While HOTOL's proof-of-concept design study was being carried out, attempts were made by both industry and the British government to establish international cooperation to develop, produce, and deploy the spacecraft. In spite of American interest in the programme, there was little appetite amongst the members of the European Space Agency (ESA), and the British government was not prepared to depart from ESA cooperation. Additionally, technical issues were encountered, and there were allegations that comparisons with alternative launch systems such as conventional rocket vehicle using similar construction techniques failed to show much advantage to HOTOL. In 1989, funding for the project ended. The termination of development work on HOTOL led to the formation of Reaction Engines Limited (REL) to develop and produce Skylon, a proposed spacecraft based on HOTOL technologies, including its air-breathing engine.