Virgin Orbit, the satellite-launching subsidiary of Richard Branson’s Virgin Group, has announced that it will lay off 85 percent of its workforce and is ceasing operations “for the foreseeable future”. This news comes after the company failed to secure funding to keep it afloat. The layoffs are expected to be completed by April 3rd and will affect approximately 675 employees across every department.
The company had been investigating the mid-flight failure of its launch earlier this year which intended to demonstrate the UK’s plan to be a space nation of the future. In January, a Virgin Orbit jumbo jet took off from Spaceport Cornwall in Newquay while carrying a rocket under a wing. After flying over the Atlantic Ocean, the plane jettisoned the rocket before returning safely. Later investigation revealed that a dislodged fuel filter may have caused the failure.
Sir Richard Branson had injected £11m into Virgin Orbit in an attempt to rescue it but was ultimately unsuccessful. His cash injection is expected to cover most of the severance payments for those being laid off.
The layoffs will cost about $15 million including $8.8 million in severance payments and other employee benefits plus about $6.5 million in costs related to finding outplacement services and other requirements of US labor laws.
Virgin Orbit was put into space via four successful launches but struggled financially as it did not turn profitable since going public just this year with stock market valuation dropping significantly from $3.7 billion at IPO down when compared with recent valuations.
This is a developing story; we'll update as more information becomes available on this matter.