🚀 go-pugleaf

In article <ewright.726798042@convex.convex.com> ewright@convex.com (Edward V. Wright) writes:
>In <1993Jan8.183031.12692@ke4zv.uucp> gary@ke4zv.uucp (Gary Coffman) writes:
>
>>Ok, let's try it another way. NASA sells Shuttle and it's support facilities
>>at cost to Rockwell. NASA then buys a *ticket* when it needs a launch on
>>Rockwell Spacelines, about 8 times a year. Rockwell Spacelines sells them
>>the tickets at about 1.5 times current Shuttle flight costs, got to recoup
>>the investment and turn a profit. The poor taxpayer takes it in the neck.
>
>How about this: NASA seels the Space Shuttle to Rockwell and negotiates
>a long-term contract at the same time.  The contract calls for NASA to
>purchase 8 flights a year, with penalties for nonperformance, at the same
>price NASA pays now.  This would be a no-profit contract if Rockwell
>spent as much to launch the Shuttle as NASA does, but Rockwell turns
>out to be surprisingly innovative, finds ways to bring costs down, 
>and makes a tidy profit.
>
>Since NASA has found it can reduce by contracting out many
>other operations to private companies (the workforce at KSC
>is mainly contractor these days, not NASA), why should the
>Shuttle itself be an exception?

This is basically the final scenario that I listed. NASA writes
off development costs and sells the hardware at depreciated
value. *Then* private operation can reduce costs enough to
turn a profit at current pricing, or less. At worst, NASA
breaks even, and the operations nightmare is off their
plate. The scenario you quoted didn't allow write offs and
depreciation because it sold *at cost*. The scenario you
deleted and recreated does allow these write offs which makes
profitable operations possible.

Gary
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