Hondas in Space

SpaceX is a creative mix of new school and old school, of dotcom and DEFCON, of 1999 and 1969. On the dotcom side, the kitchen is constantly replenished with cookies, Clif Bars, juice, and chips. Musk's four dogs are regular visitors. There's an air-hockey table and a few Segways strewn about for general use. And there are a lot of geeky-looking guys hard at work, most of whom choose to wear SpaceX T-shirts every day. ("I said, 'Wear your regular clothes, people!' " says Mary Beth Brown, Musk's assistant. "We're not a cult!") SpaceX has much of the feel of a software company about to release a new product. But these guys can't put out a fix if something goes wrong. "You can always patch a software release," says Musk, who, yes, does own two jets and one Russian fighter plane. "It's hard to patch the rocket."

Yet there are lots of things happening at SpaceX that have little to do with the table games or the free snacks. Musk is funding the company himself, and he has challenged his employees to do more with less. By getting people to think creatively about cost, he thinks he can alter the economics of space for good. "Many times we've been asked," he says. " 'If you reduce the cost, don't you reduce reliability?' This is completely ridiculous. A Ferrari is a very expensive car. It is not reliable. But I would bet you 1,000-to-1 that if you bought a Honda Civic that that sucker will not break down in the first year of operation. You can have a cheap car that's reliable, and the same applies to rockets."

To save money, SpaceX's engineers pride themselves on tweaking existing technologies and looking beyond the aerospace world for inspiration. There may not be hundreds of patents in Falcon I, but the scientists don't care. What they want is a rocket that flies. So the main engine isn't a 21st-century design but rather a 1960s-era pintle engine, which has only one fuel injector rather than the "showerhead" or flat-faced injector used in most rockets. It is old, but reliable.

At SpaceX, no money-saving idea is too wacky, so long as it works. Instead of buying a new theodolite, a tool used to align the rocket, an employee bought one on eBay, saving $25,000. When doing research on the fairing, an enormous piece of metal that protects the payload, Chris Thompson, VP of production operations, discovered an old one in an industrial junkyard and had it transported back to the shop for testing.

The company has also borrowed parts and technology from other industries, heresy in such a specialized realm. Falcon I's first stage is partly reusable, and will land in water. Typically, to hire a company specializing in rocket retrieval costs about $250,000. But there are commercial salvage companies accustomed to handling sensitive equipment. A bit of research located Sause Bros., a tug-and-barge company that has agreed to pull in the rocket for $60,000.

In avionics, rather than using an aerospace computer on the rocket, which could cost as much as $1 million, Falcon I will fly with the same kind of computer used in an automatic teller machine for a cost of $5,000. And rather than relying on the costly electronics that NASA and others are wedded to, Falcon I will use an ethernet bus for communication between the rocket's different computers. "I didn't want to invent anything new," says Hans Koenigsmann, SpaceX's VP of avionics and systems.

Once liberated from the constraints of thinking like, well, rocket scientists, SpaceX's employees found inspiration in odd places. While looking for a low-cost way to make tanks, Thompson drove by a milk truck and stopped cold. "Those things are mass produced, there are hundreds on the road, and not a lot of failures," he thought. "Couldn't we use something similar?" He met with the manufacturer and ultimately realized it wouldn't work. But it might have.

Yet SpaceX is not about low cost at any cost; it is the yin and yang of Musk's practicality and his willingness to spend when necessary that gives SpaceX an edge. At SpaceX, VPs don't need to fill out cumbersome requisition forms in triplicate when they need to buy equipment: They are trusted to find the practical, lowest-cost solution, and they just buy it. If it costs more than $5,000, they walk upstairs to Musk's messy cubicle and simply make their case.

"Elon has really opened the checkbook for me," says Bob Reagan, the ponytailed, gravel-voiced VP of manufacturing. "All he ever asks me is, 'What do you need?' " That trust -- and the fact that all employees are stockholders -- spurs them to try to save Musk money. "It doesn't make any sense to hurt the house," Reagan says. "If we can save a penny, we do."