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In That Number

less than 17 hours

Rocket Lab launched its Pioneer payload into orbit less than 17 hours after receiving a notice-to-launch order from the U.S. Space Force, showcasing another dramatically reduced deployment time for time-sensitive national security assets.

On the Radar

SpaceX

SpaceX Starfall. This week, SpaceX launched something new into space: a 10-foot disk-shaped "Starfall" reentry capsule. The 4,600-pound vehicle is designed to return up to 2,200 pounds of cargo from low-Earth orbit. When it occurs, the initial ‘star fall’ will test atmospheric reentry and a parachute-assisted splashdown in the Pacific Ocean.

  • The Merge's Take: Remember the Air Force’s 2021 Rocket Cargo program that wanted to blast military stuff from one place on Earth to another using space rockets? Well, that’s how long SpaceX has been working on this. They were awarded a 5-year $102M OTA contract in early 2022 for rocket cargo, so the timeline checks (we think it pivoted from Starship to Falcon 9 due to Starship delays; makes sense to start with a proven rocket to mature the capsule). Rocket Cargo evolved into Point-to-Point Delivery (P2PD) and Rocket Experimentation for Global Agile Logistics (REGAL), which collectively have about a dozen companies on contract with <$2M awards. On the non-military side, SpaceX’s effort could be a massive market validation for the commercial orbital reentry sector.

USAF

T-7 Turbulence. A new three-part series on the Air Force’s T-7 jet trainer program reveals that the first 82 jets will fly with "serious" airworthiness risks due to missing safety data; the program faces "high risk" sustainment due to lack of data rights; and the program may split engines from Boeing’s responsibility in exchange for gaining more data rights to the 747-based E-4 Doomsday plane.

  • The Merge's Take: The three-part series (linked above) is worth the clicks. In 2018, Boeing won the $9.2B fixed-price contract for 351 T-7 jet trainers, and 8 years later, the pain train continues. Boeing has lost $3.2B (and counting) on this program so far, and the entire saga is hard to watch. It’s a basic jet trainer, something straightforward that several other companies already produce and successfully sell. It’s not like they are trying to build a bleeding-edge 6th-gen fighter jet…😬

  

DoW

Ukrainian Drone Diligence. Recent due diligence of 15 deals exploring the acquisition of Ukrainian defense startups highlighted 4 trends that make M&A challenging. While the drones may be highly effective on the front lines, most of Ukraine’s drone makers operate as basic assembly shops with limited defensibility, no intellectual property, export restrictions, and a heavy 75% reliance on Chinese components.

  • The Merge's Take: Treat this as a data point in time, not gospel. Those four issues are all byproducts of how the start-ups came to exist: Russia invaded their country. Despite this, there are several efforts to professionalize Ukraine’s defense industry. While the war rages on, in the near term, expect to see more partnerships and joint ventures, such as the five Ukrainian companies competing in the U.S. Drone Dominance initiative. Or the new joint venture between Roboneers & ARX Robotics for UGVs. These arrangements work by pairing Ukrainian performance and cost-engineering muscle with more mature corporate structures.

 

USA

Low-Cost Interceptor. The U.S. Army officially stood up its Low-Cost Interceptor (LCI) program to stop firing expensive missiles at cheap enemy drones. LCI’s approach is to break the missile apart and compete the pieces—including seekers, rocket motors, and fire control—then find a contract manufacturer to build the all-up-rounds (AUR) from those Army-directed components. The call for white papers is on July 6, they want nontraditional contractors, and they want to host live-fire demos in 5 months.

  • The Merge's Take: There are 3 big assumptions LCI is making: 1) breaking the missile apart will be collectively cheaper than any industry-produced AUR, and 2) the Army must buy all the IP to maintain long-term price controls. Time will tell how this goes, but “cheaper” is relative. Assumption 1 is straight from Elon Musk’s idiot index, which he used to bring launch costs down 90%—but he spent 15 years and ~$30B to do it. Which leads us to assumption 3: LCI will be much harder than the Army thinks.

 

USN

F-35 Logistical Mess. The F-35 program has stated its global fleet of 1,300+ jets has massively outgrown the logistical infrastructure to support it, which is one of the main drivers for the fighter’s low readiness. The program estimates it can support only 800 aircraft and will need a whopping $13.7B and 5 years to address issues with spare parts, depot capacity, and maintenance plans to support the larger fleet.

  • The Merge's Spicy Take: The same office that manages the program aiming to produce 150 jets a year for the next 20 years is also saying its support system was only designed to sustain 800 aircraft? YGBSM. If only there had been reports at any point in the past decade that highlighted the forthcoming issues with spare parts, depot capacity, and maintenance plans due to the volume of aircraft being procured versus the lack of resources to sustain them once they are delivered. Well, they are here, here, here, here, and here. At what point does F-35 readiness become gross negligence?

TRIVIA

On this day in 1927, Lieutenants Lester Maitland and Albert Hegenberger completed the first-ever nonstop flight from the U.S. mainland to Hawaii. What was the nickname given to their plane?

A) Spirit of St. Louis 
B) Bird of Paradise 
C) Pacific Clipper 
D) Hawaiian Eagle

USAF

They Said It

“workflows enabled U.S. forces to deploy over 2,000 munitions to 2,000 distinct targets within 96 hours during Operation Epic Fury, a testament to the greatly increased operational utility made possible by the Grok Gov Model.”

— Cameron Stanley, the Pentagon’s Chief Digital and Artificial Intelligence Officer, in a court filing detailing the military’s use of xAI’s Grok during the Iran war

ICYMI

Mach Industries Series C valuation raises the question: is the factory capacity enough to justify the valuation when the products cannot?

Knowledge Bombs

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ANSWER
B) The Bird of Paradise was a specially modified Fokker C-2 trimotor used to complete the 2,407-mile trek from Oakland to Honolulu. The 25-hour-and-50-minute flight was a massive technical challenge, requiring experimental radio beacons situated in San Francisco and Maui to navigate to the small island chain in the middle of the vast Pacific Ocean. This effort showed that the U.S. military could project air power far beyond its coastal borders. For their efforts, Hegenberger and Maitland were awarded the Mackay Trophy and the Distinguished Flying Cross.

USAF

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