Chapter 48: Fallout: 2018

SpaceX attempts its first two Falcon 1 launches in March 2006 and March 2007, both ending in failure. The first launch fails twenty-five seconds after liftoff due to a fuel leak from a corroded B-nut; the second reaches space but loses stability during second-stage separation due to fuel sloshing, crashing back to Earth at the eleven-minute mark. Despite these setbacks, Musk commits to trying again and implements lessons learned about risk management and component accountability.

On March 24, 2006, Elon and Kimbal Musk arrive at Kwaj for the inaugural Falcon 1 launch. After a sunrise bike ride with his brother, Elon enters the control room, where he immediately begins interrogating engineers about future Falcon 5 components rather than focusing on the imminent countdown—frustrating launch conductor Chris Thompson. At liftoff, the rocket climbs briefly before flames engulf the engine at twenty-five seconds; a fuel leak causes thrust loss, and the rocket falls back into the ocean, burning. That night, Musk tells his dejected team they will build another rocket and try again. Back in Los Angeles, as the team reviews video footage, Musk explodes at Tom Mueller, though tension dissolves when Musk screens Team America: World Police. Musk personalizes blame by identifying B-nut handler Jeremy Hollman as responsible; at a public symposium, Musk publicly references "one of our most experienced technicians." When Hollman returns to headquarters and confronts Musk, a shouting match erupts, and Musk refuses to retract his statement. Hollman leaves the company within a year. Later investigation reveals the B-nut was corroded by Kwaj's sea air, not Hollman's handling. After the first failure, SpaceX implements rigorous component testing and cost tracking. For the March 2007 second attempt, Musk accepts calculated risks, including omitting slosh baffles in the upper stage despite identifying fuel sloshing as the eleventh item on their risk list. The second launch succeeds in reaching space and separating stages cleanly; jubilation erupts in the control room. Within five minutes, however, second-stage wobbling appears on the video feed—the fuel is sloshing, causing the stage to spin uncontrollably. The payload crashes from 180 miles altitude. Musk responds by telling Koenigsmann that they will maintain eleven items on their risk list "never just ten," signaling acceptance of future informed risk-taking.