Results for: lilium

Another giant in aerial mobility has gone public this week; Lilium has announced that it has completed its business combination with Qell Acquisition Corp, a publicly listed special purpose acquisition company (SPAC). The transaction was approved by Qell’s shareholders on September 10, 2021, during a Special Meeting in which more than 98% of the votes cast were in favor of the business combination. As of September 15, 2021, Lilium’s Class A ordinary shares and redeemable warrants will trade on the Nasdaq under the symbols “LILM” and “LILMW”, respectively.

“In 2015 with the clear vision that the decarbonization of aviation is inevitable, we set out to build a team and product that would radically transform the way the world moves. Six years and five generations of technology demonstrator aircraft later, we’re closer than ever to this goal. Today’s milestone will bring us even closer to launching our service in 2024 and making sustainable, high-speed regional air travel a reality to communities around the world,” said Daniel Wiegand, Co-Founder and CEO of Lilium.

As a result of the business combination, Lilium will receive approximately $584 million of gross proceeds, prior to transaction expenses, including from funds managed by leading strategic and long-term financial investors including Atomico, Baillie Gifford, LGT and its affiliate impact investing platform Lightrock, funds and accounts managed by BlackRock, Tencent, Ferrovial, Palantir, Honeywell, FII Institute and private funds affiliated with PIMCO. Net cash from the transaction will be used to fund the commercial launch of Lilium’s 7-Seater Jet. Lilium’s existing shareholders will roll 100% of their shares into the combined company.

“We see Lilium as a once-in-a-lifetime opportunity that will be at the forefront of a whole new industry. Lilium has the capacity to revolutionize regional travel, saving people hours so they can quickly travel from city to city. Using its 7-Seater Lilium Jet, Lilium’s regional shuttle service should enable sustainable, high-speed transportation. Qell is proud to bring this exciting company to the public markets,” said Barry Engle, CEO and Co-Founder of Qell.

Why it matters: With this SPAC acquisition, Lilium has positioned itself on the public market and adds to its leadership the likes of Thomas Enders and David Neeleman. Lilium has over 700 employees across Europe and is making continual progress towards EASA certification and entry into commercial service.

Source: Lilium Press Release

The agreement between Lilium and Azul, a major Brazilian airline, includes pre-orders for 220 of Lilium’s eVTOL jets. Together, the two companies will build an exclusive eVTOL network in Brazil, with a service launch planned for 2025.

Rendering of Lilium’s 7-seater jet in the skies above Rio De Janeiro.

More than just a purchase of aircraft, this agreement represents a strategic alliance between Azul and Lilium to fully build out an eVTOL transportation network in Brazil. Together, the two companies will build a co-branded transportation system, which will provide efficient, eco-friendly, and cost-effective air travel to the 100 million air passengers that travel within the country yearly. Although the Lilium Jet was developed in Germany, the company’s goal has always been to provide its highly innovative air transportation all parts of the world. Currently, Brazil’s market represents one of the world’s largest for civilian air transport and helicopter transport, which Lilium and Azul hope to augment and possibly eventually completely replace with Lilium’s all-electric vertical aircraft.

Accroding to a recent press release from Lilium, Azul would expect to operate and maintain the Lilium Jet fleet, while Lilium would provide an aircraft health monitoring platform, replacement batteries and other custom spare parts. Azul also expects to support Lilium with the necessary regulatory approval processes in Brazil for certification of the Lilium Jet and any other required regulatory approvals.

The 7-seater Lilium Jet can cruise at speeds of 175 mph, with a range of up to 155 miles. Unlike any other eVTOL concept, the aircraft uses 36 rotating miniature jet engines, that allow to take off vertically and travel on a fixed wing in forward flight. A full-scale prototype of the aircraft has already been built and flight tested. Watch a tour of the aircraft’s interior below:

Said Daniel Wiegand, Co-Founder and CEO of Lilium: “Azul has brought convenient and affordable air travel to underserved markets across the Americas and this makes them an ideal partner for Lilium. We’re excited to work with Azul’s seasoned team to deploy a co-branded eVTOL network in Brazil.”

Said John Rodgerson, CEO of Azul, “Azul is the largest domestic airline in Brazil in terms of cities served and daily departures. Our brand presence, our unique route network, and our powerful loyalty program give us the tools to create the markets and demand for the Lilium Jet network in Brazil. Since Azul’s founding 13 years ago, the Brazilian aviation market has doubled with Azul capturing almost 60% of the growth. We know how to create and grow new markets, and once again we see huge market opportunity by bringing the Lilium Jet to Brazil”

Why it’s important: With Lilium already making partnerships to enter markets within the U.S and Europe, and other eVTOL companies making deals with large airlines such as Virgin and United Airlines, this announcement from Lilium enters it onto the stage for partnerships and integrations for regional air travel with the world’s largest airlines. As eVTOL companies evolve, we will likely expect to see a combination of major airline partnerships with eVTOL companies making their own networks, which together will begin to form the overall eVTOL global ecosystem within different countries and cities.

