It looks like SpaceX has hit some turbulence.
In a companywide letter obtained by CNBC and Space Explored, SpaceX CEO and founder Elon Musk says the company faces bankruptcy over what he calls a “crisis” with the Starship Raptor engine production.
“Unfortunately, the Raptor production crisis is much worse than it had seemed a few weeks ago,” reads the email, according to Space Explored. “As we have dug into the issues following the exiting of prior senior management, they have unfortunately turned out to be far more severe than was reported. There is no way to sugarcoat this.
“I was going to take this weekend off, as my first weekend off in a long time, but instead, I will be on the Raptor line all night and through the weekend.”
Musk then tells employees to be prepared to work.
“Unless you have critical family matters or cannot physically return to Hawthorne, we will need all hands on deck to recover from what is, quite frankly, a disaster.
“In addition, we are spooling up terminal production to several million units per year, which will consume massive capital, assuming that satellite V2 will be on orbit to handle the bandwidth demand. These terminals will be useless otherwise.”
Starlink is SpaceX’s project designed to beam the internet to remote locations around the world via a network of orbiting satellites.
In closing, the billionaire CEO of Tesla said, “What it comes down to, is that we face a genuine risk of bankruptcy if we can’t achieve a Starship flight rate of at least once every two weeks next year.”
SpaceX has not responded to requests for comment.
In 2020, Musk abruptly announced on Twitter he was moving Tesla’s headquarters from California to Texas—a state with no income tax. Bloomberg reported this week that Musk stands to save $2 billion in taxes as a result of the move.
Back in October, SpaceX was said to be doing fine—described as one of the world’s most valuable private companies. Shares in SpaceX are not publicly traded. As SpaceX sought to raise funds to finance Starship and Starlink, its valuation was reportedly more than $100 billion. Much of the valuation resulted from the sale of secondary shares valued at around $560 per share, up 33 percent since February, according to CNBC.
Starship Testing Resulted in Multiple Explosions
The Raptor engine will power SpaceX’s Starship and is expected to send the spacecraft to the surface of Mars. Test flights of Starship began in July 2019 at SpaceX’s launch facility in Boca Chica, Texas.
Unfortunately for Musk, the Starship project has already seen multiple explosions during testing. Its eleventh test, SN11, exploded during its landing approach earlier this year.
SpaceX’s financial woes are preceded by local damnation of some Boca Chica residents who oppose the expansion of its launch site in the Rio Grande Valley. Two online FAA hearings were held regarding SpaceX’s expansion proposal, where people from around the country shared their support, or opposition, to the Draft Programmatic Environmental Assessment.
The expansion would serve as the building blocks for Starship’s eventual trip to Mars. According to SpaceX, the spacecraft will house a completely reusable transportation system for crew and cargo.
SpaceX claims Starship will be the world’s most powerful launch vehicle ever developed, capable of carrying over 100 metric tonnes into Earth’s orbit.
