Virgin Orbit suspends operations, lays off 90% of employees
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Virgin Orbit, the troubled aerospace business established by British billionaire Sir Richard Branson, would suspend operations "for the foreseeable future" and lay off 90 percent of its employees, CEO Dan Hart told staff Thursday, according to CNBC, after the company failed to acquire finance to keep it alive.
Hart stated that the corporation would cut all but 100 roles, accounting for around 90 percent of the staff and that the layoffs would affect every team and department. According to an SEC filing, Virgin Orbit decided "to cut expenses in light of the company's inability to secure sufficient funding." The layoffs accounted for 675 positions or nearly 85 percent of the total.
Virgin Orbit will "provide a severance package for every departing" employee, Hart said, with a cash payment, the extension of benefits, and support in finding a new position — with a "direct pipeline" set up with sister company Virgin Galactic for hiring.
Layoff payments and other costs are estimated to total roughly $15 million
The company's terrible news comes just weeks after it suspended operations in an apparent attempt to shore up its finances.
According to the statement, Branson's investment firm Virgin Investments has invested $10.9 million in Virgin Orbit to "fund severance and other costs related to the workforce reduction."
Virgin Orbit estimates layoff payments and other costs to total roughly $15 million.
That comes amid media reports that the company's CEO has informed employees that the company will cease operations until further notice.
"We have no choice but to implement immediate, dramatic, and extremely painful changes," Virgin Orbit chief executive Dan Hart said at a meeting with employees, according to CNBC, which first reported the news.
Being a public corporation, Virgin Orbit has not made a profit since its founding in 2017.
It is part of Sir Richard Branson's commercial empire, which also includes the airline Virgin Atlantic and the space tourism company Virgin Galactic.
In January, Virgin Orbit attempted the first satellite mission launched from British territory, which failed.
The company's LauncherOne rocket, which took off from the Boeing 747 airplane Cosmic Girl, made it to space but fell short of its planned orbit.
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