Source // Lilium

Related:

• United Airlines Orders $1B in Archer Vehicles
• Virgin Atlantic, Brazil’s Azul Airlines Lay out plans for eVTOL Aircraft Purchases
• BLADE Announces Deal for Operator’s Order of up to 20 BETA EVA’s

Lilium has engaged with Honeywell, a world-leading manufacturer of electronics, engines, and mechanical systems for aircraft, to develop the 7-Seater Lilium eVTOL Jet’s avionics and flight control systems. Honeywell’s Compact Fly-by-Wire System will act as the flight control system on the all-electric 7-Seater Lilium Jet, responsible for controlling its moveable parts, including the 36 control surfaces and ducted fans that provide its high levels of maneuverability in every stage of flight.

Credit // Lilium

Honeywell, one of the first major aerospace manufacturers to create a dedicated Urban Air Mobility business unit, has designed a flight control system that draws on its decades of experience providing such systems for commercial airliners. This system, which has been tailored for the Lilium Jet’s unique design, will play a crucial role in ensuring smooth, comfortable, and emission-free air travel for passengers.

Yves Yemsi, Chief Program Officer at Lilium highlights that “Honeywell will integrate an advanced flight deck tailored for Lilium Jet as the central interface to the pilot with a vehicle management computer and a high integrity flight controls computing platform to provide a state-of-the-art Fly-By-Wire solution for the Lilium Jet.”

Alongside the flight control system, Honeywell is delivering the next generation of integrated avionics systems, which will provide a simplified user interface for the pilot to fly the Lilium Jet. The selection of Honeywell’s next-generation UAM avionics system is the result of ongoing collaboration between Lilium and Honeywell to converge on the specific technical requirements suitable for the Lilium Jet. The avionics system is designed to reduce training time and will support operation by a single pilot, freeing up greater passenger capacity.

“At Honeywell, we believe in the promise of the Urban Air Mobility segment and we see the enormous potential it has to bring about a new age of aviation and forever transform the way we think about flight and transportation,” said Stéphane Fymat, vice president and general manager of Urban Air Mobility, Honeywell. “Lilium shares that vision with us, which has enabled us to forge a fantastic relationship. We’re extremely excited for our avionics to be on board the Lilium Jet, where they will help ensure not only safe operation, but also make it easier for pilots to fly and provide a more comfortable journey for those onboard.”

In addition to its selection as a provider of the flight control system for the 7-Seater Lilium Jet, Honeywell is also participating in the common stock PIPE offering in connection with Lilium’s SPAC transaction, and is providing similar systems to Pipistrel, Vertical Aerospace, and Volocopter.

Following Toray Industries, Aciturri, and Lufthansa Aviation Training, Honeywell is the latest in a series of world-class Lilium suppliers whose technology and services have been certified in aerospace around the world for decades. They are joined by infrastructure leaders, such as the Tavistock Development Company, and Ferrovial, a leading airport operator, who have provided approximately $200 million in commitments to support the development of up to 14 eVTOL ertiports in Florida.

Why it’s important: As stated by Yemsi, “the avionics and flight control computers from Honeywell will be a key element for the Lilium Jet’s electronic architecture.” Honeywell has a decades-long track record of developing and certifying avionics and safety systems for leading aerospace companies, and is quickly becoming a leader in eVTOL aerial mobility technology by providing these advanced systems to many rapidly evolving top aerial mobility companies.

After recently unveiling its 7-seater eVTOL jet, Lilium has made news again by selecting Munich and Nuremberg to host the company’s initial air taxi hubs.

Discussions for air taxi infrastructure have been in the making for several years. Companies like Volocopter have already been laying down this groundwork in Singapore and Frankfurt, while EHang has started setting up several hubs in China and even begun tourism operations.

Rendering of a Lilium air taxi hub integrated with a German airport

Lilium has begun discussions for an air taxi hub in Florida in the U.S, but also has its attention strongly on European plans. The company hopes to establish its main aerial mobility network in Europe, starting by partnering with existing airports in Munich and Nuremberg. On April 19th, a press release by the company stated that the two hubs in Munich and Nuremberg will enable it to offer air connections between different locations across all of southern Germany.

