Rocketdyne Being Sold – Griffin as New CEO? (Update)
Keith’s 11 June note: Industry sources report that Chase Bank has led a group that has bought (or is seekng ot buy) venerable rocket engine manufacturer Rocketdyne from Pratt & Whitney and that Mike Griffin will be the new CEO. Stay tuned for more details.
Keith’s 12 June update: Industry sources now speak of Rocketdyne as having been bought by Goodrich while others claim it has been bought EADS. Others now say that that Mike Griffin has not been asked to be the CEO. The speculation and claims about Rocketdyne’s suitors clearly indicates the value that many in the industry see in its products.
United Tech lowers equity sale to fund Goodrich deal, Reuters
“One source familiar with the matter said the Rocketdyne sale to a private investor is imminent and should be completed by the end of the month. The two sides had hoped to finish negotiations by June 15, but that now appears unlikely. “With any sale, you want to do them as fast as you can because otherwise the company loses momentum,” the source said. The source, who was not authorized to speak on the record, did not name the private equity investor and had no details on the selling price for Rocketdyne and the other units. The units were fetching prices “pretty much in line” with what UTC had expected, the source said.”
Well, let’s see what else Griffin can run into the ground. I hope you guys weren’t attached to PWR and / or ULA.
Not a fan of Griffin, but this isn’t a very fair comment. Let’s not forget that the Fools Gold sold to everyone in the form of DIRECT 3.0, the “cheaper”, “better”, “sooner” alternative to Constellation that was the thorn in that projects side for years, when basically adopted in a slightly modified form as the Space Launch System, turned out to be just as outrageously expensive and probably pointless.
And yet the DIRECT acolytes and anyone who attacked Constellation in favor of something DIRECT – and consequently SLS like – gets off the hook.
DIRECT was a phantom that advanced a couple of blowhards who doubletalked themselves into the picture, taking advantage of helpless arsenal space veterans that wanted to take Shuttle components to the next level. Wanted to believe in Tinkerbell.
SLS is not DIRECT. SLS is CxP redux of some kind. You couldn’t do DIRECT because it was too cheap, too simple, too fast … for policy makers to cut earmarks for.
Shoulda. Coulda. Woulda. Not.
Anyone who believes Mike Griffin can even run a competent lemonade stand has lost credibility with me.
Look – he’s a great consultant, he can be a very smart guy, and he certainly get quoted in the press, and kisses up to all the industry potentates. But his practice of management leaves much to be desired.
So lets say you’re CEO of a newly independent Rocketdyne – what are you going to face? First, you’ve got no Shuttle contracts to count on, you’re stuck in too much R&D that now will come under schedule/budget pressure where every slip/overrun will be noticed.
And the AF will be breathing down your neck for cost reductions with little volume/production growth. And you have a lot of stale inventory to be sold off with few buyers, the need to work foreign contracts of an iffy nature, and you’re big new rival will be the PR highlight every 6months making you look like yesterday’s news.
To this a newbie CEO? Where his big claim to fame is influencing Congress as a rival to Elon Musk? Where he can’t even handle “message discipline” for Romney?
Wherever Griffin goes, he’s the smartest guy in the room. Wherever Musk goes, he’s the smartest guy in the room. I bet he and Musk would go off like a matter-anti-matter reaction if ever in close enough proximity. (yes, I do know they are collaborating on StratoLaunch – they probably use their avatars to communicate).
I wonder what he will say the role of private industry with NASA will be now… or will just try to get a cost plus FAR contract for engines.
This is scary. Maybe he will be titular head or maybe basically a CTO or something like that. I hope he won’t be running the business end.
On the other hand, this may be his chance to wipe the Constellation debri off and start over. Even if he doesn’t think he needs to.
Good for him. He’s was and is a first class engineer.
I’ve noticed his critics always devolve into personal invectives when attacking him. And that pretty much sums up exactly how much they understand what they’re talking about – zip.
—John
Yes, because his personal pet project – Ares I – was SUCH a great idea, and a wise use of resources! 😉 The man is an engineering fail as much as he is a management fail.
Thanks you for making my point!
He’s was and is a first class engineer.
As far back as 1962 and Von Braun it was known that a launch vehicle with a solid booster was a bad idea. The total impulse of the system wrongly matched between the stages and there is no way to fix it.
