XCOR Layoffs Primarily Impacted Lynx Team

Engine hot fire (Credit: XCOR)
Engine hot fire (Credit: XCOR)

An update on the XCOR layoffs….

The layoffs primarily affected the team working on the Lynx suborbital space plane. Some employees involved in the program remain. However, work on building the spacecraft has been suspended for the time being.

Engineers working on XCOR’s rocket engines have been retained. Their main work will involve an engine for United Launch Alliance’s ACES upper stage. Some work will continue on Lynx’s engine and control thrusters.

Sources are indicating that XCOR laid off about 25 employees on Friday, which they say was just under half of the company. The exact head count before the staff reductions is unclear. Sources say around 50; however, the Midland Reporter-Telegram reported in January that XCOR had 63 employees at the time.

Staff remain employed at XCOR’s main headquarters in Mojave, Calif., and at its hangar in Midland, Texas.

  • krf

    Apropos the previous XCOR layoff discussion, the article you linked interviewed a young XCOR engineer who relocated from Mojave to Midland. With the layoffs, if all in Mojave, the majority of staff would now be in Midland if I read things correctly.

    The XCOR website on the Company Overview page has had the following wording for a while; “We are currently in the process of expanding our corporate and R&D headquarters to Midland, Texas.”

    I think the term “main headquarters” is not going to apply to Mojave for much longer.

  • ThomasLMatula

    I hope they will be able to go forward again with the Lynx, it is one of the better ideas for reusable suborbital access.

  • Henry Vanderbilt

    My understanding is the Lynx team had a presence in both Mojave and Midland.

  • Sam Moore

    With this and VG’s apparent refocus to orbital work, are anybody other than Blue substantially working towards suborbital space tourism?

  • windbourne

    American billionaires are far too comfortable.

  • Douglas Messier

    XCOR will have to address what all this means publicly at some point in the next few days. Probably after the holiday weekend. They need to explain what’s happened to the folks in Midland if they haven’t already done so.

  • Aerospike

    Lynx used to be my personal favourite “underdog” in the suborbital space race.

    It really is a shame to see the team disbanded. :/

  • cdevboy

    I basically thought that when some of the Original group left to start a new company aimed at rapid design and prototyping that the Lynx was done for. They now seem to be living off the Piston powered fuel pump to replace normal turbo pumps that they have promised for ACES upper stage. I further assume that all of their other sources of support have dried up. The Lynx has been in development to long with out even a low altitude flying prototype or glider. Originally there was supposed to be 3 versions leading up to the full version. Since they had chosen to move to Midland, with its cost vs savings implications, financial conditions must have changed relatively quickly.

  • schooner1

    One would think that if this was planned in response to looming cash flow problems, XCOR would have had a press release ready to go as soon as the last person was laid off. Maybe a smaller company will be easier to manage? But it will not likely be a company that builds space planes. So who could pick up the worthwhile pieces of their technology?

  • Douglas Messier

    You would think so. Public relations has never been one of XCOR’s strong suits. Maybe we’ll see something tomorrow.

    They have a lot of audiences to explain this to — partners, customers, shareholders, investors, ticket holders, landlords, media. They need to clearly communicate what this means in an overall sense and specifically to each group.

  • Douglas Messier

    That is correct.

  • ThomasLMatula

    Yes, the good folks in Midland thought they were buying a sexy space tourist business, one that would add them to the list of places the rich and famous visit. But it appears that all they are getting will be a rocket engine builder that will only bring noise to the neighborhood. It also appears the taxpayer money they spent on being licensed as a spaceport was wasted. It will be interesting to see if it becomes an issue in the local elections.

    But this also leaves questions about the other organizations that were building business models on the Lynx, like Orbiter Outfitters and Citizens in Space. And the travel agents selling rides on it. It looks they they will be left out in the cold as well.

  • ThomasLMatula

    I think we may be right in assuming they were pushed out by the new investors, probably with a noncompetition clause that left consulting as their only near term option.

  • ThomasLMatula

    It may well be that Blue Origins ends up with the field to itself. If Spaceport America is smart they should be talking now to Jeff Bezos about moving operational flights there from his ranch.