Said Daniel Wiegand, Lilium’s CEO: “We are doing everything we can to bring our all-electric and ultra-quiet airline service to our home base of Bavaria, as well as to link Munich and Nuremberg even more closely with neighbouring cities and regions. We also want to offer a service for everyone in the Southern German region, with attractive prices and great time savings for all travellers. Munich and Nuremberg airports are key mobility hubs that we will connect with large and small cities throughout the region over time.”

The company’s ultimate goal is to establish aerial mobility networks in highly trafficked cities throughout the globe. In order to do, it has also partnered with Spanish infrastructure company Ferrovial to build at least 10 vertiports in Florida and abroad.

Why it’s important: Lilium is fast becoming one of the world’s leading developers of both innovative eVTOL aircraft and the infrastructure that they will require. Joining companies like Volocopter, Joby Aviation, and EHang, Lilium is slowly transitioning its attention from aircraft development to roll-out plans, signaling the quickening growth and forward progress of the air taxi industry.

Lilium has officially announced its intention to list on Nasdaq through a merger with Qell Acquisition Corp., a transaction that values the combined company at approximately $3.3 billion pro forma equity value at the $10.00 per share PIPE price. Simultaneously, the company revealed the development of its 7-Seater electric vertical take-off and landing jet, which employs proprietary Ducted Electric Vectored Thrust (“DEVT”) technology, and is projected to deliver the best unit economics, with market-leading capacity, low noise and high performance.

Lilium’s vision is to create a sustainable and accessible mode of high-speed, regional transportation. The Munich-based company is building a transport network and service for people and goods around its 7-Seater Lilium Jet, an electric vertical take-off and landing jet, which offers impressive capacity, low noise, and high performance. The 7-Seater Jet has a projected cruise speed of 175 mph at 10,000 feet and a range of 155+ miles, including reserves. It is the culmination of five years of technology development across four generations of technology demonstrators, including Lilium’s full-scale 5-Seater. Furthermore, Lilium received CRI-A01 certification basis from EASA for the vehicle in 2020.

Qell Acquisition Corp. (“Qell”) is a publicly listed special purpose acquisition company, or SPAC, and is focused on developing next-generation, sustainable mobility under the leadership of Barry Engle, a former president of General Motors North America. Upon closing of the transaction, the company will be called Lilium, and it is anticipated that ordinary shares will be listed on the Nasdaq under the ticker symbol LILM.

The combined company is expected to receive approximately $830 million of gross proceeds from a fully committed common stock PIPE offering of $450 million, along with approximately $380 million cash held in trust, assuming minimal redemptions of Qell’s existing public stockholders.

To date, Lilium has secured approximately $200 million of commitments from infrastructure partners, including Ferrovial and Tavistock Development Company. Up to 14 vertiports are already planned in Florida. Lilium is also in advanced discussions with key infrastructure partners for 10 vertiports to build a network across Europe.

Related: Lilium to Announce Air Taxi Hub Coming to South Florida this Spring

Why it’s important: This announcement marks a significant milestone for Lilium, as the proceeds from the merger and public offering will be directed toward serial production and commercialization of the 7-seater Jet. Working in partnership with world-leading aerospace, technology and infrastructure partners, commercial operations are planned to launch in 2024. Notably, Lilium is betting on a vertical integration approach to invent urban air mobility, an approach that Dean Donovan calls “risky” in a recent editorial first published via Forbes.

Source // Lilium press release

German eVTOL manufacturer Lilium is reportedly in talks with Qell Special Acquisition Corporation, according to persons involved closely to the matter. Closure of a potential deal that values Lilium at over $2 billion would be another instantiation in a series of announcements including BLADE UAM’s deal with EXPC, Archer (ACIC), and Joby (RTP), all assuming SPAC mergers in order to maximize available capital while massively cutting the risk involved.

While discussions are underway, there is no firm indication of deal proceedings advancing at this time, and if terms do not finalize the discussion could terminate with Lilium being approached by any other number of SPACs poised to make entry into the aerial mobility market.

TransportUP previously reported in February of 2021 on Lilium’s proposed Floridian operations network, an aerial mobility network that would be the result of a joint collaboration between Lilium and Ferrovial SA (construction counterpart) that includes design and build of 10 vertiports.

Qell is led by Barry Engle, a former GM executive. According to SEC filings, the SPAC raised $350 million in a September IPO. The fund stated that investment targets would include next-generation mobility, sustainable industrial technology, and enabling technologies that support development.

