CEO Peter Beck is at the heart of the fairing or nose cone of the Neutron rocket that the company is developing.
Rocket Lab went public over the next few months through a SPAC merger, and CEO Peter Beck spoke to CNBC to shatter the space company’s capabilities thanks to the pile of money in the deal.
The company merged with Vector Acquisition in a deal that gives Rocket Lab $ 4.1 billion worth of business, and the move is expected to close in the second quarter.
Rocket Lab is the market leader for small launches, with its Electron rocket carrying nearly 100 small satellites into orbit over the past few years. The company has also built a spacecraft business to provide customers with a flexible platform that pairs with its rockets.
But now, with about $ 750 million in cash expected to go public, Rocket Lab will build a larger rocket called the Neutron. The launch market is divided into three sections – small, medium and heavy lift – and Neutron will focus on this middle section.
In addition, Rocket Lab will build a Neutron within the requirements required to launch a spacecraft that transports humans to be able to launch astronauts to the International Space Station.
Beck expects Rocket Lab to spend about $ 200 million to develop Neutron, adding that the rest of the company’s capital will be used to expand the company’s existing business lines and make acquisitions.
“We have strong applications for all that money,” Beck said.
What Neutron adds to Rocket Lab
Beck noted Electron’s history of successful launches and the company’s multi-customer relationship as a catalyst for its decision to build Neutron – although in previous years he said Electron was the largest rocket his company would develop.
“Now we understand where everyone is going and we understand everyone’s business plan,” Beck said.
Rocket Lab expects that “most of all satellites launched” in the next few years will be for constellations – the name of the space industry for satellite networks working together from tens to thousands of spacecraft.
The neutron is designed to be more than twice as tall as the Electron and can carry up to 8,000 kilograms to low Earth orbit. That would put him in the same capability class as Russia’s Soyuz missile, which Beck noted was “the most prolific missile in history.”
“If you go and build a vehicle of this class, you will be rejected so that you are not sure that it is capable of human space flight,” Beck said.
SpaceX’s Crew Dragon Endeavor was seen attached to the International Space Station on July 1, 2020.
Rocket Lab expects Neutron to launch for the first time by 2024, with Beck noting that the company will do additional work to “ensure it is certified for human space flight.”
Currently, the only US company that regularly flies astronauts is SpaceX, with NASA certifying its Falcon 9 rocket for space flight late last year. These certification requirements include structural elements ranging from fuel tanks to redundancy strategies, Beck noted.
Given that it would be similar in capabilities to Russia’s Soyuz, Beck said the Neutron would be able to lift a three-man spacecraft – although that would depend on the design of the spacecraft itself.
Neutron’s booster – the bottom and most expensive part of the rocket – will also be reusable, similar to the way SpaceX lands its Falcon 9 rocket accelerators. that informs the company’s projects about Neutron.
Build a factory near the launch site in Virginia
The Electron rocket is on the company’s launch site at NASA’s Wallops facility in Virginia.
Neutron will launch from the pad the company built at NASA’s Wallops flight facility in Virginia.
While the company’s rocket and spacecraft production takes place at its headquarters in Long Beach, California, Rocket Lab will look elsewhere to build a new neutron plant.
“One of the things I’ve sold a lot to is building near the launch pad,” Beck said. “The opportunity to build close to the launch pad I think will be a real key element for this vehicle.”
The Neutron factory will bring hundreds of jobs with it. Although he did not specify which cities or regions are under consideration, Beck noted that Rocket Lab is currently “conducting a competition process to find out exactly where.”
Rocket Lab expects many Electron components to be transferred directly to Neutron, with Beck advertising a shared product line for components such as avionics or electronics.
The ultimate goal for Neutron is an “excellent workhorse” that can be used repeatedly, Beck said.
This means developing a new vehicle structure, as he emphasized that the carbon composites that make up the Electron missiles are a challenge, given the heat withstood during the re-entry process. Rocket Lab analyzes harder materials, Beck said, so Neutron amplifiers can be used frequently.
Neutron engines are another hurdle that Beck has acknowledged has been developing for the longest time building a rocket.
Rocket Lab will not use a variation of the 3D-printed Rutherford engines that power Electron rockets, as Beck said “there is no reinforcement of Rutherford that will approach remotely” from the Neutron power supply.
“But it’s not like we haven’t built engines before,” Beck said, adding that the company has “in-depth knowledge of manufacturing engine additives that will be included in the new engine program.”
Building a scalable production line is the most “painful” part of building an orbital rocket, Beck said, an idea that SpaceX founder Elon Musk emphasized in a similar way with his Starship rockets.
“Elon and I just unanimously agree that the hardest part of going into orbit for the first time is actually scaling production to do it over and over again,” Beck said.
Rocket Lab’s experience in building Electron and then scaling production to near-monthly speeds are lessons learned that Beck said would inform how the company is building Neutron and its production.
Beck’s view of public release and the SPAC space boom
An Electron rocket is being prepared for launch.
Rocket Lab is one of six space companies that have announced deals with special purpose acquisition companies in the past few months, a trend in the growing industry as companies seek capital. Beck noted that Rocket Lab is “on a very methodical path to a traditional IPO” before considering merging with SPAC.
“What has allowed us to do is speed up not only the road, but also the ability to carry out the projects we want,” Beck said.
He also stressed that Rocket Lab is building a vertical space platform – developing everything internally – from engines to spacecraft components.
This belief is reflected in Rocket Lab’s financial forecast, with space systems expected to generate nearly as much as the company’s $ 1.6 billion startup by 2027.
“The basic belief is that if you have a launch vehicle and satellites and satellite components and you are vertically integrated, your ability to do really significant things in the space applications market is incomparable,” Beck said.
Beck said faith is “played in real time” with SpaceX Starlink’s satellite Internet project. He believes that other satellite broadband companies are “difficult to compete with the launch of Starlink”, as SpaceX has both its own production and its own rockets.
“One of the things we did [at Rocket Lab] over the last decade, it has been a really methodical approach to building all the infrastructure we need within the company to accomplish some really big things in the application market, ”Beck said.
As for his company’s differentiator from other space SPACs, Beck said the Rocket Lab is for “proven performance.”
“We’re very good at what we say we can be,” Beck said. “There are a lot of promises and aspirations in this industry. What I’ve always been very careful about is that we don’t talk about anything until we do it or we have a very high level of confidence.”
Transparency about financial performance to aspirations is “the wonderful thing about the public market,” Beck added. For investors looking to buy in the space sector, Beck said, “let’s look at our experience and make our own decision.”
“We are really excited to introduce a high-quality space asset to the market,” Beck added. “What you get with Rocket Lab is a proven company and a reasonable management team that is proven to deliver and will continue to do so.”
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