Virgin Galactic, the space tourism company founded by Richard Branson, has announced layoffs and expense cuts as it shifts its focus towards the development of its next generation Delta class of spaceplanes. While the specific number of layoffs has not been disclosed, the company stated that it is currently informing individual employees and will provide more details during an upcoming earnings call.
The strategic realignment is aimed at conserving resources and funding for the Delta vehicles, which are anticipated to offer more frequent flights and lower costs compared to Virgin Galactic’s existing SpaceShipTwo suborbital vehicle. This move comes as the company faces market uncertainty caused by high interest rates and geopolitical events, which have made access to capital less favorable.
To facilitate the development of the Delta ships, Virgin Galactic plans to close its facilities for the remainder of the week and streamline other work. This redirection of resources highlights the company’s determination to prioritize the advancement of its new spaceplanes.
Virgin Galactic reported having 1,166 employees at the end of 2022 and disclosed a cash and equivalents balance of $980 million at the close of the second quarter of this year. The layoffs and expense cuts indicate a strategic response to the current challenges faced by the company, particularly in light of the forthcoming Delta vehicles’ anticipated entry into service in 2026.
In addition to the layoffs, the company has also deferred work on a new line of mothership aircraft to carry the Delta-class spaceplanes aloft. It has additionally abandoned plans for another spaceplane, VSS Imagine. By tightening its focus and resources, Virgin Galactic aims to concentrate its efforts on the Delta class, which holds promising potential for the future of its space tourism ventures.
The impact of the layoffs on the operations of Virgin Galactic’s existing VSS Unity vehicle has not been explicitly stated. However, the last scheduled flight for this year has already been completed, with flights set to resume in January. This suggests that the company’s current operations will continue as planned despite the strategic realignment.
As the company navigates through these changes, investors and space enthusiasts alike will be keen to monitor Virgin Galactic’s progress and its ability to bring its next generation Delta class spaceplanes to fruition. The company’s vision of affordable and accessible space tourism remains unchanged, and these recent measures aim to ensure its long-term success in this evolving industry.