Another firm that is unspoken for within the eVTOL space currently is that of New Vista Acquisition Corp (NVSAU), which IPO’ed on February 17th with a $240 million raise slated for investment in the same fields as Qell, with the addition of artificial intelligence and other enabling technologies. Any proposed eVTOL acquisition target of New Vista would be pure speculation at this point, but companies like Lilium would fit the defined scope of the SPAC’s investment strategy. NVSAU Board Member Kirsten Bartouk Touw reported to evtol.com that the focus of the SPAC spans a wider scope than strictly eVTOL manufacturers, and includes companies that are ready to go public.

Why it’s important: 2021 has been a banner year for investment in aerial mobility. Billions of dollars of investment have poured into the industry over the past three months, and additional funds, SPACs, and private investors alike are poised to take advantage of the potential long-term growth and value propositions of aerial mobility as they stake financial commitments toward the industry which still carries a respectable quantity of risk. As further deals close, expect leaders among aerial mobility to more firmly cement their standing among the ranks of other eVTOL companies as they benefit from the increased amount of resources and financing.

This article, written by Dean Donovan, was originally published on Forbes. Shared on TransportUP with permission.

It’s official: Joby Aviation is buying Uber Elevate. The electric air taxi developer will integrate the Uber Elevate team into its core operation; Uber and Joby will expand their partnership to provide a seamless multi-modal experience and share data on how to provide the right services to customers; and Uber will invest $75 million into Joby, which is on top of its previously undisclosed $50 million investment in Joby’s Series C financing round in January 2020.

This move should support Joby’s strategy of both building a new type of electric aircraft almost entirely in-house as well as operating an airline. Elevate should also give Joby unparalleled competitive and ecosystem intelligence into some of its competitors given that Elevate had engaged Hyundai, Pipistrel, Jaunt Air Mobility, Bell, Signature Flight Support and Chargepoint, among others, as partners in the aerial ride-sharing network that Uber had planned on building. Most industry observers believe that Uber Elevate has built a high-quality group that provides access to arguably the most well-thought through network planning effort in the industry. This could provide benefits in market selection, scale-up and asset utilization of an airline.

Joby is taking a different approach than exists today in most mobility related industries. Over the last few decades, truck and airplane manufacturers have tended to decrease their level of vertical integration to improve capital efficiency and utilize specialized skills developed in the supply chain. Joby is not alone in this break with the recent past. Lilium has also announced plans to forward integrate into air taxi service. Volocopter, the German autonomous aviation company, has launched an air taxi service called Volocity and is aiming to begin operations in Singapore. At the same time, other players in the air mobility space like Jaunt Air Mobility and Bye Aerospace have opted for a leaner, less vertically integrated approach. Will one approach trump the other?

This isn’t going to be cheap

New aircraft programs cost a lot of money to move through certification. On the commercial side of the market, a new narrow-body aircraft could cost $10 billion to $15 billion and can take 10 years or more to bring to market. At the Revolution Aero conference earlier this month, Lee Human of Aerotec, a leading consultancy in this space, suggested that vertically integrated eVTOL (electric vertical takeoff and landing) programs would likely require $3 billion to move through certification alone.

Technological innovation creates certification timing and cost risk. eVTOL aircraft will have systems that look fundamentally different than most of today’s small aircraft including, eventually, the provision for autonomous operation. The Eclipse 500, a program that pushed the edge of the technological envelope to pioneer the very light jet (VLJ) category, has become emblematic of the risks of a technology forward approach. The program started in 1998 and only received certification in mid-2006 partially due to a requirement to re-engine the aircraft mid-stream. The first deliveries came in 2007, almost 9 years after the start of the program. The company ultimately ran out of capital due to cost overruns associated with the delays and the 2008 recession.

Setting up a scale commercial carrier will add another layer of capital needs on top of the certification costs of the aircraft. JetBlue raised $128 million to finance its start-up with two planes, and Volaris, now the largest low-cost carrier in Mexico, raised a similar amount to start with four aircraft. However, new commercial operators have the advantage of a well-developed leasing market that allows them to finance new aircraft at attractive prices. They can also slot right into the existing commercial aviation airport infrastructure with limited initial capital investment.

Starting an eVTOL-based air taxi service at a similar scale could cost much more. Given the relatively small capacity of these new eVTOL aircraft (typically four seats or less), to have the same seat capacity as JetBlue or Volaris on start-up one of these new operations might need 70 to 140 aircraft. At $1 million per aircraft that would be $70 million to $140 million in acquisition costs. Given the unknown lifecycle of these new aircraft, financing that via an affordable leasing program seems unlikely. Aircraft acquisition only represents a part of the total expense, which will include start-up expenses, inventory, route development and other overhead costs. In addition, these air taxi services will need to find new investment for charging infrastructure, terminal infrastructure, maintenance facilities etc. Growing the model would require even more capital for aircraft and for developing new routes, which can take 9-12 months to ramp to profitability in commercial aviation.

