The Future of Commercial Space Travel Part 2: Orbiting Spacecraft and Duel between SpaceX and Boeing

On September 12 of this year, on the third day of the Polaris Dawn commercial space mission, which launched aboard SpaceX’s Dragon spacecraft, the first commercial spacewalk in human history was performed by two civilian astronauts: the American billionaire Jared Isaacman and Sarah Gillis, a SpaceX engineer. During the spacewalk, they used extravehicular activity (EVA) suits, which were also developed by SpaceX. The event brought the future of commercial space travel, with crews potentially consisting entirely of private civilian customers rather than professional astronauts, one step closer.

In light of the historic journey of the Polaris Dawn crew, we decided to explore how competitive the market for orbital space flights and space tourism might be in the future. Alongside SpaceX’s success, however, several other companies currently developing commercial spacecraft have faced numerous schedule delays and various technical problems. The question, then, becomes: will SpaceX ultimately monopolize this segment of the space business?

Three failures in a row: the decline of the Boeing Starliner 

The history of orbital spacecraft in this decade is inextricably linked with two companies: SpaceX and Boeing. In the early 2010s, each had its own concept of manned spaceflight. SpaceX proposed to carry out manned orbital missions with its Crew Dragon spacecraft, the design of which was first presented to the public in May 2014. Development of Boeing’s Starliner began 4 years earlier, and the company had also participated in NASA’s Commercial Crew Program, which aimed to create a reliable vehicle to deliver and return people from the International Space Station (ISS).

After proposing its vision for the CST-100 (Crew Space Transportation), also known as the Starliner, Boeing received $18 million from NASA as initial funding for the project. Along with this, a further $6.7 million was given to the American rocket company United Launch Alliance, whose Atlas V rocket was chosen for the Starliner. Boeing management was upbeat about the project, and as early as 2015 was making optimistic predictions about when the Starliner would be ready for missions. 

The design of the spacecraft featured a fully modular assembly, without welding any of its key segments. It was predicted that the CST-100 Starliner would be capable of performing up to ten space missions, each lasting up to six months.

Over the next three years, NASA provided additional funding for the project amounting to over $500 million. Boeing was even given access to the Orbiter Processing Facility at the Kennedy Space Center, where NASA’s legendary space shuttles were assembled. Despite this support, however, Boeing continued to delay the release of the Starliner.

In September 2014, NASA also signed a $4.2 billion contract with Boeing to supply spacecraft capable of delivering people to low Earth orbit (LEO) under the Commercial Crew Transportation Capability (CCtCap) program. Although the spacecraft was specifically meant for government missions, the agreement between NASA and Boeing allowed the latter to sell available seats on the Starliner to private individuals. This meant that the success of Boeing’s Starliner could potentially attract commercial clients, allowing the company to expand into the orbital tourism market.

Interestingly, as part of the CCtCap program, NASA also signed a contract with SpaceX to produce the Crew Dragon. However, the sum allotted to SpaceX was significantly smaller than that provided to Boeing, only $2.6 billion. This was a reflection of the fact that, in 2014, Boeing was considered the stronger developer, and indeed the company’s leadership lobbied extensively to receive the entire NASA CCtCap budget to implement the Starliner project. NASA’s chief researcher at the time, William H. Gerstenmaier, considered the CST-100 project more viable than the Crew Dragon and believed it would easily outpace SpaceX, which, although ambitious, was still very young and inexperienced in the aerospace industry.

However, Boeing’s hopes for conducting the first crewed Starliner flight by 2017 were far from reality. In fact, the spacecraft’s first uncrewed launch only took place at the end of 2019, when, on December 20, an Atlas V rocket delivered the Starliner into orbit, where it spent nearly two days.

The CST-100 demonstration revealed several software errors that nearly resulted in the total loss of the spacecraft. The first occurred immediately after the Starliner separated from its launch vehicle. Instead of briefly firing its engines to enter the correct orbit, the main computer initiated a long burn, nearly depleting its fuel and making it impossible for the module to dock with the ISS.

Upon returning to Earth, the Starliner encountered another software error, which nearly caused the empty crew capsule to collide with the Starliner’s service module during separation. Nevertheless, the CST-100 miraculously returned to Earth and was sent for post-flight testing, with Boeing acknowledging that the spacecraft’s first launch was only partially successful. Following an investigation into the mission’s various failures, the company was given several dozen recommendations to implement before the Starliner’s next flight. The FAA also accused NASA of insufficient oversight during the CST-100’s production process and of not requiring Boeing to conduct a full cycle of end-to-end tests during ground trials.

As Boeing began addressing its mistakes, valuable time in the race against its main competitor was being lost. On November 16, 2020, SpaceX’s Crew Dragon completed its first operational crewed mission during Crew-1, successfully delivering a crew of four to the ISS.

This was a painful blow to the Starliner project, whose next uncrewed flight only took place on May 19, 2022 – a delay of nearly two years after it was originally scheduled. But even after years of delays, the CST-100’s Orbital Flight Test 2 (OFT-2) mission was not a success, with several engines designed for orbital maneuvers failing. Despite three years of painstaking efforts to correct problems after the OFT-1 mission, the Starliner was still riddled with problems. On May 22, 2022, the CST-100 did manage to dock with the ISS using a backup orbital engine system, but the outcome of the second CST-100 demonstration left much to be desired.

