Virgin Orbit Shuts Down After Bankruptcy Sales

Virgin Orbit, a bankrupt rocket company spun off from Virgin Galactic, is shutting down after selling its facility leases and equipment to aerospace companies in an auction. CNBC reports: Spun out of Virgin Galactic in 2017 by founder Sir Richard Branson, Virgin Orbit reached rarefied air by flying multiple missions. But difficulty raising funds, and slow execution, brought the once multibillion-dollar company to bankruptcy and ultimately shut down. Monday's auction bids amount to about $36 million in total. Virgin Orbit's six or so rockets that were in various stages of manufacturing assembly, and its intellectual property, have yet to be sold, a Virgin Orbit spokesperson confirmed.

Rocket Lab successfully bid $16.1 million for the company's headquarters in Long Beach, California, which is about 140,000 square feet, the spokesperson said. Although founded in New Zealand, Rocket Lab was already a neighbor of Virgin Orbit, with a headquarters and facilities in the Long Beach area. Additionally, Rocket Lab's purchase includes assets such as 3D-printers and a specialty tank welding machine. In a press release, Rocket Lab said the Virgin Orbit assets will improve its production, manufacturing, and test capabilities, especially in developing its larger Neutron rocket.

Stratolaunch was awarded its $17 million "stalking horse" bid for Virgin Orbit's 747 jet. A Stratolaunch spokesperson, in a statement to CNBC, said the company "continually evaluates ways to increase our capacity to meet the imperative for testing hypersonic technologies via leap-ahead flight demonstrations." "We will share more news about the sale as it becomes available," Stratolaunch noted. Previously in the bankruptcy process, Virgin Orbit agreed to the terms of Stratolaunch's bid, which was to purchase the 747 jet "Cosmic Girl" and other aircraft assets. Stratolaunch has been developing its own airborne system, the world's largest airplane called "Roc," as a platform for hypersonic flight testing.

Launcher, a subsidiary of Vast Space, is purchasing the company's facility in Mojave, California -- as well as some machinery, equipment and inventory -- for $2.7 million. Virgin Orbit's Mojave leases include infrastructure such as rocket engine test stands and an aircraft hangar. A liquidation company, Inliper, is purchasing the company's office equipment for $650,000.

You could own a piece of space history

[Required Snark]

"A liquidation company, Inliper, is purchasing the company's office equipment for $650,000."

You might be able to get a office chair or a desk, or even a laptop!

Re:

[Rockoon]

..and own a piece of "space history" where a "piece" is that of a failed company that never managed more than 4 successful launches, only 2 of which produced revenue for the company (but still lost money)

Show how tough and random the rocket industry is

[JoshuaZ]

If I had been asked before VG's bankruptcy which would have gone under first, Virgin Orbit or Virgin Galactic, I would have guessed VG before VO. VO had a reasonable business model, and the use of an airplane as a 0.5 stage made a fair bit of sense. It didn't provide as much velocity as a true first stage, but it did give some, was reusable (being an airplane), and allowed them to launch from almost anywhere with a large runway. VG in contrast's entire business model is flying an extremely unsafe airplane that gets a few minutes of zero-G for a few minutes for wealthy people at a very low tempo. Given VG's safety record, I'm not sure I'd even take a free flight. But the rocket industry is really tough, and the small rocket industry is especially tough with a lot of competition now. Also, it seems that Branson is personally a lot more interested in VG than VO, and support of your eccentric billionaire obviously helps. Still, it is disappointing, what VO has been doing was so much more interesting, and really had a chance to make an impact, and not just an impact from a disintegrating plane on the desert floor.

Re:Show how tough and random the rocket industry i

[Tx]

Yeah, it's a real shame that they should fail so late in the game, after having got to the point of developing a working launcher and performing several successful launches. But with Rocket Lab charging half the price to put similar payloads in orbit, they were going to be chasing a small niche, and I guess it just became clear that there was no path to profitability. I see Rocket Lab bought VO's primary manufacturing site in the auction, kind of tells the story.

Re:

[careysub]

I would attribute it's failure in part to its heritage. The whole Virgin space development program was unimpressive - slow, poor quality control, poor technical decisions made (hence the fatalities), a bloated sluggish operation. Spin-offs tend to inherit their parent's traits initially.

VG is still in the game because the gltiz is still attracting investor money, not because their services are paying bills. VO just could not make a case to keep the investment flowing.

Causes

[necro81]

But difficulty raising funds, and slow execution, brought the once multibillion-dollar company to bankruptcy and ultimately shut down

I disagree. They managed six launches [wikipedia.org]: four successes and two failures. The most recent was one of those failures. Their operating model offered no cost benefit in the small-launch (i.e., cubesat) market compared to existing alternatives (e.g., RocketLab). And for all the business reputation Richard Branson has (deserved or not), he wasn't able to sign up many customers or queue up a promising launch manifest.

In short: they didn't have a compelling product, and so didn't have enough customers, so the business failed.

Re:

[careysub]

In short: they didn't have a compelling product, and so didn't have enough customers, so the business failed.

Good points. That was an underlying problem - the whole concept fails to provide technical advantages over ordinary rocketry.

industry ups and downs

[v1]

All things considered, we really do have quite a few private orbital companies in operation right now. I think in 2000 if you took a poll to see how many private space rocket companies we'd have in 2020, you' get answers in the 1-3 range. We really do have a great variety right now.

But that comes at a cost of spreading the customers thinner, meaning less business for each company, which makes it tougher for them to survive and grow. After the initial "start dash", it's necessary for the under-performers to drop out. It consolidates a lot of things, including customers, infrastructure, and talent, and strengthens the remaining companies. It's like pruning the limbs on a growing tree.

On one hand I think it's unfortunate to have a loss of variety in the market, but on the other hand, everyone else should be on more solid footing as a result, insuring the market as a whole is healthier and can accelerate their growth a little.

Re:

[necro81]

But that comes at a cost of spreading the customers thinner, meaning less business for each company, which makes it tougher for them to survive and grow

It's true that in a competitive market, there usually will be some companies that can't compete and die.

However, one thing to keep in mind is that, with the proliferation of new launch providers, the size of the customer base has also grown. To use an analogy: the pie may be getting cut into more pieces, but the pie is also getting larger, so it is pos

No wonder

[RUs1729]

Rocket technology will have to improve a heck of a lot before widespread space tourism becomes a thing. In fact, chances are that as long as this is the core technology for the endeavor space tourism will remain a privilege attainable by the very rich alone.

turns out

[groobly]

Turns out not all billionaires are created equal.

They faired better than most small sat launchers

[nucrash]

While they are shutting down, they did fair better than the bast many of small sat launchers and other rocket companies that never had a single successful launch. You can even say they managed to do better than some that are still going.
Astra is still on rocky ground due to losing so many launches. With two successes and five failures, Virgin Orbit has a far better record. The Rocket 4 is still a ways off to change
ABL just had their maiden flight this year, but was far from successful.
Relativity Space's Terran 1 shows promise, but they are moving on to a new rocket.
Firefly has had two launches, the second was orbital, but had enough problems that calling it a success is not agreed upon.
ARCA seems like vaporware
  There are a number of other companies who don't even seem like they are close to an actual flight and probably even more that have already folded.
Even though they are closing down, Virgin Orbit did manage to put their place in the history books as being one of the first air launched liquid fueled rockets. They did something innovative. Unfortunately that innovation wasn't enough to be profitable.