Virgin Galactic is cutting costs and reducing staff by 18% as it looks to scale production of its next-gen line of suborbital spaceplanes.
In a memo to staff sent Tuesday, Virgin Galactic CEO Michael Colglazier said that uncertainty in capital markets and geopolitical unrest have made “near-term access to capital much less favorable.” That’s not good news for a company like Virgin Galactic, which has simultaneously had to focus on scaling commercial operations of its initial vehicles, the VSS Unity suborbital vehicle and the Eve aircraft, while also working to create a fleet of next-gen ships the company calls Delta.
“The Delta ships are powerful economic engines. To bring them into service, we need to extend our strong financial position and reduce our reliance on unpredictable capital markets,” Colglazier said. “We will accomplish this, but it requires us to redirect our resources toward the Delta ships while streamlining and reducing our work outside of the Delta program.”
Overall, the company is laying off 185 employees, or 18% of its workforce, which will result in an annual cost savings of around $25 million. Colglazier added that the company will be calling each employee to confirm their employment status, and that these calls will continue through Thursday.