Additionally, and this was not as generally known at the time, is that the random vibrations of a solid system are far higher than on a liquid fueled booster. We who build payloads for both types of systems know that you have to design for much higher random loads and when those random loads are humans, which are bags of water at the engineering level, the payloads are easily damaged.
Griffin deserves the personal criticism he gets and much more than that. The reason people are so upset with Griffin is that he is dishonest and that he was trying to maintain an unjust monopoly over supplies of space launch and crew transport services for HSF to NASA and over use of the vehicles involved. He was trying to preserve an empire instead of seeking and encouraging to the maximum extent possible, the fullest commercial use of space. That is (severe) factual criticism.
And that pretty much sums up exactly how much they understand what they’re talking about – zip.
That on the other hand is vacuous personal invective. I know exactly what I’m talking about.
“He’s was and is a first class engineer. “
If you ever had a conversation with him, you would find that far from the truth. He attempts to be a devils advocate often, when it’s really a cover for being all gut and no brain.
My concern is that being a “first class engineer” makes you no more qualified to be a CEO than it does to be a NASA Administrator. They’re totally different skillsets. While some people are actually both great engineers and good leaders/managers, the skills are not strongly correlated. There’s definitely exceptions to that rule, but the “he’s a great engineer and it’s a rocket company so he should be a great CEO” is a scarily naive argument. He could work out, but a successful tenure or two as an entrepreneur or CEO is a much better indicator of future success than engineering talent, even for a rocket company.
~Jon
Folks:
Is this not just a case of ‘If you can’t beat ’em, join ’em’? Does Mike Griffin think he can pull off an ‘Elon Musk’?
I think that it’s gonna take a little bit more than just “Well, if he can do it, then…”.
Hey, Mr. Griffin. If you’re really interested in turning Rocketdyne into an innovative NewSpace company, I’ve got a unique launch vehicle idea for the RS-68s…
tinker
Griffin just wants to get all up close and personal with the prototype Aerospikes just sitting there in the warehouse. 😉
Actually he’d associated himself previously with Stratolaunch, which itself said it would use Space X rockets- so I am not seeing this connection.
We are missing something.
There is this, from a few months back:
http://www.parabolicarc.com…
What’s coming… Planetary resources?
Who or what will need not only what it has now, but what Rocketdyne can engineer and deliver in the next 5-10?
Mike is exactly what RocketDying needs to survive and regain it’s position in the field. Smart move.
Nope. Their issues are a) too much legacy stuff that costs more than it earns, b) too high cost development yielding too little volume, c) stagnant market most of which is threatened because it didn’t innovate enough to reposition for future, d) too much dependance on government contracts in a shrinking GDP time.
So … what can you do? Well, you can’t mess with EELV needs, but you can reduce your cost profile in serving them (fewer programs, more commonality, modernize flow of business). You need to make a decision as to which way to steer the rest of the business, either into reusability (you’ve got the best knowledge base given SSME) or expendables (RS68A not B), and you need to figure what the knee in the production curves (very hard) are going to be, so you have the right “menu” to feed customers and sell off (how?) all the rest.
You also need to get better at re marketing foreign engines than Aerojet is doing.
Yeah, a lot of scut work for a very experienced CEO. You can make it better.
…and, they don’t come any better than Dr. Mike Griffin!
He received the best gift anyone can ask for. He was head of NASA, and the president came out and laid it on a silver platter for him: retire Shuttle, come up with a sustainable BEO architecture, explore the solar system.
What did he come up with? Constellation – Ares I, Orion, Ares V.
He took the opportunity and threw it away.
Then, when Obama tried to clean up the mess, he became downright obstructionist, including the ugly episode with Neil Armstrong.
He should have been tarred and feathered for that.
Sigh. I can’t see what he brings to the table.
We have a president who promised to support NASA and has killed more NASA jobs than any other and is still fumbling around looking for the manual on how to be president after 3 1/2 years. Now we are going to some rock somewhere out there with dates slipping by starving funding. Obama is the MESS, he is worse than Griffin.
John, with all due respect, you don’t have a clue what you’re talking about. Some NASA jobs deserved to be killed, especially at the management level. Obama or more accurately Lori Garver wanted nothing to do with Constellation or Orion for good reason. A handful of flights for billions is a guaranteed failure. It will simply not last.
