All the layoffs taking off with Virgin Galactic
Virgin Galactic, the aerospace company founded by Richard Branson in 2004, lays off staff as it focuses on Delta, the new airline fleet for space tourists
Virgin Galactic succumbs to layoffs.
In a Nov. 7 statement, the aerospace company announced a “strategic realignment of resources and related workforce reduction” to allow the company to focus on the development of Delta, the new space tourist airline fleet on which Virgin Galactic has pinned its future hopes, SpaceNews reports.
The move also stems from “growing uncertainty in capital markets,” CEO Michael Colglazier said in a note to employees, with higher interest rates putting pressure on lending and “geopolitical unrest” increasing caution.
In the note, Virgin Galactic's number one did not specify what impact the layoffs would have on the operations of its VSS Unity spacecraft. The aerospace company founded in 2004 by Richard Branson inaugurated commercial service on June 29 after almost 20 years of setbacks and delays with Virtute-1, (Italian flight for suborbital research and technology), the first suborbital mission Italian with crew from the Air Force and the Cnr.
On November 2, Virgin Galactic completed Galactic 05, its fifth commercial flight of the vehicle, carrying two researchers and a private astronaut. This was the vehicle's last scheduled flight this year as it and the VMS Eve enter an annual maintenance period. The company said after Galactic 05 that flights will resume in January.
All the details.
THE NEXT LAYOFFS IN VIRGIN GALACTIC
So Virgin Galactic said it will lay off staff and cut spending to conserve resources for the next generation of suborbital spaceplanes.
The company provided no details, including how many people would be affected, saying it was still in the process of notifying individual employees and that it would provide more information on its November 8 earnings call.
Virgin Galactic reported having 1,166 employees at the end of 2022 in an annual report filed with the Securities and Exchange Commission in February.
THE MOTIVATIONS
In the memo to employees, CEO Colglazier said the layoffs and other expense reductions are intended to preserve the company's funding so it can focus on developing Delta vehicles, which are intended to fly more frequently and at a lower cost than to its current SpaceShipTwo suborbital vehicle, VSS Unity.
He also cited “uncertainty” in markets caused by high interest rates and geopolitical events. This uncertainty, he said, “makes access to short-term capital much less favorable.”
Although it reported having approximately $980 million in cash and cash equivalents at the end of the second quarter of this year (along with a net loss of $134.4 million), Virgin has capital-intensive plans to upgrade its fleet of aircraft, moving from VMS Eve, the mothership, to a fleet of new Delta-class space planes.
DELTA PROGRAM RESOURCES
“Delta ships are powerful economic engines,” Michael Colglazier put it in black and white. “To bring them into service, we must extend our strong financial position and reduce our dependence on unpredictable capital markets. We will get it done, but that requires redirecting our resources to Delta ships, streamlining and reducing our work outside of the Delta program.”
The company did not disclose estimated costs for the development of Delta vehicles, but said it expects those vehicles to enter service in 2026. The company expects only limited revenue from VSS Unity, which is capable of flying monthly carrying up to four customers at a time. In Virgin Galactic's plans the new 'Delta class' space planes should fly once a week starting from 2026, up to 400 times a year.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/tutti-i-licenziamenti-che-decolleranno-con-virgin-galactic/ on Thu, 09 Nov 2023 06:55:11 +0000.