Even an insignificant news can surge forward of Virgin Galactic’s shares. For example on January 2020 shares gained 20% after moving suborbital plane SpaceShip VSS Unity from production plant in California to Virgin Galactic’s airfield Spaceport America in New Mexico. But how about long term outlook? It is not as simple as it seems.
Investors satisfy a hunger for investments in fast grooving space industry with help of Virgin Galactic. But the most high-potential space technologies like SpaceX still private. So, the first thing is to understand that Virgin Galactic isn’t about space travel. The company today has only one suborbital plane SpaceShip VSS Unity. It named as SpaceShip but it can fly only to the height about 100 km – below a lower border of space. For example ISS is flying on 400 km above Earth’s surface. Spaceport America also doesn’t have expensive space stuff like launch pads and machinery for rocket fueling. It is only airport for planes and isn’t a big-ticket asset.
How about suborbital tourist flights? This is going to be the main product of Virgin Galactic. Today about 600 people is ready to pay $250,000 for several minutes of the microgravity. Such business could be highly profitable. But the following shall be observed: consumer experience and accident risk.
Virgin Galactic’s suborbital plane climbs on 15,000 metres as an underslung load of huge and slow subsonic plane. This long flight could be boring for passengers. Then SpaceShip will accelerate by rocket engine near vertical trajectory. The acceleration rate will reach 3,5 G, that twice much as it is at an usual plane during takeoff. It will be short period but such acceleration rate is able to do injury for untrained people.
An atmospheric reentry is the most dangerous part of the flight. SpaceShip decelerates by special wings under a heavy load. At a height of 15,000 meters wings must be turned to their normal configuration. It is very important to do this in right moment. In 2014 experienced pilots did mistake and SpaceShipTwo fell into pieces, one pilot died. It should be noted that a respiration is not possible on the hight above 15,000 meters. SpaceShip’s passengers haven’t pressure suits; they will have only Under Armour’s suits that look like yoga pants.
As plain as the day only one catastrophe could put the kibosh on Virgin Galactic’s business.
Overall, investors must be considered and appreciate these risks.