The fact is that thanks to this administrations push towards commercial providers, manned spaceflight has a chance in this country.
Given all the apparent intelligence in the aerospace community, you’d think people see that in more obvious terms.
Hey Nassau Goi, we have no president. He has gone after KSC jobs, killed jobs in Houston, Goddard. Huntsville, and now he is going after JPL. Now we fund companies that have not launched anything into space. Sounds like a really smart guy, all the while he will tell you he is creating jobs only 1 company is replicating what we did in NASA in the 1960’s. This is the BACKWARDS administration.
John,
Your comments make it clear that you have a vested interest in “old space.” Your claims re jobs are completely without context, and therefore say nothing that I can see. I think you need to take a closer look at what’s going on in aerospace outside of the little bubble that you appear to occupy. There are some important things happening these days and it would be worth your time to look into who is really doing what and who is making the changes possible, as opposed to those who are simply sticking with the status quo to their own detriment. Things are changing, for the better, and they will not revert back to the old ways. If you’re betting on SLS and Orion, I think you’re going to be mighty disappointed.
“we have no president”
Denying the President’s existence simply because you don’t happen to agree with his actions and/or policies is not particularly clever, in my opinion, and it disrespects the office he holds.
Steve
Obama has succeeded in getting a HSF flying post Shuttle on his watch. More than four presidents before failed at successor plans that resulted in any viable strategy.
CxP/SLS not viable. As to BEO/lunar, it is more likely, more fundable … that a BEO/lunar Dragon largely like the one that just flew, using a launch vehicle derived from most of the same parts of the Falcon that just flew. And a decade ahead, and for 1/10th of the tax dollars used.
But sorry no “arsenal space” on board. Too toxic!
add:
To the “two-bit” lawyers who complain about COTS-2
It’s a presurized capsule space craft. Goes up, comes down. Humans fit inside. Designed to transfer people.
Just because some idiots left COTS-D out … doesn’t make it not HSF. It’s still safer than STS-1 was.
Go back to playing denial games. That’ll really work well.
So from now on, eat a little crow and have it stick in your craw … everytime we pay for another Soyuz crew flight from Russia … to satisfy your personal invective.
Because you’d rather have that than “buying American”.
As former astro Tom Jones says: “Dragon took one giant leap last week in restoring an American path to space. We must follow up by accelerating the commercial effort, getting astronauts aloft well before 2017. We shouldn’t have to wait five more years for the NASA–commercial partnership to get off the ground.“
Which HSF is that?
enginear:
Dragon, Dream Chaser, CST-100, Blue Origin’s bi-conic capsule. Boy, pulling the plug on the FAR contracts and giving some seed money to ‘upstarts’ really lit a fire under the old guards… butts. Even ATK is chiming in with their ‘Carbon Orion’.
What do you want? Things are settling out quite nicely on the HSF department, thank you. Now, if you’re talking about a government program, that’s another story. If a company of less than two thousand can design, build and fly a launch vehicle and capsule, no government will ever touch that industry again. Pointless. Beneath them. Does a government make cars? Bail out the companies, yes, but design and build them? Hardly.
Now, if you want it to be an American human space program… well! You’ll have to be more convincing than the well oiled lobbyists of the major aerospace contractors who will spend more than it took Spacex to develop Falcon and Dragon just to have their way. Good luck!
tinker
justatinker
I might be a bit of a stickler here, but the statement was about the existence of a flying HSF. Maybe my definition is wrong, but I interpreted that as an actual active program and not just the path to such.
I was not trying to attack commercial space so relax with the Spacex accolades and defenses.
enginear:
Don’t take me seriously! LOL
My point is, it could be that because of the complacency of both government and NASA during the Shuttle decades, they’ve painted themselves into a virtual corner. I hate to say it but I think it comes down to an attitude of ‘greatness without purpose’, a lesson we should have learned from Apollo. NASA seems to be heeding the changing winds. The lawmakers… no so much.
Of course I see the billion Spacex has spent to development of Falcon/Dragon as one of the best investments of all time. They have succeeded as a ‘proof of concept’, that a small company with a (relatively) small investment, with the right people and a clear vision, can do wonders.
