Why has SpaceX been able to reduce rocket launch costs to one-tenth of traditional aerospace through first-principles thinking?

Okay, let me give you an analogy that I guarantee you'll understand.

Imagine traditional aerospace companies are like top Michelin chefs. When they cook (build rockets), they use only the finest, pre-prepared ingredients (components) that others have processed. For example, if they need a special screw, they buy it directly from a supplier specializing in aerospace screws. This screw might cost thousands of yuan, because the supplier also needs to make a profit and amortize R&D costs. Thousands of parts for an entire rocket are procured layer by layer like this, with markups at every stage, naturally leading to a sky-high price for the final rocket. Moreover, this rocket is discarded after a single use. It's like spending millions to have a chef prepare a lavish Manchu-Han Imperial Feast, only to throw away all the golden bowls and silver chopsticks afterward. The next time you want to eat, you have to buy a whole new set.

Now, Elon Musk and his SpaceX have arrived. He's the "madman" who thinks with "first principles."

He doesn't ask, "How much does a space-grade screw cost?" Instead, he asks, "What does it take to make a screw? Isn't it just a specific grade of metal? How much does that metal sell for per ton on the market?"

He breaks down a rocket into its most fundamental raw materials: aluminum alloy, titanium alloy, carbon fiber, fuel... Then he checks the prices of these raw materials on the London Metal Exchange. He found that the cost of all the raw materials needed to build a rocket accounts for only about 2% of the rocket's final selling price.

What accounts for the remaining 98%? It's design, manufacturing, management, the profits of various suppliers, and most importantly—the enormous waste of "single-use."

So, the crux of the problem becomes clear:

First, do it yourself and be self-sufficient. Since buying parts from others is so expensive, I'll build them myself. SpaceX is known as a "manufacturing powerhouse," doing everything in-house from engines to rocket casings to control software, outsourcing nothing they can do themselves. This is like buying your own groceries, washing them, cutting them, and cooking them yourself. While it might be a bit more work, you cut out all the middlemen's markups, and costs naturally come down. This is what's called "vertical integration."

Second, and most crucially: reusability. Since the raw materials themselves aren't expensive, but the process of assembling them into a rocket is, the biggest way to save money is not to throw the rocket away! Let it fly back, repair it, refuel it, and use it again next time. It's like when we fly on an airplane; a Boeing 747 doesn't get thrown into the sea after one flight, does it? It lands at the airport, gets inspected and refueled, and flies its next route tomorrow.

SpaceX's Falcon 9 rocket, specifically its most expensive first stage, can vertically land itself back on a ground or sea-based recovery platform after launching satellites. This single capability saves 70-80% of a rocket's cost. This was unimaginable before, because the old logic was, "a rocket is just a big firework; once it's launched, it's gone." Musk, however, starting from the fundamental physics, reasoned, "As long as there's enough fuel and precise control, why can't it fly back like a helicopter?"

To summarize:

Traditional aerospace uses "analogy thinking": Our rockets used to be this expensive, so new rockets must also be this expensive. SpaceX uses "first principles thinking": Forget what rockets used to be like. From a fundamental physics perspective, a rocket is just a pile of metal and fuel, and its cost should be very low. Our goal is to find a way to assemble these components at the lowest possible cost and make them reusable.

In essence, SpaceX, by "returning to common sense," has brought space travel, once an "aristocratic" activity, back to a cost logic more akin to "manufacturing" and "transportation."