Sen. Kevin Cramer, R-N.D., said he's worried the Pentagon will restructure the Space Force satellite program to rely on SpaceX for a significant portion of the work. (Ricky Carioti/The Washington Post)
Elon Musk’s SpaceX could significantly expand its share of military business as the Pentagon, faced with Trump administration budget constraints, considers overhauling a program to deploy hundreds of missile-tracking satellites.
In a Capitol Hill hearing last month, Sen. Kevin Cramer, R-N.D., said he’s worried the Pentagon will restructure the Space Force satellite program, which was designed to have multiple contractors, and rely on SpaceX for a significant portion of the work.
Cramer’s comments come at a time when Musk has consolidated enormous power and influence as a close adviser to President Donald Trump. Musk’s role as chief of the U.S. DOGE Service has concerned his rivals, who fear its broad access to government data could include their proprietary information, create conflicts of interest with Musk’s SpaceX, according to multiple industry officials who spoke on the condition of anonymity for fear of retribution.
Dramatically upending the Space Force’s satellite program would further consolidate power in SpaceX, which has followed an improbable trajectory from an outside startup that fought to disrupt the aerospace and defense industries to becoming the world’s most prolific rocket launch provider and satellite operator.
Competitors have fallen so far behind SpaceX that many fear they won’t be able to catch up, leaving NASA and the Pentagon with few other options as it faces increased competition in space from China and other nations. Musk’s hard-charging company rakes in billions of dollars from the U.S. government, flying everything from cargo to astronauts to some of the Defense Department’s most sensitive satellites. The company also operates more than 7,000 Starlink internet satellites in orbit, more than any other entity.
SpaceX’s successful track record means that “they don’t need to cheat,” said Todd Harrison, a senior fellow at the American Enterprise Institute. “They don’t need an unfair advantage. But the fact that Elon’s in the White House is going to make people wonder if there is some unfair advantage. There will be an asterisk next to every SpaceX win. It taints everything, whether it’s fair or not.”
Cramer’s office did not respond to a request for comment. SpaceX and the White House also did not respond. Musk has said that he will recuse himself from matters that pose a conflict of interest.
One industry official said Musk’s influence could shape policy and significantly alter lucrative programs. “If you’re standing beside the president, as closely as you are, then people around you fall into line pretty quick,” the person said. “He has so much power that … he doesn’t need to ask for anything. It’s just knowing that that’s the desire.”
The Space Force has repeatedly said that it wants to rely on a large number of contractors that would compete against each other and drive innovation, efficiency and lower prices.
Speaking during the confirmation hearing of Troy Meink, Trump’s pick for Air Force secretary, Cramer said relying largely on SpaceX in one of the Space Force’s flagship programs would go against its stated policy to “foster growth in the U.S. space industrial base.”
Meink, who serves as the principal deputy director of the National Reconnaissance Office, said he was not aware of any move to turn the program over to SpaceX, which operates a militarized version of its Starlink network known as Starshield for the Pentagon and intelligence agencies.
In a statement, the Air Force and Space Force said they are working with the Office of the Secretary of Defense “to evaluate all acquisition programs” at a time when the Trump administration is looking to cut the Pentagon’s budget by 8 percent so that the money can be used for new priorities. But the agencies said that “no decisions had been made” regarding the satellite system, known as the Proliferated Warfighter Space Architecture program, that Cramer cited.
The Pentagon is expected to spend $35 billion on the missile-tracking system, according to the Government Accountability Office (GAO). It’s not clear whether the Pentagon is considering canceling the contracts awarded earlier to Lockheed Martin, Northrop Grumman, York Space Systems and Rocket Lab, or if it would restructure an upcoming solicitation.
The SDA’s approach has been criticized by the GAO, which said in a report earlier this year that the program “has faced development challenges and delays and has not fully demonstrated the capabilities expected from it.”
Instead of relying on a few large satellites that are vulnerable to attack, the Pentagon is moving to what it called “proliferated architectures” that consist of swarms of smaller satellites that are more difficult to target and provide redundancy in case they are. In all, the missile warning system would have 300 to 500 satellites in low Earth orbit. It would consist of a “tracking layer” that would use sensors to follow missile launches and a “transport layer” designed to relay data throughout the constellation and to the ground.
The satellites would use laser technology to communicate, which is harder to intercept than radio frequencies. But the program so far has struggled with the new technology, according to the GAO, which said it has made only “limited progress demonstrating laser communications.” SpaceX, however, has experience with laser communications since Starlink uses it to transmit data across the constellation. That could help the Pentagon get the struggling program on track, some say.
It’s possible that the Pentagon could end up relying on a commercial system such as SpaceX’s Starshield for at least some of the transport layer as it looks to meet the budget cuts, said a person familiar with the program, who was not authorized to speak publicly.
The Pentagon has moved to allow for greater competition in another multibillion program: launching the satellites it increasingly relies on for modern warfare operations like precision-guided munitions, reconnaissance and communication.
To allow more companies to vie for the contracts, the Pentagon created two “lanes” of launch competitions. Lane 1 would allow new entrants to bid on individual contracts to launch satellites that are smaller and not as vital; Lane 2 would be reserved for more powerful and proven rockets that would hoist satellites that cannot risk failure.
On Friday, the Pentagon announced that SpaceX had won the majority of the lane contracts that run through 2029. SpaceX won $5.9 billion, while ULA was awarded $5.4 billion. Jeff Bezos’s Blue Origin won $2.4 billion, which is contingent on it earning certification for its New Glenn rocket. (Bezos owns The Washington Post.)
Last month, the Pentagon announced it was bringing two new companies into the first lane — Rocket Lab and Stoke Space — awarding them each $5 million to help them meet national security requirements. Neither has successfully launched the rocket they would use in the program, however, and they could still find themselves competing for contracts against the three Lane 2 providers: SpaceX, ULA and Blue Origin.
Some in the industry fear that even with new companies able to compete in Lane 1, the Pentagon may revert to going with SpaceX since its reusable Falcon 9 rocket has proved to be on the of the most reliable in history. In the fall, before Rocket Lab and Stoke Space were allowed to compete in Lane 1, SpaceX swept the first round of the new phase of national security launch contracts, winning $733 million for nine launches.
As a result, “it could be a real knife fight to break into Lane One and actually win launches,” Harrison said.
Peter Beck, the CEO of Rocket Lab, said his company was ready to take on SpaceX and whoever else might compete, either in the Pentagon’s satellite or rocket programs.
“It’s so important for the government to have a diversity of launch and a diversity of providers,” he said.
Musk’s role in DOGE and as a presidential adviser was more of a concern for SpaceX than its competitors, Beck said, because Musk’s potential conflicts would draw enormous attention to every contract SpaceX wins.
“It’s not a concern for me,” he said. “You know, if you’re going to create that level of scrutiny, you have to put your man pants on.”
