SpaceX's vision involves three phases: 1) Figuring out how to put things in space, 2) Reducing the cost of space travel through ongoing delivery services, 3) Bringing the cost of sending a person to Mars under $500,000. SpaceX aims to safely and reliably deliver payloads to orbit at much lower prices than competitors through transparent pricing, milestone-based development, and carrying risk themselves. They have innovated through reusable rockets using a single engine type, and mass production through vertical integration and newer manufacturing technologies like 3D printing. Key milestones include NASA contracts, crewed flights to ISS, and successful rocket landings.

2. SpaceX Vision:
Colonise Mars
Phase I:
Figuring out how to put things in Space
Phase II:
Reduce the cost of space
travel; Ongoing space
delivering business
Phase III:
Bring down cost of sending a
person to Mars under $500,000

3. Source: Seeking Alpha
Commercialisation Potential of Space:

4. SpaceX Model
The business model is to safely and reliably deliver payloads to Earth orbit at a
much lower price than competitors
• Transparent fixed pricing; competitors lobby for opaque cost-plus contracts
• Development is milestone based. Don’t ask to be payed up front; carry a large portion of the risk themselves
The operating model:
Product Innovation:
• Designed LV to use a single type of rocket engine
clustered together
• Higher production volume; increased safety
• Reusable Rockets; bring down payload cost/kg by a
factor of 100
Process Innovation:
• Vertically integrated factories to mass produce
rockets
• Newer tech: 3D Printing, Friction Stir Wielding
• Simplified processes, reduced part counts, low costs,
fewer failures
Source: Harvard Business Review

6. Milestones…
• In 2011, NASA retires the Space Shuttle programme
• SpaceX holds $4.2bn contracts to deliver payloads in space
and ISS servicing
• Bagged the contract to send astronauts to ISS; presently
NASA pays $70mn per astronaut for Russia’s Soyuz Capsule
• Google invested $1bn in SpaceX; teaming up to beam
internet globally
• Successful landing of Falcon 9 on land(2015) and on
sea(2016)
• In 2016, Dragon Space Pod successfully attaches ISS; to
evolve in Manned Space Taxi
Source: Bloomberg

7. Low Cost Space Delivery Market:
Falcon 9 PSLV
Cost to build $62mn $16mn
LEO Payload Capacity 13150 kg 3250 kg
GTO Payload Capacity 4850 kg 1450 kg
Payload Price/kg $4700 $4900
LEO: Low Earth Orbit; GTO: Geostationary Transfer Orbit
• ISRO aiming to develop Reusable Launch Vehicle with payload capacity ~10,000kg
by 2030; to bring down payload cost/kg to $500
• In terms of launch manifests: SpaceX > ISRO
• SpaceX is fully vertically integrated thus reducing costs; ISRO outsources
manufacturing to L&T, Godrej & Boyce and MTAR Technologies etc.