The ‘traditional’ aerospace companies should be trying to replicate what Spacex has done, not spend more money lobbying for their inferior products. If it takes spinning off a whole new lean, mean subsidiary with enough lead time and money to succeed, so be it. But they really gotta want to make a real profit in the open market and I don’t see that… yet.
tinker
There is no HSF flying post Shuttle. There has been one successful flight of a cargo version of Dragon. There are several S/C in development – none can be thought of as “flying”.
Anonymous_Newbie,
You are, of course, correct; there are no civil American HSF systems currently flying. However, if you are honest with yourself and make your best estimates on the time frames we’re likely looking at until we do have “HSF flying post Shuttle,” I think the point is made. There are several contenders in the industry, and SpaceX is clearly the current leader, but certainly not the only one likely to succeed. SLS and Orion, if they ever get finished, will come along years later than the others mentioned, and it will be much less “usable,” having very limited application and much higher costs than the alternatives. The important point is that the President defended the COTS-type solution, despite the constant attempts by Congress to cut it back and even kill it, while Congress instead has given us absolutely nothing as an alternative except a grossly underfunded SLS/Orion and no money for program/missions to use it on. Obama may not be a big space fan, but at least he’s not trying to kill American civil space like the old fossils in Congress are. So, which of the two options are you willing to put your money on?
Steve
You are judging NASA by how well it does as a jobs program. A sad end to what was once a proud agency.
Obama didn’t try to clean up anything, like most others, space is just a political chit to him. Space is dying from neglect and only on life support from a modicum of House support and inertia from projects started by the previous administration (that this one has yet to kill). The Porkulous kick-back fund was more money that NASA has had in total since its creation. Griffin changes his mind more often than most people probably change underwear, so predicting what he’s going to do becomes very Heisenberg in nature. Past performance doesn’t inspire a lot of hope and confidence either.
… the belief that you can manufacture a SpaceX rival from “arsenal space”. Using mirrors and a PR flack.
Pratt & Whitney probably saw there was no future for Rocketdyne and just wanted to unload it for whatever they could. Chase knows nothing about rockets, and isn’t really known for making smart decisions recently. They figured Griffin’s resume looked good on paper so he must be a good choice to run a space-related business. Poor suckers. They have no idea what a bad investment they just made. Maybe the people doing the deal don’t even care — kind of like the people making those subprime loans a few years back, their compensation is probably based on doing the deal, not whether it turns out to be a good investment in the long run.
Now that Rocketdyne is spun off and Griffin is at the helm, maybe Bain Capitol will step in and liquidate what’s left. That way Romney could be an adviser to Griffin. 😉
Awesome!
Today, even though all the studies indicate that a depot centric architecture is 57B cheaper over 20 years versus SLS HLV and that the HLV product lines are no longer needed, Congress has mandated a 70 to 130 metric launch vehicle. Further, the inflexible BEO architecture is cash strapped and is exclusive to HLVs and poor performance hypergolics that allow landers to sit on the moon for 120 days while the next HLV is readied to launch the crew for their 6 day sortie without cosmic radiation protection. COTS need not apply since it would just take more money than not launching the mandated HLV. NASA’s market for COTS ends with ISS deservicing. Recall that if both Shuttle and ISS were retired, Constellation would still need a few billion more for two lunar 6 day sorties per year. Perhaps some savings, even with the fourth new liquid strap on engine development, have been realized with SLS(?). Inspiration abounds.
So speculating, what Chase saw is that it will take a long time to even consider elimination of the HLV and EELV product lines, since they have a Congressional mandated induced market (not an earmark) to guarantee cash flow. Further, other government contracts could be gleaned from reusable air to space vehicles(?). Add in commercial dollars from aero engines, or other products, and it may be very likely that the 4B (?) loan is paid back in a acceptable time frame. All the result of implemented stall and delay tactics by congress influenced by lobbyists, paid by corporations.
While this plan does not follow engineering (which includes economics) or scientific logic (maximizes LVs rather than payload or technology development) and appears to be a “bad investment”, it does appear to follow political business logic (is this the correct phrase?) and may be a money maker, vital to capitalism ideology.
“Add in commercial dollars from aero engines, or other products, ….”
Say what? AFAIK, there’s no talk of P&W selling any part of its aero engines business; certainly not as part of this deal. The only airbreathing stuff at PWR is hypersonics R&D; no commercial products, nor anything that’s even close.
