Virgin Orbit to cut 85 percent of jobs and ‘cease operations for the time being’

Space company Virgin Orbit will temporarily stop all activities after the company was unable to attract sufficient investments. In addition, 85 percent of the jobs will be cut and around 100 people will remain with the company. In January, a major rocket launch failed.

Virgin Orbits CEO Dan Hart has told staff that operations will be suspended for the time being, according to a recording shared with CNBC. “Unfortunately, we were unable to secure funding for a clear path forward for the company,” Hart says in the recording. “We have no choice but to implement immediate, dramatic and extremely difficult changes.”

Company reports to government agency SEC that about 675 jobs will be cut, or 85 percent of the number of jobs. Hart says he wants to support employees and, for example, help them find a job at sister company Virgin Galactic and give them a departure bonus. For that bonus, the company sold $10.9 million worth of shares to investment company Virgin Investments Limited. The three companies are part of Richard Branson’s Virgin Group.

Virgin Orbit wanted to launch rockets from a flying, modified Boeing 747. In January, the company wanted to launch satellites from Western Europe for the first time. This went well on missions in North America, but on the European flight the first ignition of the upper stage was terminated prematurely. The nine satellites were lost.

In mid-March, the company halted operations for a week while it looked for financing. Last week, according to Hart, the company had ‘very dynamic’ discussions with potential investors, but they apparently ultimately did not want to invest in the company. Virgin Orbit is a separate company from Virgin Galactic, which offers space tourism.