Europe’s flying taxi goals falter as money runs brief | EUROtoday

One of the improvements at this yr’s Paris Olympics was alleged to be an electrical flying taxi service.

Germany’s Volocopter promised its electric-powered, two-seater plane, the VoloCity, can be ferrying passengers across the metropolis.

It by no means occurred. Instead the corporate ran demonstration flights.

While lacking that deadline was embarrassing, behind the scenes a extra severe situation was taking part in out – Volocopter was urgently attempting to lift recent funding to maintain the agency going.

Talks to borrow €100m (£83m; $106m) from the federal government failed in April.

Now hopes are pinned on China’s Geely, which is in talks to take an 85% stake in Volocopter in return for $95m of funding, in keeping with a Bloomberg report. The deal might imply that any future manufacturing can be moved to China.

Volocopter is one in every of dozens of firms all over the world creating an electrical vertical take-off and touchdown (EVTOL) plane.

Their machines promise the flexibleness of a helicopter, however with out the associated fee, noise and emissions.

However, confronted with the huge value of getting such novel plane authorized by regulators after which increase manufacturing capabilities, some traders are bailing out.

One of probably the most high-profile casualties is Lilium.

The German firm had developed a radical tackle the EVTOL theme.

Lilium’s plane makes use of 30 electrical jets that may be tilted in unison to swing between vertical elevate and ahead flight.

The idea proved engaging, with the corporate claiming to have orders and memoranda of understanding for 780 jets from all over the world.

It was in a position to display the know-how utilizing a distant managed scale mannequin. Construction had begun on the primary full-sized jets, and testing had been because of start in early 2025.

As lately because the Farnborough Airshow in July, Lilium’s COO Sebastian Borel was sounding assured.

“We are definitely burning through cash,” he told the BBC. “But this is a good sign, because it means we are producing the aircraft. We’re going to have three aircraft in production by the end of the year, and we have also raised €1.5bn”.

But then the money ran out.

Lilium had been attempting to arrange a loan worth €100m from the German development bank, KfW. However, that required guarantees from national and state governments, which never materialised.

In early November, the company put its main operating businesses into insolvency proceedings, and its shares were removed from the Nasdaq stock exchange.

For the moment, work on the new aircraft is continuing, as the company works with restructuring experts to sell the business or bring in new investment. However, getting the new e-jet into production is looking more challenging than ever.

The high-profile British player in the eVTOL market is Vertical Aerospace. The Bristol-based company was founded in 2016 by businessman Stephen Fitzpatrick, who also set up OVO Energy.

Its striking VX4 design uses eight large propellers mounted on slim, aircraft style wings to generate lift. Mr Fitzpatrick has made ambitious claims about the aircraft, suggesting it would be “100 times” safer and quieter than a helicopter, for 20% of the cost.

The company has made progress. After completing a programme of remote-controlled testing, it began carrying out piloted tests earlier this year. Initially, these were carried out with the aircraft tethered to the ground. In early November, it carried out its first untethered take-off and landing.

But there have also been serious setbacks. In August last year, a remotely-piloted prototype was badly damaged when it crashed during testing at Cotswold Airport, after a propeller blade fell off.

In May one of its key partners, the engineering giant Rolls Royce pulled out of a deal to supply electric motors for the aircraft.

Ambitions remain sky high. Vertical Aerospace says it will deliver 150 aircraft to its customers by the end of the decade. By then, it also expects to be capable of producing 200 units a year, and to be breaking even in cash terms.

Yet financial strains have been intensifying. Mr Fitzpatrick invested an extra $25m into the company in March. But a further $25m, due in August if alternative investment could not be found, has not been paid. As of September, Vertical had $57.4m on hand – but it expects to burn through nearly double that over the coming year.

Hopes for the future appear to be pinned on doing a deal with the American financier Jason Mudrick, who is already a major creditor through his firm Mudrick Capital Management.

He has offered to invest $75m into the business – and has warned the board of Vertical that rejecting his plan would inevitably lead to insolvency proceedings. But the move has been resisted by Mr Fitzpatrick, who would lose control of the company he founded.

Sources close to the talks insist an agreement is now very close. The company believes if a deal can be done, it will unlock further fundraising opportunities.

Amid the turbulence, one European project is quietly on track, says Bjorn Fehrm who has a background in aeronautical engineering and piloted combat jets for the Swedish Air Force. He now works for aerospace consultancy Leeham.

He says that the EVTOL project underway at Airbus is likely to survive.

Called the CityAirbus NextGen, the four-seater aircraft has eight propellers and a range of 80km.

“This is a know-how mission for his or her engineers, and so they’ve obtained the cash, and so they’ve obtained the know the way,” says Mr Fehrm.

Elsewhere in the world, other well funded start-ups stand a good change of getting their aircraft into production. That would include Joby and Archer in the US.

Once the aircraft are being produced, the next challenge will be to see if there’s a profitable market for them.

The first routes are likely to be between airports and city centres. But will they make money?

“The greatest downside space in terms of the price of operation is the pilot and the batteries. You want to alter the batteries a few instances per yr,” points out Mr Fehrm.

Given all the uncertainty and expense, you might wonder why investors put money into new electric aircraft in the first place.

“No one wished to overlook out on the subsequent Tesla,” laughs Mr Fehrm.