Elon Musk’s SpaceX to cut 10% of its workforce – Financial Times

Elon Musk’s SpaceX to cut 10% of its workforce – Financial Times

SpaceX, Elon Musk’s private space venture, is cutting 10 per cent of its workforce as it repositions itself for a new set of initiatives.

The Los Angeles-based company has expanded to some 6,000 people on the back of a successful private launch service that includes both Nasa and the US Air Force among its customers.

But Mr Musk has always viewed the launch service, which includes sending supplies to the International Space Station and putting commercial satellites into orbit, as a stepping stone to his bigger goal of reaching Mars. SpaceX said on Friday that the need to focus resources on “developing interplanetary spacecraft” was one of the reasons for the job cuts.

Along with its goal of launching a satellite communications network to deliver internet services around the world, this meant it needed to become “a leaner company”, SpaceX said, adding: “Either of these developments, even when attempted separately, have bankrupted other organisations.”

The job cuts come a month after SpaceX raised more than $250m in its latest round of private fundraising. Its valuation has climbed steadily as it has established itself as a reliable, low-cost launch operator, reaching $30bn with the latest round, three times what it was judged to be worth when Google and Fidelity Investments pumped $1bn into the company.

SpaceX carried out 20 launches in 2018, two more than the previous year, when it was bouncing back from a September 2016 launch pad explosion that threatened to disrupt operations. It also completed the first launch of the Falcon Heavy, a heavy-lift rocket designed to carry humans beyond the ISS in low earth orbit.

SpaceX would not comment on the number of job cuts it was planning, though one person familiar with the move put them at 10 per cent. “This action is taken only due to the extraordinarily difficult challenges ahead and would not otherwise be necessary,” the person said.

The first launch of the Falcon Heavy early last year brought huge interest in SpaceX’s progress in developing the capabilities to open up interplanetary travel. That could be matched this year if it succeeds in a plan to launch humans into space for the first time in its Dragon spacecraft — a feat that would mark the first time a private space company has put astronauts into orbit.

Sir Richard Branson’s Virgin Galactic last month claimed the record of being the first private company to put humans into space, after two test pilots reached a height of more than 50 miles, the point that the US government considers to be the start of space.

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