I googled. It seems they're at a 40% reduction as of Oct 2020 [0] for Falcon launches of government satellites, and could go lower but there's politics involved - as always in government-funded anything.

Is that correct? If so, then that's not "nowhere close", it's another order of magnitude away, for sure, but the high-volume approach of Spaceship could do that? Or not?

[0] https://www.fool.com/investing/2020/10/05/how-much-cheaper-a...

I don't remember if they promise 99% cost saving as you mentioned, but even if that's correct it's about Starship, at some unspecified point in future once they have flown regularly. They definitely didn't promise any such saving for 2021 launches. If Starship hasn't flown, how can they be "nowhere close"?

Market competition sets prices. Marginal cost = price only when you have competitive. Otherwise, you cannot use the advertised mission prices to determine their costs.

They could invent a rocket that does $500/kg to LEO and it wouldn't matter one iota to their actual costs if 1) demand doesn't go up and 2) competition doesn't exist.

They're getting closer. If they achieve rapid reusability with Super Heavy Starship then it'll be close to 99% reduction in costs.

Do we know their costs though? Even if they did achieve 99%, whats the incentive to reduce prices that far while the volume is this low?