Insider Brief
- United Launch Alliance (ULA) is experiencing a remarkable turnaround, the Washington Times reports.
- A decade ago, the company was on the ropes after being confronted by rising competition and suffering a series of political hurdles.
- The Post credits CEO Tory Bruno for leading the company turn-around.
- Image: A United Launch Alliance Atlas V rocket lifts off from Space Launch Complex 41 at Cape Canaveral Space Force Station in 2022 carrying NOAA’s GOES-T satellite. (Credit: United Launch Alliance, Flickr)
United Launch Alliance (ULA) is experiencing a remarkable turnaround, nearly a decade after facing existential threats from rising competition and political hurdles.
Tory Bruno, who took over as CEO in 2014, has led a radical transformation of the company, saving it from potential collapse, The Washington Post reports.
By 2014, ULA’s dominance in the rocket industry was under severe threat. Elon Musk’s SpaceX was disrupting the market and cutting into ULA’s lucrative government contracts. On the political front, Congress was considering a ban on the Russian-made engines that powered ULA’s rockets, further jeopardizing its future. ULA’s parent companies, Lockheed Martin and Boeing, were growing desperate, even contemplating pulling the plug on the joint venture.
Bruno accepted the CEO position knowing the scale of the challenge.
“It was clear they were in serious trouble,” he told The Washington Post. “This is a company that wasn’t supposed to survive.”
Bruno initiated sweeping changes, laying off hundreds of workers, including 40 percent of executives, streamlining processes, and shedding surplus real estate.
Despite SpaceX capturing a significant portion of the market, ULA managed to retain enough business to sustain operations, the Post reports.
Based near Denver, the company secured new launch contracts with the Pentagon and intelligence agencies. ULA also convinced Congress to permit the continued import of Russian-made engines. After years of delays, the company is now on the verge of launching a next-generation rocket with an American-made engine from Jeff Bezos’s Blue Origin, according to the newspaper.
In a major win, ULA recently signed a contract for 38 launches to help install Amazon’s Kuiper internet satellite constellation, marking the largest commercial launch deal ever. This new line of commercial business could sustain ULA for years, providing a solid footing for its future.
However, challenges remain. ULA’s new Vulcan rocket has yet to fly, partly due to delays in engine delivery from Blue Origin. SpaceX is also developing a fully reusable rocket, Starship, which could once again disrupt the industry.
“ULA still faces, and will continue to face, significant challenges,” Matthew Weinzierl and Brendan Rosseau of Harvard Business School wrote to The Washington Post. The experts noted the complexities of certifying a new launch vehicle and the competition from more agile and integrated companies.
ULA was formed in 2006 when the Pentagon allowed Lockheed and Boeing to create a joint venture, giving it a monopoly on military launch contracts. The Pentagon prioritized “assured access to space” over cost, favoring reliable rockets. SpaceX initially tried to block ULA’s formation, arguing it stifled competition, but failed. However, by 2014, SpaceX had proven itself with successful Falcon 9 launches and NASA contracts, prompting a renewed legal challenge for Pentagon business.
Musk criticized ULA’s reliance on Russian engines and gained support from Senator John McCain, who argued against using Russian technology for national security launches. SpaceX’s subsequent lawsuit was successful, allowing it to compete for Pentagon contracts.
Bruno replaced ULA’s former CEO Michael Gass, understanding the need for drastic changes, according to the Post. ULA had grown complacent with its monopoly, extracting high prices from the Pentagon. Now, facing fierce competition from SpaceX, Bruno revitalized the company.
But that fierce competition will only become more fierce, Weinzierl and Rosseau told the Post. Bruno has been able to compete against SpaceX, they said, but, it now “will need to find its place in a dynamic and increasingly crowded field.”
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