The Starliner’s third attempt at redemption came in 2024, when the exact launch date of the spacecraft’s third mission, and its first crewed flight, was finally announced. It launched on June 5, 2024, with astronauts Barry Wilmore and Sunita Williams aboard… after several failed attempts due to a malfunction in the ground navigation computer.

The Starliner’s bad luck, unfortunately, returned once again. On its third flight, the spacecraft likely experienced a helium leak, which resulted in a loss of power in five thrusters that were used during orbital rendezvous and docking maneuvers with the ISS. Manual control by NASA’s experienced crew during the approach and docking with the space station was successful, and the Starliner managed to dock with the ISS. However, a return journey aboard the malfunctioning spacecraft was out of the question.

Since the Starliner’s third consecutive troubled launch, Boeing’s engineering team has conducted a series of ground tests to determine what exactly caused the maneuvering engines to lose power. The most likely cause was the deformation of a Teflon seal and a helium leak. However, this explanation was not confirmed during similar tests in orbit. In any case, to bring the stranded Starliner crew home NASA had no choice but to free up two seats on the next Crew 9 crewed mission at the end of September. The Crew Dragon was now responsible for returning the crew of the disabled Starliner. 

This was the final humiliation for Boeing in its duel with SpaceX to provide the best spacecraft for delivering crews to low Earth orbit. In the decade since NASA first awarded contracts to the companies, SpaceX has proven itself able to build a reliable spacecraft, achieving this at more than twice the cost savings compared to Boeing and without falling critically behind schedule. Meanwhile, the deserted Starliner capsule returned to Earth in early September, after which engineers began a thorough investigation to determine what technical issues had once again led to the failure of the CST-100 mission.

In the seven years since Boeing first announced the start of crewed missions in 2017, the total budget for the Starliner project has increased by $1.6 billion, reaching an astonishing $5.8 billion in total. Boeing still hopes that the CST-100 will soon be mission-ready, thanks to new engines developed by Aerojet Rocketdyne, and a version of the Starliner with this engine is planned to be launched during its next mission.

Boeing CEO Robert Kelly Ortberg has already stated that, despite three failures in a row, the company will strive to do better in the future. But time is running out: Boeing’s chief competitor is racing ahead at escape velocity, threatening to monopolize the field of both government and commercial crewed flights for at least a decade.

Crew Dragon: the last man standing? 

While the Starliner was struggling to successfully complete even a single mission, SpaceX’s Crew Dragon conducted 15 orbital flights, 13 of which were destined for the ISS (the other two were simple trips to LEO). During this time, Crew Dragon managed to deliver 61 people to orbit, of whom 15 were commercial clients. This is quite an impressive record for less than four years of missions, especially considering that Boeing had been the favorite during the competition for CCtCap funds.

Furthermore, it is worth noting that SpaceX manufactures the Crew Dragon in two main variants: one is primarily intended for transporting people, while the other is a cargo variant meant for organizing logistics missions and delivering supplies to the ISS. This has guaranteed SpaceX additional orders for future supply missions, which has strengthened its position for winning contracts to service orbital stations. Given that, over the next decade several commercial orbital stations are expected to be deployed, SpaceX, with its growing experience in space logistics, will be in a commanding position to win contracts.

The Crew Dragon has become a pioneer in many respects: It delivered the first fully commercial crew to orbit on the Inspiration 4 mission; Axiom Mission 1, the first commercial mission to the ISS, went there on the Crew Dragon; and, during the recent Polaris Dawn mission, commercial clients made their first spacewalk from Crew Dragon. All of these achievements have earned Crew Dragon a very strong reputation.

SpaceX, of course, has also faced its own failures in crewed missions. For instance, during the uncrewed Demo-1 orbital launch on April 20, 2019, the Crew Dragon exploded due to a nitrogen tetroxide leak in the helium line used for pressurizing the fuel tanks. This was the first and, thus far, the only loss of a Crew Dragon spacecraft. After the accident, SpaceX quickly resolved the technical issues that had led to the disaster. Just over a year after the explosion, another Crew Dragon variant successfully delivered its crew to the ISS.

Subsequently, all crewed flights to the space station using Crew Dragon were completed successfully. The crewed launch schedule for Crew Dragon was even expanded in order to compensate for the gap left by Boeing’s Starliner, which had been intended to handle scientific missions to the ISS.

Much of SpaceX’s success lies in the company’s specific characteristics: SpaceX is a full-cycle company that launches its own Dragon spacecraft using its own Falcon 9 rockets. It built its own spaceport – the launch pad that recently appeared near Boca Chica, Texas –  and the recent Polaris Dawn mission demonstrated that the company is even prepared to equip its crews with its own spacesuits. This level of autonomy in private crewed space launches arguably makes Elon Musk’s company the only one capable of conducting private orbital journeys on demand, without fear of delays or cancellations due to problems with third-party contractors.

