NASA space shuttle contractor United Space Alliance (USA) said March 5 that Richard Covey will step down as president and chief executive officer before the next scheduled shuttle launch.

Covey’s resignation takes effect March 26. The Space Shuttle Discovery is due to launch 10 days later, on April 5, on the first of four shuttle missions remaining before the orbiter fleet is scheduled to be retired from service. USA Chief Operating Officer Daniel Brandenstein will serve as acting CEO until Covey’s successor is named.

USA spokesman Jeffrey Carr, who also steps down March 26, said Covey began discussing his retirement last year with Boeing and Lockheed Martin, which formed USA in 1995 as a joint venture in response to NASA’s plans to consolidate numerous shuttle contracts into one prime contract.

“Covey wanted to announce it a lot sooner,” Carr said. “We were just holding off to make sure we had all our ducks in the row with the member companies.”

Carr said Covey’s departure would allow USA’s parent companies to put a CEO in place who will lead the company through the end of the shuttle program to whatever opportunities lie beyond.

Many of USA’s 8,700 employees had been planning to find new jobs supporting Ares 1 and Orion launch operations at NASA’s Kennedy Space Center in Florida. But with the Constellation program slated for cancellation as part of NASA’s 2011 budget proposal, the job outlook for USA’s work force is more uncertain than ever.

“There’s no question … it was a blow to morale to lose Constellation,” Carr said. “Not everybody was going to have the opportunity to transition to Constellation, but some were.”

Covey, a former astronaut, joined USA in 2006 after co-chairing an independent task force overseeing NASA’s effort to return the shuttle to flight after the 2003 Columbia accident.

NASA spokesman Michael Curie said that Covey is leaving USA “in good hands.”