Trump-Musk dispute exposes US space programme’s reliance on SpaceX

Company's monopoly on high-profile missions starts debate on the need for more competitive industry

A public fallout between US President Donald Trump, left, and businessman Elon Musk has highlighted challenges facing the space sector and may open opportunities to other space industries. Photo: AP

A dispute between US President Donald Trump and billionaire Elon Musk that had escalated last week demonstrated a vulnerability of America’s space programme and the consequences of its reliance on one private company.

While the tension between President and billionaire has eased, the clash has exposed the risks of Nasa and the Department of Defence relying so much on SpaceX, Mr Musk’s aerospace company, to carry out critical missions from taking astronauts into orbit to developing battlefield communications.

The dispute unfolded on June 3, when Mr Musk criticised Mr Trump’s proposed economic policy on X, calling it a “disgusting abomination.” Mr Trump responded on Truth Social, threatening to withdraw “billions and billions of dollars” in government contracts awarded to his companies.

“The clash between President Trump and Elon Musk exposes both the vulnerability of SpaceX and the reliance of the US government on SpaceX’s capabilities,” said Laura Forczyk, founder of space consulting firm Astralytical.

“A healthy ecosystem needs multiple competitors to provide a variety of options for the space industry to choose from.”

A public fallout

US President Donald Trump uses his Truth Social platform to take a swipe at businessman Elon Musk after their working relationship began to fall apart. Reuters

Mr Musk escalated the situation by tweeting that SpaceX would begin “decommissioning Dragon,” referring to the spacecraft that carries Nasa astronauts to the International Space Station.

“Cancelling government contracts over social media spats could be a real-world consequence to escalating rhetoric in cyberspace,” said Evan Nierman, chief executive of crisis communications company Red Banyan.

“But there is no reason for that to happen, especially since all sides will lose.”

The Dragon capsule remains the only operational American spacecraft capable of transporting crew to and from the ISS, and its only rival, Boeing’s Starliner, has only just completed its first crewed test flight after extensive delays.

Before SpaceX, Nasa relied on Russian rockets and spacecraft for more than 10 years to ferry their astronauts to the station.

Strategic reliance

SpaceX launches most of the Pentagon’s military satellites, delivers cargo and astronauts to the ISS, and is developing the Starship vehicle that will serve as Nasa’s lunar lander for the Artemis programme.

Its Starlink satellite internet system is also being used by the US military and allied forces for secure communications, including in war zones and disaster areas.

“Nasa has already invested $4 billion in SpaceX to develop the Human Landing System, and at present, there are no near-term alternatives, so SpaceX is secure for now,” said Dimitra Atri, a planetary scientist at NYU Abu Dhabi.

Dr Atri said that the public dispute between Mr Trump and Mr Musk could prove useful in the long run.

“The feud essentially serves as a catalyst for diversification efforts that were likely needed regardless of political dynamics, given the strategic risks of single-source dependency,” he said.

During a press briefing on June 9, Mr Trump acknowledged the importance of Starlink despite his criticisms of Mr Musk, saying: “I may move the Tesla around a little bit, but I don’t think we’ll be doing that with Starlink. It’s a good service.”

Legal and political limits

A Falcon 9 rocket lifts off on Nasa's SpaceX Crew-7 mission, taking four crew members to the International Space Station (ISS), from the Kennedy Space Centre in Cape Canaveral, Florida, US. Reuters

Nasa's Jasmin Moghbeli, the European Space Agency's Andreas Mogensen, Japan Aerospace Exploration Agency astronaut Satoshi Furukawa, and Konstantin Borisov of Roscosmos walk to the launch pad before their mission to the International Space Station as Crew-7 on the SpaceX Crew Dragon spacecraft at Cape Canaveral. Reuters

The Falcon 9 carrier rocket with Nasa Crew-7 on board heads for orbit. Reuters

Japanese Crew-7 mission specialist Satoshi Furukawa leaves the Neil A Armstrong Operations and Checkout Building for Launch Complex 39A in Titusville, Florida. EPA

Crew-7's Danish mission pilot Andreas Mogensen. EPA

Crew-7's journey to the International Space Station begins at Cape Canaveral, Florida. The team will replace Crew-6, who include UAE astronaut Sultan Al Neyadi. Reuters

While Mr Trump has hinted at punishing SpaceX, any serious attempt to cancel or redirect federal contracts are likely to lead to legal challenges. Ms Forczyk said such actions would break procurement laws.

“Contracts by Nasa and the US Department of Defence are won by competition. In many cases, SpaceX is the best competitor,” she said.

“In a few cases, SpaceX is the only company capable of doing what the US government needs, such as launching astronauts to the International Space Station.

“Companies that feel they are treated unfairly can legally protest contract awards, as SpaceX did in 2014 and 2019.

“Political biases should not play a part in contracting decisions, and contracts under suspicion of political bias could be challenged in court. It would be illegal for President Trump to cancel a federal contract with SpaceX and give that same contract to a competitor company.”

Tough times at Nasa

The Trump–Musk dispute comes at a time when Nasa is under heavy funding pressure. A proposed budget cut of nearly 25 per cent for the 2026 fiscal year could jeopardise dozens of scientific missions.

“I don’t think it’s too far off to say that Nasa is facing its worst-ever crisis,” said Gordon Osinski, a planetary scientist at Western University in Canada.

“The Artemis programme to return humans to the Moon seemed to be safe but given the crucial role of SpaceX in this endeavour, even that could now be in jeopardy.”

The face of SpaceX

While SpaceX has consistently delivered on launch services and human space flight, its image is closely tied to Mr Musk’s unpredictable behaviour and political views.

“The SpaceX brand is so deeply tied to Elon Musk that it is seen as an extension of him,” said Mr Nierman.

“That makes the political risk of the Trump–Musk feud harder to contain. The company’s best move right now is to maintain institutional calm, keep its head down publicly, and double down on performance behind the scenes.”

He said that the firm’s long-term reputation would benefit from separating its operational excellence from Mr Musk’s personal identity.

A push for competition

The argument may serve as a catalyst for Nasa and the Department of Defence to broaden their portfolio of providers, by increasing investment in Blue Origin, Northrop Grumman and emerging launch firms.

Dr Atri said that while SpaceX currently leads in terms of capability and cost-efficiency, building a diversified and resilient space economy is in the national interest.

Blue Origin was awarded a second Human Landing System contract by Nasa, but its lander is not expected to be ready until after the 2030s.

“That company is rapidly building the capabilities needed to challenge SpaceX in rocket launches,” said Dr Atri.