NASA on Friday began the first wave of layoffs that will ultimately eliminate 900 jobs by September as the space agency resumes plans to retire its space shuttle fleet next year.

The space agency issued 160 layoff notices today for manufacturing jobs that are no longer required to support the last eight missions slated to launch between now and the December 2010 deadline to mothball NASA's three aging space shuttles.

"This is the first significant loss of manufacturing capability," John Shannon, NASA's shuttle program manager, told reporters late Thursday.

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The layoffs are primarily focused in Utah and New Orleans, where contractors build the twin solid rocket boosters and 15-story external tanks that help boost NASA shuttles into space.

They came one day after the expiration of a temporary hold enacted by Congress to delay the shuttle program shutdown until April 30 so President Barack Obama's administration had time to weigh in.

Now that the deadline has passed, NASA will resume shutting down shuttle manufacturing operations that are no longer needed for the remaining flights.

NASA plans to launch the space shuttle Atlantis on May 11 to perform one final service call on the Hubble Space Telescope. Seven other missions are scheduled to complete construction of the International Space Station.

Last month, President Obama released a budget outline that could allow one extra flight to the space station to deliver a billion-dollar experiment — the Alpha Magnetic Spectrometer — but only if the mission would fit within NASA's 2010 retirement plan.

"I love the shuttle. I have spent my career working on the shuttle," Shannon said. "At some time you have to decide that what the shuttle was meant to do has been done. And I would say that it has."

The space shuttle is the only reusable spacecraft capable of launching astronauts on space service calls like the Hubble repair mission or carrying massive construction pieces to the International Space Station.

Not all of the 900 eliminated shuttle positions are layoffs, Shannon said. Some include attrition as employees leave the workforce, while others include reassignment to other projects, such as NASA's Constellation program that is building its space shuttle successor.

NASA will shift the funding saved from the shuttle's retirement over to the development of that new spaceship — the Orion Crew Exploration Vehicle — which is expected to make its operational debut no earlier than March 2015.

Orion is a capsule-based spacecraft that builds on the legacy of NASA's Apollo-era vehicles. The new vehicle will be launched on a shuttle-derived Ares I rocket to ferry new crews to the International Space Station. It is also slated to return astronauts to the moon by 2020.

Orion was initially slated to come in two versions: a six-seater for space station crew flights, and a four-seater for moon missions.

NASA confirmed this week that it is focusing on the four-person Orion for now, which should save time, money and keep the spacecraft on track for a 2015 target.

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