Virgin Galactic aims to launch new, $50M spaceships at Spaceport America in 2026

Officials for Virgin Galactic, the anchor of Spaceport America in southern New Mexico, recently delivered bad and good news for the fledgling spaceport as the company moves into its next phase of space tourism.

The bad news: The company is pausing spaceflights for about a year beginning in mid-2024 and, in January, is laying off 73 workers tied to the spaceport, located 56 miles north of Las Cruces and about 100 miles north of El Paso.

The good news: The company plans to begin test flights in mid-2025 of its new Delta spaceships, which will be built at its Phoenix factory for $50 million-$60 million each, and begin frequent flights for space tourists and researchers in 2026.

The changes will temporarily slow the spaceport's growth and economic impact, Scott McLaughlin, executive director of the New Mexico Spaceport Authority, said in a statement. But the future continues to look bright, he said.

While "there is short-term pain, there will be long-term benefits," he said. "Around 2026, we will see new employees hired in addition to flight cadences of the weekly and, eventually, daily variety."

Virgin Galatic is a key part of what McLaughlin and others have dubbed Space Valley, stretching from Albuquerque to Van Horn, Texas, where Amazon's Jeff Bezos' Blue Origin launches rockets for its space tourist flights.

Virgin Galactic to save $25 million with layoffs

Virgin Galactic will still employ about 200 people at its facilities and offices at the spaceport and in Las Cruces after the layoffs, a company spokesperson reported.

However, many of the New Mexico workers will temporarily go to the Phoenix factory in the future to support the final assembly stages of the first Delta spaceships, Michael Coglazier, Virgin Galactic chief executive officer, recently told Wall Street analysts. The factory is expected to open in April 2024.

The 73 laid-off New Mexico workers, including engineers and other technical personnel, are among 185 Virgin Galactic workers being laid off companywide, or 18% of its workforce. It will have about 840 full-time employees after the layoffs.

The layoffs will cost the company about $5 million, mostly tied to severance payments, but will save it about $25 million a year, company information shows.

Cost cutting aims to help Delta development

"The Delta ships are powerful economic engines. To bring them into service, we need to extend our strong financial position and reduce our reliance on unpredictable capital markets," Coglazier wrote in a Nov. 7, publicly released email to employees.

That requires cutting costs by reducing the workforce and reduced flights for the remaining schedule for its four-seat Unity spacecraft, he said.

The company had 10 space flights, but not until August 2023 did it fly its first paying tourists into space. Its first commercial flight with paying researchers was in June 2023.

Its Unity spaceship is carried to the edge of space by an aircraft that takes off from a runway at Spaceport America. The aircraft then releases the spaceship, propelled into space by its rocket. The flight ends with the spacecraft back to the Spaceport for a runway landing.

Its most recent flight was Nov. 2. It plans at least two more Unity flights next year, with the first in January, Coglazier reported. Then, by mid-year, it will stop those flights to focus on the Delta spaceship, he recently told Wall Street analysts.

Delta space flights will increase revenue

Virgin Galactic expects to greatly increase its revenue when the six-seat Delta flights begin, now expected in 2026. The six-seat Delta spaceships are expected to fly eight times per month, and the company plans to have two spaceships to start.

That's expected to bring in $2.7 million for tourism flights costing $450,000 per seat, and $3.6 million for research flights at $600,000 per seat, according to company information.

That would bring in $21.6 million to $28.8 million per month per spaceship, compared to the $1.8 million to $2.4 million generated by the one-per-month Unity flights.

Virgin Galactic is the largest of five tenants at Spaceport America. It leases the modernistic, 120,000-square-foot Gateway to Space building for an unreported amount. The lease expires in 2033, but spaceport officials are in preliminary discussions to extend it, McLaughlin said.

The Spaceport received $8.1 million in revenue in its 2023 fiscal year, ending June 30, including from leases and other sources, according to Spaceport information.

Virgin Galactic to use other spaceports in future

Virgin Galactic's Colglazier told Wall Street analysts that the company plans to eventually use other spaceports besides Spaceport America for its Delta spaceship flights. He did not provide specifics. The company leases facilities at the Mojave Air & Space Port in Mojave, California.

The company in August announced it had acquired land in Sierra County, near Spaceport America, for an astronaut campus and training facility.

McLaughlin said Virgin Galactic's plans for using other spaceports for flights "appears to be several years in the future once they have established a weekly or near-daily cadence at Spaceport America."

Spaceport America is an ideal location for the company's activities, and "we expect they will be here for many years to come," he said.

Vic Kolenc may be reached at 546-6421; vkolenc@elpasotimes.com; @vickolenc on Twitter, now known as X.

This article originally appeared on El Paso Times: Virgin Galactic aims to launch $50M spaceships in 2026 at NM spaceport