Launch providers are skeptical that the coronavirus will have a lasting impact on the domestic market, although companies are implementing contingency plans in reaction to the outbreak.
“I do not think it will carry through,” said United Launch Alliance CEO Tory Bruno. “This will be something we deal with throughout the year, but no, I do not think it will have a lasting or chilling affect on our country’s priorities.”
The comments came at the Satellite 2020 conference in Washington March 10, where organizers have moved forward with the annual event despite the cancellation of multiple high profile conference due to concerns over the spread of COVID-19. A few major companies, including SES and OneWeb, pulled out of the event or significantly reduced the number of employees they sent, but otherwise the conference has been business as usual, albeit with noticeably lower attendance, hand sanitizer dispensers strategically placed throughout the convention center and attendees forgoing the usual handshakes.
During a panel at the conference, launch providers were asked whether COVID-19, which has threatened to affect F-35 manufacturing in Italy, will have a major impact on the domestic launch market.
“I will say, it certainly concerns us as it should concern everyone,” said Bruno. “We have pretty robust what we call business continuation planning (...). So we put together kind of detailed plans on what would happen if we lost a factory to a tornado, or had a fire, or had a pandemic. So those detailed plans are in place. They’re beginning to be exercised as we be proactive about this.
ULA is restricting both overseas and domestic travel to essential business, said Bruno. The company also has one employee who is in self quarantine after being exposed to someone, though the company has work from home processes to make this easier. Bruno said ULA would adjust its policies as it monitors the situation.
Charlie Precourt, vice president of propulsion systems for Northrop Grumman, agreed that contingency planning would be effective at minimizing any impact from COVID-19.
“I think we’re going to build a little bit more backlog here as things slow down and we’re going to come out of the barn charging. We’re going to have to,” said Precourt.
Launch providers are also keeping an eye on the supply chain providing the plethora of components needed to build and launch a rocket.
“We ask our suppliers to do the same things (as we are doing), and they generally do that,” said Bruno.
But again, the executives emphasized that contingency planning was a regular facet of business.
“We had a producer of some key materials have a fire in their facility and we had to execute with some contingency planning, but that’s what business is all about — having a plan and several contingencies to address what might hold you up so you can continue to be productive,” said Precourt.
Bruno credited the fact that the US launch market is largely domestic with helping to limit any coronavirus impact.
“The closest thing I think in my professional background would have been 9/11, when air travel was impossible and new priorities were in front of the country for the time being. We certainly weathered that storm. We will weather this storm,” said Bruno.
Nathan Strout covers space, unmanned and intelligence systems for C4ISRNET.