NASA OIG: Mobile Launcher 2 Will Cost Three Times More Than Planned

Keith’s Note: When Senator Administrator Bill Nelson walked in the door at NASA they thought Mobile Launcher 2 would cost $500 million. NASA OIG now says that it will have cost $2.7 billion by the time Bechtel delivers it. Add in delays and cost overruns in the overall Artemis project and the ever slowing launch cadence between missions and you have to wonder why NASA is building something that it simply does not need and probably never did. And when OIG suggests that NASA convert this to a fixed cost contract to nail down the final costs NASA says “no”. Bill Nelson gets mad about China beating the U.S. (back) to the Moon when NASA is doing a great job of allowing that to happen. According to OIG: “NASA projects the ML-2 will cost over three times more than planned. In 2019, NASA estimated the entire ML-2 project from design through construction would cost under $500 million with construction completed and the ML-2 delivered to NASA by March 2023. In December 2023, NASA estimated the ML-2 project would cost $1.5 billion, including $1.3 billion for the Bechtel contract and $168 million for other project costs, with delivery of the launcher to NASA in November 2026. In June 2024, NASA established the Agency Baseline Commitment (ABC)—the cost and schedule baseline committed to Congress against which a project is measured—for a ML-2 project cost of $1.8 billion and a delivery date of September 2027. Even with the establishment of the ABC, NASA intends to keep Bechtel accountable to the cost and schedule agreed to in December 2023. Despite the Agency’s increased cost projections, our analysis indicates costs could be even higher due in part to the significant amount of construction work that remains. Specifically, our projections indicate the total cost could reach $2.7 billion by the time Bechtel delivers the ML-2 to NASA. With the time NASA requires after delivery to prepare the launcher, we project the ML-2 will not be ready to support a launch until spring 2029, surpassing the planned September2028 Artemis IV launch date. NASA officials disagree with our analysis and expect cost growth to lessen over time now that Bechtel has started construction of the launcher. The Agency believes this is an area of expertise for the contractor. While progress has been made with the beginning of construction of the ML-2, it is still too early to determine the impact on the contract’s continued cost growth and whether Bechtel can achieve and sustain an improved level of performance throughout the construction phase.” Full report: NASA’s Management of the Mobile Launcher 2 Project