Virgin Galactic will cut jobs and reduce costs as part of a “strategic realignment” to fund its “Delta Class” spacecraft.
The company, in Orange County, California, told staff it faced challenges in securing funds.
It also cited rising interest rates and global political instability as reasons for the cuts.
CEO Michael Colglazier stressed the need to focus the company’s efforts on the completion of the “Delta Class” vessels.
These are are anticipated to enter commercial operation by 2026.
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In a letter to staff published on the company’s website, he said:
“To profitably scale our business, we must first invest upfront capital to create a fleet of ships based on a standardized production model — the Delta Class ships.
“Recently, however, uncertainty has grown in the capital markets. Interest rates remain high, which adds pressure to companies who are investing today for profits that will come in the future.
“Geopolitical unrest continues to expand, and the combination of these factors makes near-term access to capital much less favorable.
“We are going to succeed in this environment by focusing our full company efforts on the safe, efficient, and successful completion of our Delta program that will allow us to create positive cash flow. Looking to boost your online brand? Create your FREE business profile at WhatBiz? Here.
“By taking these actions now, we ensure Virgin Galactic continues to have access to the funding needed to deliver on our mission — bringing the wonder of space to both our existing customers and to the generations of customers who will follow.”
He thanked the staff who are likely to leave, saying: “These actions, while necessary, come with great impact.
“Our teammates who will be leaving Virgin Galactic are talented, purpose-driven, and they excel in their professions… and it is deeply unfortunate to part ways with some of our co-workers and friends.
“I am very sorry these changes will impact you so directly.
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“I am grateful to you for the work you have done”
“I want to thank each of you for the talent, passion, and perseverance you have put into our company each day — we became a commercial Spaceline this year thanks to your efforts, and I am grateful to you for the work you have done to advance the dream of opening access to space for generations to come”
From Tuesday to Thursday, individual employees will be contacted to discuss their ongoing roles.
Following these discussions, Virgin Galactic has directed that all staff will operate remotely for the rest of the week.
