NASA Human Space Exploration:

Persistent Delays and Cost Growth Reinforce Concerns over Management of Programs

GAO-19-377: Published: Jun 19, 2019. Publicly Released: Jun 19, 2019.

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Contact:

Cristina T. Chaplain
(202) 512-4841
chaplainc@gao.gov

 

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NASA is developing 3 systems to put astronauts into space—the Orion crew vehicle, Space Launch System, and Exploration Ground Systems.

In the past we’ve reported on concerns over the way NASA is managing these large and complex efforts—such as working to overly optimistic schedules.

NASA is unlikely to meet its recently revised launch date for the first test flight. In addition, its reporting of cost growth for SLS and Orion is distorted. We recommended that NASA adopt more transparent cost reporting practices.

NASA's acquisition management has been on our High Risk List since 1990.

A model of the Orion Crew Module in the Gulf of Mexico after a test

Orion crew module test model floating in the Gulf of Mexico with a Coast Guard boat.

Orion crew module test model floating in the Gulf of Mexico with a Coast Guard boat.

Additional Materials:

Contact:

Cristina T. Chaplain
(202) 512-4841
chaplainc@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

Due to continued production and testing challenges, the National Aeronautics and Space Administration's (NASA) three related human spaceflight programs have encountered additional launch delays and cost growth. In November 2018, within one year of announcing an up to 19-month delay for the three programs—the Space Launch System (SLS) vehicle, the Orion spacecraft, and supporting ground systems—NASA senior leaders acknowledged the revised date of June 2020 is unlikely. Any issues uncovered during planned integration and testing may push the launch date as late as June 2021. Moreover, while NASA acknowledges about $1 billion in cost growth for the SLS program, it is understated. This is because NASA shifted some planned SLS scope to future missions but did not reduce the program's cost baseline accordingly. When GAO reduced the baseline to account for the reduced scope, the cost growth is about $1.8 billion.

NASA's Reported Development Cost Growth for Space Launch System Compared to GAO's Assessed Development Cost Growth

NASA's Reported Development Cost Growth for Space Launch System Compared to GAO's Assessed Development Cost Growth

In addition, NASA's updated cost estimate for the Orion program reflects 5.6 percent cost growth. The estimate is not complete, however, as it assumes a launch date that is 7 months earlier than Orion's baseline launch date. If the program does not meet the earlier launch date, costs will increase further. Updating baselines to reflect current mission scope and providing complete cost estimates would provide NASA management and Congress with a more transparent assessment of where NASA is having difficulty controlling costs.

NASA paid over $200 million in award fees from 2014-2018 related to contractor performance on the SLS stages and Orion spacecraft contracts. But the programs continue to fall behind schedule and overrun costs. Ongoing contract renegotiations with Boeing for the SLS and Lockheed Martin for the Orion program provide NASA an opportunity to reevaluate its strategy to incentivize contractors to obtain better outcomes.

Why GAO Did This Study

NASA is undertaking a trio of closely related programs to continue human space exploration beyond low-Earth orbit. All three programs (SLS, Orion, and supporting ground systems) are working toward a launch readiness date of June 2020 for the first mission.

The House Committee on Appropriations included a provision in its 2017 report for GAO to continue to review NASA's human space exploration programs. This is the latest in a series of reports addressing the mandate. This report assesses (1) how NASA's human space exploration programs are performing relative to cost and schedule commitments, and (2) the extent to which NASA's use of contract award fees is achieving desired program outcomes. To do this work, GAO examined program cost and schedule reports and contractor data, and interviewed officials. This report does not assess the effect, if any, of the government shutdown that ended in January 2019.

What GAO Recommends

GAO is making four recommendations to NASA, including that the SLS program should calculate cost growth based on costs that are currently included in the first mission and the Orion program should update its cost estimate to reflect the schedule agreed to in its baseline. In addition, the SLS and Orion programs should reevaluate their strategy for incentivizing contractors. NASA concurred with three recommendations, and partially concurred with the recommendation related to the Orion program's cost estimate. GAO believes the recommendation remains valid, as discussed in the report.

For more information, contact Cristina T. Chaplain at (202) 512-4841 or chaplainc@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Priority recommendation

    Comments: NASA agreed with this recommendation. As of February 2020, NASA stated that it is conducting a rebaseline of the cost and schedule commitments for the SLS program and will document final decisions in an Agency Baseline Commitment decision memorandum. NASA officials anticipate they will complete this effort in Spring 2020. To fully implement this recommendation, NASA will need to measure cost growth using a baseline that reflects the scope of work currently planned for the first mission.

    Recommendation: We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the SLS program to calculate its development cost growth using a baseline that is appropriately adjusted for scope and costs NASA has determined are not associated with the first flight, and determine if the development cost growth has increased by 30 percent or more. (Recommendation 1)

    Agency Affected: National Aeronautics and Space Administration

  2. Status: Open

    Priority recommendation

    Comments: NASA partially agreed with this recommendation, stating that providing the estimate to the forecasted launch date rather than to the committed baseline date of April 2023 is the most appropriate approach. In November 2019, program officials told us that they will consider this recommendation as part of updating the joint confidence level analysis for the program's Key Decision Point D review. This review occurs before the program enters the system assembly, integration and test, and launch phase, and is not scheduled to occur until December 2020. To fully implement this recommendation, NASA needs to provide an updated cost estimate through April 2023.

    Recommendation: We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the Orion program to update its cost estimate to reflect its committed EM-2 baseline date of April 2023. (Recommendation 2)

    Agency Affected: National Aeronautics and Space Administration

  3. Status: Open

    Comments: NASA agreed with this recommendation and stated that the acquisition strategy for the second mobile launcher requires the use of 3D product modeling and that it will be the source for all engineering activities including integrated design reviews to demonstrate design maturity. It is too soon to assess the design maturity prior to construction start and we will provide updated information on actions NASA has taken at that time.

    Recommendation: We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the EGS program to demonstrate design maturity by completing 3D product modeling of the basic and functional design of the second Mobile Launcher prior to construction start. (Recommendation 3)

    Agency Affected: National Aeronautics and Space Administration

  4. Status: Open

    Comments: NASA agreed with the intent of this recommendation and stated that the SLS and Orion program offices reevaluate their strategies for incentivizing contract performance as part of normal contracting activities including contract restructures, contract baseline adjustments, and new contract actions. The Orion program has awarded a long term contract for production of the Orion spacecraft that incorporates new strategies intended to reduce contract costs. The SLS program is in the process of negotiating long term production contracts for required hardware.

    Recommendation: We recommend the NASA Administrator ensure that the NASA Associate Administrator for Human Exploration and Operations direct the SLS and Orion programs to reevaluate their strategies for incentivizing contractors and determine whether they could more effectively incentivize contractors to achieve the outcomes intended as part of ongoing and planned contract negotiations. (Recommendation 4)

    Agency Affected: National Aeronautics and Space Administration

 

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