image copyrightVocopter
Photo caption, ‘Volo City’, a two-person flying taxi, was piloted in Paris this summer.Article related information
- Reporters Theo Leggett & Ben Morris
- Reporter, BBC Money & Work
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3 hours ago
At this year’s Paris Olympics, the innovative electric flying taxi service should have caught the eye.
Germany’s Volocopter promised that its two-person electric flying taxi, Volocity, would carry passengers around Paris, but this did not materialize. Instead, Volocopter only conducted demonstration flights.
Although it was embarrassing that the promised deadline was not met, there was actually a more serious problem behind it. Volocopter urgently needed new investment to continue operating.
Loan negotiations worth 100 million euros (about 147.2 billion won) with the government ended in failure last April.
According to a ‘Bloomberg’ report, negotiations are currently underway for Chinese automobile company Geely to acquire an 85% stake in Volocopter in return for supporting $95 million (about 132.5 billion won). This means that all of the company’s manufacturing processes may be moved to China.
Volocopter is one of dozens of companies around the world developing electric vertical takeoff and landing (EVTOL) aircraft. Volocopter’s products boast helicopter-like flexibility, but are characterized by no cost, noise, or exhaust gas emissions.
However, the enormous costs of obtaining regulatory approval and building manufacturing capabilities are causing some investors to withdraw.
image copyrightLilium
Photo caption, Lilium’s products boast a radical design. Among them, there are aircraft that can be tilted for vertical takeoff.
One of the most notable damage cases is the German startup Lilium. Lilium has developed EVTOL with a very radical design. It is equipped with 30 electric motors that can simultaneously adjust the angle for vertical takeoff and forward flight.
And this new concept aircraft received a lot of attention. According to Lilium, it has signed memorandums of understanding with several companies around the world to order 780 units.
Based on these expectations, we also started a demonstration by remotely controlling a scale model. And manufacturing of the first full-size aircraft had already begun and was scheduled to begin testing early next year.
Just last July, Lilium’s COO Sebastian Borrell, whom we met at the Farnborough Air Show in England, told the BBC in a confident voice, “That’s right. We are using the funds quickly. But this is a good sign. “It means that we are producing aircraft,” he said. “We plan to produce three aircraft by the end of the year, and we have raised 1.5 billion euros in investment.”
But funds ran out.
Lilium originally wanted to receive a loan of 100 million euros from KfW, a German development bank. This required guarantees from the German central and state governments, but it ended in failure.
Ultimately, Lilium’s main operating business entered bankruptcy proceedings early this month and was delisted from the NASDAQ stock exchange.
Currently, work is continuing to develop new aircraft by working with restructuring experts to sell business units or attract new investments, but it appears to be very difficult to produce electric aircraft.
image copyrightVertical Aerospace
Photo caption, Vertical Aerospace’s ‘VX4’, which recently completed a successful takeoff and landing test.
Meanwhile, the British company attracting the most attention in the EVTOL market is ‘Vertical Aerospace’. The Bristol-based company was founded in 2016 by entrepreneur Stephen Fitzpatrick, who is also the founder of OVO Energy.
Vertical Aerospace’s ‘VX4’ boasts a striking design. Lift is created using eight large propellers mounted on sleek aircraft-style wings. Fitzpatrick makes ambitious claims that the aircraft will be “100 times” safer and quieter than helicopters while costing only 20 percent.
And in fact, Vertical Aerospace is showing results. After completing testing through remote control, pilot flight testing began early this year. At first, tests were conducted with the fuselage fixed to the ground, but earlier this month, the aircraft successfully took off and landed without being tethered for the first time.
But there were also serious situations. In August last year, a remote control test prototype suffered severe damage when its propeller blade fell off and crashed during flight at Cotswold Airport.
Earlier in May, Rolls-Royce, one of the major partners, withdrew from a contract to supply electric motors for aircraft.
However, their aspirations are still sky high. Vertical Aerospace announced that it plans to deliver 150 aircraft to customers by 2030. In addition, it is expected that by then, it will be able to produce 200 units per year and achieve the break-even point.
But financial pressures are getting worse. Fitzpatrick invested an additional $25 million (approximately 34.8 billion won) in the company in March of this year. However, if another investor cannot be found, it will not be easy to resolve the $25 million that must be repaid within August.
As of September, Vertical Aerospace’s funding amount was $57.4 million (approximately KRW 80.1 billion), but it is expected to use close to twice that amount next year.
And the company’s future appears to depend on signing a contract with Jason Mudrick, an American financier who has become its main creditor through Mudrick Capital Management.
Mudrick proposed a $75 million investment and warned Vertical Aerospace’s board that if they rejected his plan, bankruptcy proceedings would be inevitable. However, Fitzpatrick, who would lose control of the company he founded, rebelled against this.
According to sources, the two sides are close to reaching an agreement. Vertical Aerospace believes that if the deal closes, more funding opportunities will open up.
image copyrightAirbus
Photo caption, ‘City Airbus’ has a flight distance of 80 km and can fly at 120 km per hour.
Meanwhile, Bjorn Perm explained that there are European projects that are cruising calmly despite this turbulence. Perm is an expert who majored in aeronautical engineering and has experience flying fighter jets in the Swedish Air Force, and currently works for the aerospace consulting company ‘Leeham’.
Perm predicted that the prospects for the EVTOL project being carried out by Airbus will be good.
This four-seater aircraft, called ‘City Airbus Next Gen’, is equipped with eight propellers and has a flight distance of 80 km.
“It’s a technology project for Airbus engineers,” Perm said, adding, “They have the money and the know-how.”
What about the situation in other parts of the world? There are also startups that have a good opportunity to lead to actual production based on solid funding. America’s Joby Airlines and Archer Airlines are good examples.
So what is the next task after the actual production of the aircraft begins? The question is whether there is a profitable market or not.
The first route to be operated will most likely be between the airport and the city center. But can it actually generate revenue?
Regarding this, Parm pointed out, “The biggest problem with operating costs is the pilot and the battery,” adding, “The battery needs to be replaced a couple of times a year.”
Considering all these uncertainties and costs, you might wonder why investors are interested in investing in these new electric aircraft in the first place.
“No one would want to miss out on a company that could become the next Tesla,” Parm responded with a laugh.
