Bezos Slashes Price For Space Travel - Blue Origin Flights To Cost 'Only' $200,000

  • Written by Zero Hedge
  • Published in Economics

Jeff Bezos' space-travel company Blue Origin is preparing to sell its first tickets to wealthy wannabe space tourists as the company vies with Richard Branson's Virgin Galactic and Elon Musk's SpaceX to become the first to market in the commercial space-travel industry. According to Reuters, Bezos' price is an altogether-not-unreasonable $200,000, and if that estimate holds, Bezos will effectively have undercut Branson (who is charging roughly $250,000 for a seat on Virgin Galactic space flights) as the "everything store" founder and CEO takes his "Amazon-ing" pricing strategy to the stars. Despite the tremendous cost of a ticket, analysts expect Blue Origin and its peers will lose millions of dollars per flight, at least in the early years.

BO executives told attendees at a business conference last month that the company plans to begin test flights with human passengers on its New Shepard vessel (the company's reusable space rocket) in the not-too-distant future. It expects to start selling tickets next year.

Blue

Assuming the company succeeds in achieving its ambitious timetable, it could become the first firm in the world to launch a viable space-tourism business. Though right now, each of the three entrepreneurs vying for the title still have a shot of succeeding. While Branson's Virgin Galactic has already sold about 650 tickets for its first planned space voyages, the company has yet to set a date for its first space flight.

One Blue Origin employee with first-hand knowledge of the pricing plan said the company will start selling tickets in the range of about $200,000 to $300,000. A second employee said tickets would cost a minimum of $200,000. They both spoke on condition of anonymity as the pricing strategy is confidential.

Blue

Fortunately for Blue Origin's investors, the company already has several other businesses, including government contracts for space-exploration projects and satellite launching services.

All three are looking to slash the cost of spaceflight by developing reusable spacecraft, meaning prices for passengers and payloads should drop as launch frequency increases.

While Blue Origin has not disclosed its per-flight operating costs, Teal Group aerospace analyst Marco Caceres estimated each flight could cost the firm about $10 million. With six passengers per trip, that would mean losing millions of dollars per launch, at least initially.

Three sources said Blue’s first passengers are likely to include its own employees, though the company has not selected them yet.

Blue Origin's New Shepard is designed to autonomously carry six passengers on the more than 62-mile journey above the Earth's surface into suborbital space. The distance would be high enough to experience a few minutes of weightlessness and to witness the curvature of the planet, according to Reuters. Afterward, a pressurized capsule carrying the passengers will drift back to Earth using parachutes.

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