Faced with increasing competition from innovative firms like SpaceX, a Lockheed Martin Corp.-Boeing Co. joint venture that for years has dominated the U.S. military market is slated to layoff several hundred workers, according to news reports.
The planned reductions of as many as 875 jobs amount to a quarter of the workforce at United Launch Alliance LLC, the Centennial, Colorado-based company that supplies the U.S. Air Force with Atlas and Delta rockets to launch military and spy satellites into space.
That’s according to an article by Irene Klotz, a reporter for Reuters, who interviewed ULA’s chief executive officer, Tory Bruno, on Thursday at the annual Space Symposium conference in Colorado Springs, Colorado.
As Klotz reported:
ULA, a partnership of Lockheed Martin Corp and Boeing Co, expects a first round of 375 job cuts to be accomplished this year, mostly through voluntary layoffs. In an interview with Reuters, ULA CEO Tory Bruno said another 400 to 500 employees would be cut by the end of 2017.
“We’re in the process of transforming our company,” Bruno said.
Space Exploration Technologies Corp., known as SpaceX and headed by billionaire Elon Musk, is seeking to develop reusable rockets to lower launch costs. It made headlines last week when it successfully landed the first stage of its Falcon 9 rocket on a barge at sea. The company is developing manned spacecraft for NASA and plans to break into the military market by launching GPS satellites.
Under Bruno, ULA has announced plans to develop a lower cost rocket, called Vulcan, in part to end the company’s reliance on Russian engines. The the RD-180 propulsion system is made by NPO Energomash and used as a first-stage engine on the Atlas booster in the Air Force’s Evolved Expendable Launch Vehicle, or EELV, program.
The launch program is one of the Pentagon’s most expensive acquisition programs, estimated to cost a total of $62.4 billion for 161 booster cores, the main component of a rocket engine, according to recently released budget documents.
While the engine is relatively cheap and has contributed to the company’s long record of successful launches, it has become a flash point in the debate over American reliance on Russian technology for national-security programs, particularly amid tensions between the two countries over Russia’s military involvement in the Ukraine and Syria.