Article Image
News Link • Future Predictions

Future Elon and SpaceX Domination Will Be Like Rockefeller and Standard Oil


John D Rockefeller created Standard Oil, which built up the modern oil and refining industry. Standard Oil created massive price advantages and scale beyond its competitors. It grew by increasing sales and through acquisitions. In 1868, the Lake Shore Railroad, a part of the New York Central, gave Rockefeller's a transportation rate of one cent a gallon or forty-two cents a barrel. This was a 71% discount for a promise to ship at least 60 carloads of oil daily. Smaller companies could not produce enough oil to qualify for discounts.

SpaceX already has a price advantage for rocket launch. They are already about ten times cheaper than ULA and have big cost advantages over Russia and China.

Standard was able to have kerosene prices drop from 58 to 26 cents from 1865 to 1870. Rockefeller used the Erie canal as a cheap alternative form of transportation to ship his refined oil from Cleveland to New York City.

Nextbigfuture has described how SpaceX has at least a six-year lead in reusable rockets. SpaceX is on track to lower launch costs by 5 times every four years. Competitors who are catching up in 6 years to where SpaceX is now will still be at a 10X price disadvantage. Competitors who are ten or more years behind SpaceX will be at a 100X price disadvantage. There will be virtually no competitive launch contracts to support competitors.

SpaceX will have Starlink and other satellites and space applications generating tens of billions of dollars each year in revenue. The Space industry is a $300 billion per year industry and only $8 billion is in launch. $3-4 billion is in commercial launches. $5 billion is in national military and government launches. SpaceX already has 60% of commercial launch.

Rockefeller used and enlarged his price advantages to ramp up his scale and had 90% of the global oil industry at its peak. At the point of Standard Oil's breakup in 1911, it had 64% of the global oil industry. This was nearly 40 years of domination for Standard Oil. The 34 companies that Standard Oil were broken into were hugely valuable. They were likely worth an inflation-adjusted $1.6 trillion. Rockefeller had 25% which was worth $400 billion.

SpaceX and Elon Musk will continue to improve the rockets after the reusability of rockets gets near the tens of thousands of reuses of passenger airplanes. The improvements for the next version of the Super Heavy Starship will be increased safety.

Join us on our Social Networks:


Share this page with your friends on your favorite social network: