook investors. Last autumn it was possible to pick up an Hermès white Niloticus Himalaya Birkin in good condition for under £50,000. The recent slide reflects a general correction at the upper end that’s been underway for some time rather than changing attitudes to the harvesting of exotic skins.

According to Knight Frank’s Attitudes Survey, the top five investments of passion among Australian UHNWIs are classic cars, art and wine. Fine wine values gained just 1 percent in 2023 as the market continued its correction, said Nick Martin of Wine Owners. “It’s been a hell of a long run, so I’m not that surprised. Some wines from very small producers that had enjoyed the most exuberant growth have seen the biggest drops. It had got a bit silly, £50 bottles had shot up to £200 or £300.”

Favourite investments of passion: Australia vs Global

1. Classic cars (61 percent of Australian UHNWIs vs 38 percent of global UHNWIs)
2. Art (58 percent vs 48 percent)
3. Wine (48 percent vs 35 percent)
4. Watches (42 percent vs 42 percent)
5. Jewellery (18 percent vs 28 percent)

Best returns among investments of passion (10 years)

1. Whisky 280 percent
2. Wine 146 percent
3. Watches 138 percent
4. Art 105 percent
5. Cars 82 percent

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