Virgin Galactic announced 185 employee layoffs and that the company will “take a pause” for near-space tourism flights from Spaceport America in 2024.
In an announcement on Wednesday, just under 40% of the layoffs will be people working in New Mexico, according to a Worker Adjustment and Retraining Notification (WARN) letter sent to the New Mexico Department of Workforce Solutions.
None of the 73 employees are represented by a union, according to the notice.
Technicians, mechanics, inspectors, engineers, controllers, welders and an astronaut instructor, were all New Mexico positions included in the layoffs.
Virgin Galactic declined an interview and did not provide answers to emailed questions from Source NM determining which positions were laid off, or if there were severance packages.
The cuts to staff and flights will save money for Virgin Galactic to “redirect our resources” and build its new class of suborbital spaceplanes, said CEO Michael Colglazier in an all-staff memo.
The manufacturing site for “Delta-class” ships is still under construction in Phoenix, Arizona, with officials saying it will be online sometime next year.
In the third-quarter earnings call, Colglazier said Wednesday that the six near-space suborbital commercial flights out of Spaceport America “demonstrated the efficacy” of Virgin Galactic’s system.
“We are now stepping forward and placing all focus on safely, efficiently and successfully executing the Delta program,” he said.
He said after cuts, the company’s $1.1 billion balance should carry the company to 2026, when the Delta-class flights can carry paying customers. This would follow a flight-testing period in 2025 from Spaceport America, Colglazier said.
The Delta-class flights would have the ability to seat six people, and fly “twice per week” generating more revenue than the current Unity flights. He estimated the Delta-class ships would cost at least $50 million to $60 million to build, and would have a life-cycle of “500 or more flights.”
Colglazier celebrated the six commercial near-space flights, occurring once per month between May and November.
Those flights came after years of promises from the company.
Former Virgin Galactic CEO and billionaire Richard Branson promised spaceflight tours out of New Mexico since 2008.
He further announced that flights would start in 2011, 2014, 2015, and 2018.
Branson and five others in the first fully-crewed flight took off from the Spaceport in May 2021.
Once-monthly commercial flights started in 2023.
After a maintenance pause, at least two Unity flights in the current ship are scheduled for 2024. Customers can pay a “premium price” to fly in open spots on the remaining Unity flights.
“These seats, as they become available, have been priced closer to $1 million than to our prior price-point of $450,000.” Colglazier said.
The two flights planned for 2024 are projected to have revenues between $2 million and $2.5 million, he said. That’s four times greater than previous flights, putting revenues for Unity flights at about $500,000.
The increase, he said, was driven by adding another seat previously occupied by the astronaut instructor and added research revenue.
New Mexico Spaceport Authority Executive Director Scott McLaughlin said there are no concerns about Virgin Galactic’s lease payments or long-term operations in an emailed statement.
“We understand that numerous New Mexicans and their families have been impacted by this reorganization” McLaughlin said. “We wish them well and hope they find other employment in the area, including those who can continue in the region’s growing space sector.”
The spaceport authority said it will “continue to support other customers and continue to bring in new business and new companies to the spaceport.”
Virgin Galactic’s current lease with the spaceport extends through Jan. 1, 2033.
