SpaceX Rival Virgin Orbit Shutters Satellite Launch Business

The red-hot field of commercial space operations is losing a well-known player, with Virgin Orbit calling it quits for its satellite launch business. The company, which is a part of the Virgin Group and received extensive support from Sir Richard Branson, has decided to cease operations indefinitely. In its official SEC filing, Virgin announced that it is firing 675 employees, constituting nearly 85% of its net workforce in a bid to reduce operation expenses. The layoffs will be fully implemented by April 3, while the company is expected to fork nearly $15 million in employee severance package and other related expenses pursuant to local laws. In its SEC filing, the company says it is taking the drastic measure in the wake of its "inability to secure meaningful funding."

"We have no choice but to implement immediate, dramatic, and extremely painful changes," CEO Dan Hart was quoted as saying CNBC reports. In January, Virgin Orbit's first rocket launch from the UK soil was derailed due to a filter failure originating from the second-stage rocket. The company was planning to inject satellites aboard its LauncherOne rocket, tethered to a Boeing 747 aircraft that the company called Cosmic Girl. Like clockwork, the stock plummeted by over 40% in the wake of the botch, which was definitely not a good sign for a publicly-listed company that has not returned a profit since its inception.

Earlier this month, the company had put a pause on operations company-wide in a bid to sort its finances. Reports emerged earlier this month claiming that a Texan was reportedly in talks to invest approximately $200 million in the company, but those discussions never materialized, further deepening troubles for the company. Reuters reports that Virgin Group, which owns Virgin Orbit, injected nearly $50 million into the company, but apparently, that wasn't enough to save the satellite launch upstart. Notably, this won't be the first failure for Branson in recent times. Virgin Galactic has yet to kickstart its commercial spaceflight operations following multiple delays and snags. Plus, Virgin Galactic is burning through piles of cash without any success stories to show investors.

Branson was also quite bullish about Virgin Hyperloop which aimed to transport passengers across long distances through a vacuum tunnel at speeds of up to 760 miles per hour, but that idea also failed to catch on. With Virgin Orbit's supposed failure, the race for commercial satellite launch further strengthens the position of Elon Musk-led SpaceX, which has quickly become a favorite of both private as well as government agencies. Jeff Bezos-backed Blue Origin is emerging as another serious contender in the field with big space commercialization ambitions, alongside Arianespace, United Launch Alliance, and Boeing Defence.