Virgin Galactic cleared by FAA to fly customers into space

Virgin Galactic Holdings Inc. received regulatory approval to fly customers into space, moving the budding industry founded by billionaires one step closer to reality. The shares surged.

The Federal Aviation Administration upgraded the company’s existing license to cover customer flights, Virgin Galactic said Friday in a statement, saying the approval was the first of its kind. The company also confirmed that a May 22 test flight performed well against objectives.

The approval marks another milestone for an industry that not long ago was the stuff of science fiction. Virgin Galactic, founded by entrepreneur Richard Branson, has been working toward its goal since 2004. Fellow billionaire Jeff Bezos plans his first trip in July, after auctioning a passenger seat for $28 million.

“A new chapter in the story of human spaceflight is beginning,” the FAA said in a statement on Virgin Galactic. The agency confirmed it had “approved the first commercial space license to launch private individuals into space.”

Virgin Galactic jumped 36.4% to $55.07 at 11:50 a.m. Pacific. As of Thursday, the company had a market value of $9.7 billion.

Data from the May test flight, Virgin Galactic’s first rocket burn in two years, confirmed that upgraded horizontal stabilizers and flight controls on the VSS Unity performed in line with predictions, Virgin Galactic said.

The suborbital, rocket-powered craft is carried from takeoff by a larger craft called VMS Eve, then released. In the May flight it achieved a speed of Mach 3 and reached space at an altitude of 55.5 miles.

The company said it would continue preparing for three remaining test flights.

Bloomberg writer Keith Laing contributed to this report.