  • Stu

    No one is going to touch these space tourism businesses going forward in terms of handing over actual money. They are going to need to produce a finished product before customers, booking agents, etc, get involved.

  • OldCodger

    Doesn’t seem to be many bean counters or pen pushers among the lay offs?

  • TimAndrews868

    Wasted! Oh, gosh my, no!

    Any town that invests in getting their airport rated as a spaceport is going to be rolling in money soon, because of all the space business it brings to town!!!!

  • ellegood

    Midland is supposed to be XCOR’s R&D center, while Cape Canaveral was planned as their location for manufacturing and operations. http://bit.ly/1TI8AN6

  • ThomasLMatula

    Actually they may well get away without discussing it at all.

    Laying workers off before a major holiday weekend is a classic way to slip under the media radar. Local news outlets that would normally cover it are too busy working on feature stories for the holiday to pay attention. And by the time the holiday is over its a new news cycle and its old news.

    Add to it there is no press release on the XCOR website (at least none I could find…) and they well be able to slip under the media radar with this news. I don’t see any stories in the local (Mojave or Midland) media and wouldn’t know about it except by Doug posting about it. I except that is true for the rest who read this that have no direct connect with XCOR.

    Thanks Doug for reporting it. Hopefully the local media will take notice and ask some questions. It would be especially interesting to see how the folks in Midland, especially the media, react to this news although now I am wondering if they are even aware of it.

  • ThomasLMatula

    I agree and that will reduce the odds of success. Looks like Blue Origins is the only hope now…

  • Qmustang16

    I would be interested to know why you think this?

  • schooner1

    Here’s a link to the 3:10pm story today in the Midland Reporter-Telegram:
    http://www.mrt.com/business/article_afe62402-276b-11e6-973d-6b6d14322ea8.html

    Vague info from XCOR, at best, but specific that they are focusing on the engine. Lynx is probably dead unless someone else picks it up.

  • duheagle

    As there were, and are, no billionaires involved in XCOR, I fail to see the relevance of this observation to the matter at hand.

  • duheagle

    I’m having bad flashbacks to Rocketplane-Kistler:

    1) New management crew arrives with lots of establishment credentials.
    Check.

    2) New management crew shows old management crew the door.
    Check.

    3) New management crew jettisons innovative part of company’s tech portfolio in favor of stuff that’s more conservative/has a higher TRL.
    Check.

    4) New management crew clears out everybody else associated with the abandoned initiatives.
    Check.

    5) New management presides over controlled descent into terrain.
    Stay tuned.

    I think one key metric for how likely Lynx is to ever fly is finding out if the pilot cadre has been among those RIFed. If they have, then – barring a whole-cloth buyout of the extant hardware and IP – I think Lynx is stillborn. Perhaps Doug can work his copious Mojave connections and find out if Brian Binnie, say, is still on the XCOR payroll?

  • windbourne

    in other nations, most billionaires are investing into their own nation’s businesses. In America, ours have mostly stopped.

  • Stu

    Hard so see how they can’t discuss it at all, given they have taken deposits from paying customers for a service they are (apparently) no longer working on. I would imagine they have to inform their customers and return deposits under those kind of circumstances.

  • ThomasLMatula

    I agree,but so far silence.

  • ThomasLMatula

    You forget about Elon Musk, Robert Bigelow, Jeff Bezos, Paul Allen, need I go on.

    So its not that billionaires are not investing in America, merely they decided not to invest in XCOR for some reason.

  • windbourne

    The shear number of American billionaires that invest into American businesses is small compared to what goes on in other nations. China? Billionaires work with their gov money to expand fast. Germany? All of their top billionaires are investing heavily into Germany.
    Same with Mexico, India, etc.

  • Stu

    Hopefully we might see an end to these insane taxpayer funded “spaceports” out of all this. Cart before horse.

  • ThomasLMatula

    Looks like Space News is finally reporting the layoffs.

    http://spacenews.com/xcor-lays-off-employees-to-focus-on-engine-development/

    XCOR lays off employees to focus on engine development
    by Jeff Foust
    May 31, 2016

  • HyperJ

    All your points make the assumption that the “old management” (and founders) weren’t already in a “controlled descent into terrain”.

