ILS Forced to Lower Launch Prices in wake of Failures

International Launch Services (ILS) on March 18 said it has been forced to reduce prices in the wake of its December failure in order to accommodate customers paying higher insurance premiums to use ILS’s Proton heavy-lift rocket.

ILS said it hopes that its prices will recover as the Reston, Va.-based company proceeds with six planned launches between March and August and re-establishes its credibility among customers.

In a press briefing here during the Satellite 2013 conference, ILS President Philip R. Slack said the three failures of Russian Proton rockets in the past two years has caused insurers to bump up their rates for commercial Proton launches.

“A year ago we were within one-quarter or one-half a point of Ariane,” Slack said of ILS’s principal competitor, Arianespace of Europe.

“We would be a couple of points higher today. We obviously needed to respond to market pressure. We expect to be able to bring those rates back down with seven Proton launches in the next six months.”

The Russian Proton rocket is returning to flight with commercial Mexican satellite fleet operator Satmex’s Satmex 8 satellite.

The launch is scheduled for March 27 from Russia’s Baikonur Cosmodrome in Kazakhstan.

Following Satmex 8 is the scheduled mid-April launch of Canadian fleet operator Telesat’s Anik G1.

Proton will continue launching once a month through August.

Slack declined to disclose the order of the following launches.

Slack said the failure review board organized by ILS after the December failure, which met following a Russian government review, featured 15 ILS customers, three insurance underwriters and three industry experts.

Global insurance underwriters were briefed recently in Reston and London.

“Customer confidence is returning,” Slack said. “We need a string of launch successes, and we think when this happens Proton will win back the confidence of the market.”

The Proton vehicle has launched an average 10 times per year for the past several years. Slack said it should return to that rate this year.

The December failure — which put a Russian telecommunications satellite into a bad orbit, reducing the satellite’s service life --- forced ILS to a slow start this year.

Slack said that despite this, 2013 “should be a decent year for both launches and orders. We are hoping for five or six orders this year.”

Slack and John L. Palme, ILS’s vice president for programs and operations, said Proton prime contractor and ILS owner Khrunichev Space Center of Moscow, has embarked on a year-long quality-improvement program to bring the Breeze-M upper stage’s demonstrated reliability nearer to its theoretical reliability.

Several recent Proton failures have been laid to issues related to the Breeze-M stage.

Khrunichev has also begun development of a 5-meter-diameter fairing for Proton, a feature offered on competitor Arianespace’s Ariane 5 rocket, and by Space Exploration Technologies Corp.’s (SpaceX) Falcon 9 rocket, scheduled to begin making commercial flights later this year.

The larger Proton fairing is scheduled to be ready for flight in the second half of 2016, Slack said.

Khrunichev is also finishing what it calls the Phase 4 performance enhancement of Proton, which will increase the maximum weight of a satellite it can carry to geostationary transfer orbit to 6,350 kilograms, a 200-kilogram increase.