David Senra

So rebuild from physics instead.

Don't ask, what do rockets cost?

Ask, what should rockets cost?

Elon eventually named this the Idiot Index, the ratio of the actual cost of a part to the cost of its raw materials.

If the ratio is high, he says, you're an idiot.

Consider the Falcon 1 actuator.

A vendor quoted $120,000 in 18 months of development.

SpaceX's engineers built it for $3,900.

When founding engineer Tom Mueller's team asked about a critical engine valve, the supplier kind of smirked and left after hearing SpaceX's timeline and budget.

Mueller's team made the valve themselves.

This pattern repeated across the vehicle.

The Dragon's capsule docking mechanism was reinvented from off-the-shelf bike shocks and catalog parts instead of adopting NASA's existing design.

There are probably a hundred examples like this, most not discussed in public.

The philosophy extended to fundamental architecture, SpaceX uses one propellant pair, liquid oxygen and RP-1 kerosene, across all stages.

The vacuum Merlin engine uses a fixed nozzle extension instead of a deployable one,

This is the main point.

Fewer moving parts means fewer failure modes means lower cost.

Compare this to the Atlas V rocket, which uses up to three different rocket types in a single vehicle, each optimized for its flight phase.

Elon's response to this was, you've just tripled your factory costs and all your operational costs.

And so he continues to give examples of how they think and all these little decisions they're making.