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SpaceX wins its second Air Force launch contract, beating out the United Launch Alliance

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Photo: SpaceX

SpaceX has beat out the United Launch Alliance to win its second launch contract from the US Air Force. The contract, valued at $96.5 million, entails launching the Air Force’s third GPS III satellite sometime in 2019.

It’s the second time that SpaceX has won a launch contract from the military, but it’s the first time that the company competed with ULA for the gig. SpaceX received certification to launch military satellites in 2015 and then won its first Air Force launch contract in April 2016: a contract valued at $87.2 million to launch the military’s second GPS-III satellite. However, SpaceX essentially won the contract by default, since ULA — the only other launch provider certified to launch Air Force satellites — declined to bid for it. “SpaceX is proud to have been selected to support this important National Security Space Mission,” SpaceX President Gwynne Shotwell said in a statement. “We appreciate the confidence that the U.S. Air Force has placed in our company and we look forward to working together towards the successful launch of another GPS-III mission."

In fact, ULA, a joint venture between Boeing and Lockheed Martin, has been the sole launcher of military satellites for the past decade. But when it came time to compete with SpaceX for an Air Force launch contract, ULA claimed that it would not have its main rocket, the Atlas V, available for the mission due to restrictions from Congress. Additionally, a former ULA executive claimed that the company didn’t want to get into a “cost shootout” with SpaceX. However, ULA said it would compete for the third GPS III satellite.

And there could be even more SpaceX and ULA competitions coming up. The contract that SpaceX won today was the second of nine launch contracts the Air Force plans to put up for bid through 2017. And it’s hard to ignore the cost differences between the two companies. SpaceX claims that one launch of its Falcon 9 rocket starts at $62 million, while the baseline price of the simplest version of an Atlas V starts at $109 million, according to ULA CEO Tory Bruno. And just a year ago, the Atlas V was starting at $184 million. However, ULA has argued that the Air Force should factor in reliability and not just cost when making decisions about which vehicles will launch military satellites.

3/15/17 11:02 a.m. ET Update: This story has been updated to include a statement from SpaceX.