SpaceX to lay off 10% of its work­ers

Hawthorne-based aero­space com­pany, which has in­creased satel­lite launches, says it must get ‘leaner.’

Los Angeles Times - - BUSINESS - By Saman­tha Ma­sunaga saman­tha.ma­sunaga @la­times.com

SpaceX, cit­ing a need to get “leaner,” said Fri­day that it will lay off more than 10% of its roughly 6,000 em­ploy­ees.

The cuts were cited in an email sent to em­ploy­ees by Pres­i­dent Gwynne Shotwell, which was pro­vided to The Times. “This was a very dif­fi­cult but nec­es­sary decision,” Shotwell wrote.

“To con­tinue de­liv­er­ing for our cus­tomers and to suc­ceed in de­vel­op­ing in­ter­plan­e­tary space­craft and a global space-based in­ter­net, SpaceX must be­come a leaner com­pany,” the Hawthorne-based com­pany said in a state­ment. “Ei­ther of these de­vel­op­ments, even when at­tempted sep­a­rately, have bankrupted other or­ga­ni­za­tions. This means we must part ways with some tal­ented and hard­work­ing mem­bers of our team.”

Even with SpaceX’s ramp-up of satel­lite launches — 21 in 2018, an in­crease from 18 the year be­fore, and on Fri­day it had its first launch of this year — it has oc­ca­sion­ally cut its work­force. Last sum­mer, the com­pany fired some se­nior man­agers at the com­pany’s Red­mond, Wash., of­fice be­cause of dis­agree­ments over the pac­ing of the de­vel­op­ment and test­ing of its Star­link satel­lite program.

SpaceX makes most of its money from com­mer­cial and national se­cu­rity satel­lite launches, as well as two NASA con­tracts, one a multi­bil­lion-dollar deal to de­liver cargo to the In­ter­na­tional Space Sta­tion and the other up to $2.6 bil­lion to de­velop a cap­sule that will de­liver as­tro­nauts to the space sta­tion. The first launch of that cap­sule, with­out a crew, is planned for Fe­bru­ary.

The Elon Musk-led com­pany has even more am­bi­tious — and ex­pen­sive — plans. Musk has said SpaceX will con­duct a “hop­per test” of its Mars space­ship pro­to­type as early as next month. The pro­duc­tion ver­sion of that space­ship and its rocket sys­tem is ex­pected to cost bil­lions.

Ear­lier this month, pri­vately held SpaceX said it raised about $273 mil­lion in eq­uity and other se­cu­ri­ties in an of­fer­ing that sought to raise about $500 mil­lion, ac­cord­ing to a fil­ing with the Se­cu­ri­ties and Ex­change Com­mis­sion. The com­pany is worth $31 bil­lion, ac­cord­ing to Equi­date, which tracks pri­vate-com­pany val­u­a­tions.

In May, Shotwell told CNBC that the com­pany is prof­itable and has had “many years” of prof­itabil­ity.

SpaceX is of­fer­ing a min­i­mum of eight weeks’ pay and other ben­e­fits to laid-off work­ers, ac­cord­ing to Shotwell’s email. The com­pany will also pro­vide ca­reer coach­ing, re­sume help and aid with job searches.

SpaceX/EPA/Shutterstock

A SPACEX Fal­con 9 rocket lifts off Dec. 23 in Cape Canaveral, Fla., while car­ry­ing a GPS satel­lite.

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