It’s not clear to me whether this sale includes *all* the PWR assets/programs, or only the Rocketdyne legacy stuff (i.e., excluding P&W legacy products like RL10), or whether P&W will retain its airbreathing hypersonics R&D capability… but in any case, I’m pretty sure no “commercial aero engines” are involved in the deal.
Oops. add space to aero.
“commercial dollars from other products or sale of aero”space” engines for commercial launches of EELV.
One other RD product is system design: designs and develops advanced technology systems for a wide variety of applications:
http://www.pw.utc.com/produ…
http://www.pw.utc.com/produ…
Also, like thousands of other companies during the economic downturn, dollars are being spent on automation, which translates to fewer jobs for the same level of productivity. Capital spent on automation and its reduction in the number of jobs is rarely discussed as a downside by “job creating” companies.
Fortunately for new space, the market for it will not end with conclusion of NASA’s involvement with ISS. Indeed, it might just be starting to grow. We’ll see.
Beyond that, federal access to LEO for whatever reason will probably cost less overall if done via commercial space rather than using Orion/MPCV.
I agree. Thats why my speculation is that it’s going to be bought by a partnership instead of a corporation. It would be too hard to rationalize purchasing a projected “slow growth” business to a board of directors of a corporation. A partnership generally doesn’t answer to a board of directors.
If this is verified, I’m hoping that Mike Griffin will excuse himself from any further role as a space adviser to Mitt Romney on the grounds of conflict of interest.
I keep hoping that Romney will excuse himself for the same reason.
Perhaps they are unaware, UTC CFO Greg Hayes said Rocketdyne was being sold in part due to it’s projected slow growth potential. In many business circles, thats considered a bad thing.
Correct. Its core business and key clients are the issue.
and as of right now, they have niether ;0)
I got an e-mail from Mike last night. This rumor is NOT TRUE.
Why would Chase be interested in a business that has one very unique product line (i.e. liquid rocket engines) and has limited growth options. The only business that I see that would be worse is a compnay that builds only solid rocket motors. Can anyone explain why a bank would do this??? It has to be connected with the UTC purchase of Goodrich and this was the only way to close the bigger deal?? Any ideas?? I just don’t see the deal making sense for Chase.
Chase wouldn’t be buying Rocketdyne. They would be buying Rocketdyne for a group of clients. Chase gets paid whether the clients make money or not. (Vulture Capitalism, as Rick Perry called it.)
UTC agreed to buy Goodrich for 16.5 billion, needed the 3 billion a Rockedyne sale would bring to pay for part of the deal
Rocketdyne will be sold, and when it is, and if Mike Griffin is part of the new team, I’d say he was better suited in the CTO role as opposed to the CEO. Though with his connections he would no doubt be helping whoever was the CEO. I still have a copy of Space Vehicle Design which he co-wrote. Now there’s a book that needs an update as the last edition was released in 2004. Maybe Elon & others can contribute to a revised third edition.
Noah,
The wrong people benefitted from his decisions!
Steve
Steve,
What
we have here is a forum for bashing Mike Griffin, the administration after Griffin is not being held in the same standard
that has been created. We had a goal to go to the moon now we do not. NASA is on it’s way down time for us to salvage it before the country goes broke. Yes I
support the new effort to have space privatized but we whined about how
expensive Constellation was. Now we are giving money to private firms for not
launching anything. This is a far cry from the way the Ortieg was awarded for
the first transatlantic crossing (http://en.wikipedia.org/wik…
it is shameful at the waste of money from the NASA budget while the unemployed
legion of NASA are suffering along with the rest of the country.
Obama has already disgraced the office on his
own, I simply elected to highlight that. It will be nice to see Garver and
Charlie find new jobs like the rest of us in the fall. Maybe Pratt &
Whitney are hiring.
This story still sounded fishy to me right from the start. Why would a liquid rocket engine company hire a solid rocket motor lover in any senior capacity? Why would they hire an engineer to get them out of serious marketing/management problems. It just doesn’t add up to me.
Steve
Rumors of suiters are no indication of real attraction. Rocketdyne has always had complaints about their rates from customers. That hasn’t changed and in the environment they are in right now, it has to. They have priced themselves out of todays market. They can’t get new contracts if nobody can afford them, a situation they were able to ignore in the past because of a lucrative shuttle contract.