    LYNX progress was … not progressing. For several years now, people near the project has teased the possibility of a completed LYNX doing roll test basically any month now. But every picture update showed precious little actual progress on the vehicle.

    So yes, the new management may not be doing so great. But neither was the old management, otherwise there would have been no need for new management.

  • patb2009

    The Accountants seem to make a lot of the termination decisions in companies.

  • HyperJ

    True, but there appears to be no evidence of this here (yet). So does “OldCodger” have a source for his assertion?

  • ThomasLMatula

    Both articles reference Doug’s original posts. I wonder if they would have covered this if Doug hadn’t highlighted it? Kudos again to Doug for great reporting!

  • duheagle

    You might well be right that Lynx was simply a bridge too far and/or that XCOR was going to auger in anyway. Both of those are certainly very defensible propositions. But I don’t think the solution was what the new management decided to do. Small companies run on spirit and buy-in much more than larger outfits do. The new management don’t know this because they’ve all been larger outfit guys their entire previous careers.

    Most of the Lynx crew having been laid off, I wonder how long it’s going to be before even the people doing engine work decide to shop their resumes around. I don’t think replacing the vision of being a pioneering suborbital space tourism and scientific research company with a “vision” of just becoming one of the least among the nameless rabble of crumb-chaser outfits looking to get a scrap or two from the primes now and then is going to have quite the same cachet. Human capital is more important to small outfits than financial capital. I don’t think the new guys get that. But I suspect that they will learn it, to their cost.

  • duheagle

    I don’t think that’s a supportable proposition. Even if were true, though, it is still irrelevant to the issue of XCOR’s current travails.

  • duheagle

    The top Mexican billionaire, Carlos Slim, bought himself a big piece of the New York Times not long ago for about a quarter billion bucks.

    Lakshmi Mittal, the 6th richest Indian man according to Forbes seems to invest mostly in moribund steel mills in Eastern and Western Europe and the U.S. He also owns mines in Kazakhstan. I referred to him as an “Indian man” rather than as a “man in India” because he’s not the latter. He lives in the U.K. He owns a palatial estate there widely known, these days, as the “Taj Mittal.”

    Sunil Mittal, the 8th richest man in India – and apparently no relation to Lakshmi Mittal – made his wad in telecom. His company, Bharti, is the largest wireless provider in India. He also owns telecom companies in other places including Africa. He bought a sizable wireless firm there for over $10 billion in 2010.

    I can probably keep this up all night. Do I have to?

    Billionaires are “citizens of the world,” dude. They invest wherever they think they can make a buck. If it’s the “home” country, fine. If not, also fine. I see no evidence that this pattern varies much by nationality. So I’m calling B.S. on your meme. By the way, I’m old enough to remember when the Left thought that being transnational was a good thing.

  • Kenneth_Brown

    Out with the new, In with the old. After the shake up last year I could see that the new iteration of the company was top heavy with corporate types even if they did have some industry experience.

    I was really looking forward to seeing the Lynx start testing this year. The engine development work for ULA is much less interesting even if it does bring in some revenue in the short term, does it add enough to the Xcor technology portfolio to build on? Can it bring in more customers for similar work or is the market place too small and after the ULA contract is complete, the company will have to reinvent itself once again to find more work?

    I wonder if contractual obligations are keeping the Midland facility open. It’s a desolate place seemingly built for oil industry needs and even further out than Mojave. I hear that it’s hard to get engineers to make the move to Mojave, so Midland would have to be even more of a challenge to attract and retain talent. Also, a company with 25ish staff is burning mondo travel money to keep two facilities open like this.

    I find SpaceX’s dispersement of facilities a waste of money as well. Granted, a test facility for rocket engines needs to be placed in the middle of nowhere, but it doesn’t have to be 1,000 miles from the main plant that is 2,400 miles from the primary launch facility. The Big Boys maintain plants in multiple locations to keep from concentrating military production in one place, but mostly to have a large presence in many congressional district across several states. The threat (expressed or implied) of one of these companies closing a facility will get the local representatives and senators to make sure some contracts are awarded to them to keep the plant open and voters employed.