Organizers of expensive commercial space flights, such as Axiom Space and Space Adventures, understand that, in the segment of space tourism, billion-dollar investments in developing a fleet of rocket and space technology is infeasible. As a result, they depend on affordable and proven solutions offered by giants in the aerospace market. Given its success in this domain, SpaceX only continues to strengthen its position, while its main rivals fall further behind.

Indeed, as long as competitors like Boeing continue to face interminable setbacks, Musk’s company is likely to remain in high demand among both private and government clients. SpaceX’s business plans indicate that the company even aims to expand its role in the field of space tourism, including lunar tourism, which will encompass journeys around the Moon. To realize these ambitions, the company plans to utilize its Starship spacecraft and its Superheavy booster.

SpaceX, however, is not the only company working on sending tourists to the moon. Space Adventures, which organized the world’s first tourist trip to the ISS in 2001, has been focused for the last 20 years on implementing its Deep Space Expedition Alpha (DSE-Alpha) program, which hoped to launch commercial flights around the Moon at the end of the last decade. 

However, dependence on external resources has hampered these ambitions. Lacking its own fleet of rockets and spacecraft, it hoped to rely on Russian Soyuz spacecraft for its proposed lunar trips. For various reasons, however, this has become increasingly unlikely over the years, and it is not likely that DSE-Alpha will ever amount to anything. 

The only alternative to Crew Dragon, then, is the partially reusable Orion spacecraft, which was specifically developed for NASA’s Artemis lunar missions. Since 2009, it has completed six successful demonstrations, including one as part of the Artemis program. However, Orion is purely a government project that is not meant for commercial missions. Like the Apollo program, its operation is expected to be limited to a new cycle of lunar missions, after which Orion may likely become just a museum piece.

Entertainment for the rich? 

Will the Crew Dragon’s success lead to an expansion of the space tourism segment? As of now, several factors are hindering this, the main one being the strict focus on ultra-high net worth clients: billionaires and others with assets exceeding $30 million (UHNWI). The latter group includes approximately 426,330 individuals (according to Wealth-X estimates for 2024) with a combined net worth of $49.2 trillion. As of 2022, the total number of billionaires was estimated at 2,781, with a combined wealth of $14.2 trillion. In any case, not all of these people are interested in paying to travel to space. 

What this suggests is that, paradoxically, until space travel becomes commonplace, the potential client base for companies involved in space tourism will remain quite small. The gradual reduction in the cost of space travel, possible only with the development of new, more powerful, and fuel-efficient rockets using methalox fuel, might drive costs down and expand the circle of potential clients in the space tourism sector, but such developments are still unlikely to make space tourism accessible to the general public.

Despite the relatively small percentage of potential clients and companies currently offering private space travel, the overall capitalization of the space tourism sector is forecasted to grow. The latest report from Research and Markets, dedicated to space tourism research, states that, by 2030, the capitalization of this segment could reach $12.85 billion (if the compound annual growth rate (CAGR) remains at 40%). As of today, market capitalization stands at $1.67 billion, having added nearly half a billion dollars in the past year.

It is also important to understand that, while suborbital manned journeys are still limited exclusively to the space tourism sector, the overall scope of orbital flights is much broader, and includes the possibility of conducting commercial flights for both thrilling experiences and scientific missions to orbital stations, the number of which is expected to increase in Earth’s orbit over the next decade.

Apart from American commercial manned flight programs, other countries, which are only beginning their journey as space powers, are increasingly making their presence known. In December of this year, the Indian Space Research Organization (ISRO) is preparing to demonstrate its manned spacecraft, Gaganyaan, this time in an unmanned mode. The crew module is currently in the assembly stage at the Vikram Sarabhai Space Center. Assembly is expected to be completed within a month, after which the spacecraft will be mounted on India’s LVM-3 launch vehicle, with a launch planned for December this year.

Gaganyaan should be able to carry three crew members and will also be capable of performing orbital rendezvous and docking maneuvers with a space station. Although the spacecraft is currently envisioned solely to serve the needs of ISRO’s manned flight program, the potential success of the Gaganyaan mission may open doors for private customers.

The situation in the field of manned space flights once again clearly demonstrates how new approaches from private initiatives can surpass the veterans of this market. Boeing, a giant with over a century of history and involved in many successful space projects (in 1993 it was responsible for building the American segment of the ISS), was ultimately not able to rely on its prestige alone in its competition with the relatively young SpaceX.

A more flexible approach to production, a focus on “live” tests of new types of aerospace technology (many pre-flight tests for Starliner, by contrast, were limited to computer simulations), and the ability to consolidate efforts on achieving results ensured SpaceX’s success in this rivalry.

Another key factor contributing to this success was the fundamentally different management styles of the two companies. While many key positions at SpaceX are held by true technical engineers, Boeing’s top management, after decades in the aviation business, primarily consists of financiers and accountants. Commenting on Starliner’s third consecutive failure, Elon Musk noted: “Boeing has too many non-technical managers.” It’s hard to disagree: while SpaceX was calculating all the technical nuances of its spacecraft, Boeing seemed more focused on counting money.