On Thursday senior Boeing officials leading the Space Launch System program, including David Dutcher and Steve Snell, convened an all-hands meeting for the more than 1,000 employees who work on the rocket.

According to two people familiar with the meeting, the officials announced that there would be a significant number of layoffs and reassignments of people working on the program. They offered a handful of reasons for the cuts, including the fact that timelines for NASA's Artemis lunar missions that will use the SLS rocket are slipping to the right.

Later on Thursday, in a statement provided to Ars, a Boeing spokesperson confirmed the cuts: "Due to external factors unrelated to our program performance, Boeing is reviewing and adjusting current staffing levels on the Space Launch System program."

Better late than never?

For nearly a decade and a half, Boeing has led development of the core stage of the massive SLS rocket that NASA intends to use to launch the Orion spacecraft for its crewed Moon missions.

The contract has been lucrative for Boeing and subject to considerable criticism over the years for its largesse, as NASA has spent tens of billions of dollars developing a rocket that reuses Space Shuttle main engines and other elements. Also, the rocket was originally supposed to make its debut in late 2016 or 2017 but did not actually fly for the first time until November 2022. And NASA's inspector general has characterized Boeing's management of the SLS rocket program at times as "poor."

However, when the SLS rocket made its debut a year and a half ago, it performed exceptionally well in lofting an uncrewed Orion spacecraft toward the Moon. After that mission NASA declared the rocket to be "operational," and Boeing moved into production of the vehicle for future missions that will carry astronauts to the Moon.

So in some sense, these cuts were inevitable. Boeing required a lot of resources to design, develop, test, and write software for the rocket. Now that the development phase is over, it is natural that the company would be scaling down development activities for the core stage.

The Boeing statement did not say so, but sources told Ars that the cuts may eventually amount to hundreds of employees. They will be spread across the company's rocket facilities in Alabama, Louisiana, and Florida, primarily. The cuts will hit both the core stage program as well as the Exploration Upper Stage program, a new upper stage for the rocket that is also beginning to move from development into production.

Waiting on other elements

When Boeing cites "external factors," it is referring to the slipping timelines for NASA's Artemis Program. In January officials with the space agency announced approximately one-year delays for both the Artemis II mission, a crewed lunar flyby, to September 2025; and Artemis III, a lunar landing, to September 2026. Neither of these schedules are set in stone, either. Further delays are possible for Artemis II, and likely for Artemis III if NASA sticks to the current mission plans.

Although the SLS rocket will be ready for the current schedule, barring a catastrophe, the other elements are in doubt. For Artemis II, NASA still has not cleared a heat shield issue with the Orion spacecraft. That must be resolved before the mission gets a green light to proceed next year.

The challenges are even greater for Artemis III. For that mission NASA needs to have a lunar lander—which is being provided by SpaceX with its Starship vehicle—in addition to spacesuits provided by Axiom Space for the lunar surface. Both of these elements remain solidly in the development phase.

Additionally, NASA is grappling with budget challenges. For the first time in more than a decade, the agency is facing budget cuts. This week the space agency's administrator, Bill Nelson, told Congress, "With less money, we have to make some very tough choices." Among these could be seeking to use future SLS funding to shore up other elements of Artemis.

One of the people familiar with Boeing's internal meeting on Thursday said the space agency had come to the company earlier this year and said, in effect, that Boeing would receive less funding as SLS development wound down. The company was given the choice to "stretch" the funding it would receive or pause for a year due to the delays in the Artemis mission. Boeing chose to stretch the funds, and that was a driver of the cuts this week.

It would be easy, but unfair, to blame SpaceX and Axiom for the delays to future Artemis missions. Congress created the SLS rocket with an authorization bill back in 2010, but Boeing actually had been receiving funding for related work dating back to 2007. By contrast, NASA did not start funding work on the Starship lunar lander until late 2021, and the Axiom spacesuits until 2022. In some sense, these developments are as technically demanding as the SLS rocket work, if not more so.