Put this all together and it may take $4 billion or more to fully develop a vertically integrated business in the UAM space. That business case will come with potentially high variability in terms of timing and cost that investors will need to plan around. Of course, the rewards of pioneering what Morgan Stanley predicts could become a $1.5 trillion market could make those risks more than worthwhile.

Historical Precedents: “We are the Uber of Aviation…”

Elevate ensured that the UAM space lives in a giant shadow cast by the analogy of Uber’s auto ride-sharing model. Uber took a cottage industry, the taxi business, professionalized and modernized it. Ride-sharing models utilized a contract workforce that knows how to drive and brings its own assets. It took the suboptimal taxi user experience and improved it dramatically, while simultaneously reducing the cost of service significantly through smart network management. Not surprisingly, these factors led to the rapid growth of demand and an asset-light business model. It was expensive to build out, but the operating leverage is less than a model that has to buy or finance the assets it took to operate.

Uber tried to build a similar on-demand model for the world of aviation, where it quickly became clear that regulation, labor relations and asset ownership conditions will create a different, less favorable business model.  Some companies have attempted ride-sharing style models in aviation and have run afoul of the FAA. Aviation requires a highly skilled workforce that tends to unionize and scales slowly. The low passenger to pilot ratio will create a pilot shortage if the UAM markets scale in a significant way.  These potential bottlenecks have led most competitors to set autonomous operation goals to enable scalability and manage costs. Carriers must buy their own assets or lease them, if financing is available, and take responsibility for their operations. As a result, vertically integrated UAM carriers will have asset intensive operations.

While it may seem a departure today, aviation and aerospace were vertically integrated in the era where airmail contracts guaranteed significant volume at set pricing. Boeing purchased aircraft engine maker Pratt & Whitney in 1929 and had started United Airlines before subsequently growing it via merger. The guaranteed volumes and pricing from airmail contracts limited Boeing’s exposure to the high levels of operating leverage this strategy created. In fact, those guarantees were so lucrative they led to scandal and eventually the Airmail Act of 1934. That law prohibited aircraft manufacturers from owning airlines and forced Boeing to divest United Airlines and to the spin-out of what eventually became United Technologies (including Pratt and Whitney). Although regional aviation receives some Federal money via the Essential Air Service program, these tend to serve poorer rural areas, not the premium services wealthy urban areas the UAM companies plan to target initially. Unlike Boeing in the 1930s, today’s vertical integrators will need to create their own stable, attractively priced demand to cover their operating leverage.

In contrast, Delta started as a company to solve a specific use case — the boll weevil infestation of the early 1920s. The company built aircraft for crop dusting and then built a crop-dusting aviation service to solve the problem. Designing a solution for a completely new use case feels analogous to the challenge that Lilium, Volocopter and Joby face today. Trying to solve the use case end-to-end via a tightly coordinated team could simplify the challenge. In addition, it is not clear that Lilium could find an air taxi airline customer for its UAM aircraft even if it wanted to do so. The carrier models that could buy and operate these aircraft simply don’t exist today, nor would most airlines feel comfortable operating this type of equipment on their own. To quote David Merrill, CEO of Elroy Air, who has considered building his own freight carrier in addition to the development of the company’s Chaparral autonomous cargo aircraft, “our commercial logistics customers understand the enormous value of our autonomous aircraft in expanding express middle-mile capacity, but many don’t want the added complexity of operating it in the early years.” (My firm DiamondStream Partners is an investor in Elroy Air.)

The Benefits And Risks Of Making An All-In Bet

Ultimately, aviation models usually depend on two things for success: directness of routing to save time, and cost to produce the service (of which the biggest driver is asset utilization). The Elevate team combined with the Uber Partnership, can help Joby significantly in both respects. Via its modeling efforts around UAM network optimization Elevate’s insights can help reduce costs by improving asset utilization of the carrier model. Its practical experience with Uber Copter into how to integrate ride-sharing networks into UAM services to create seamless multi-modal experiences should cut time off customer trips. Based on what we know about stimulation of aviation demand, those two value-adds should help grow the market significantly.

Set against those benefits, stand a few substantial risks. Unlike Boeing’s vertical integration strategy of the 1920s and 1930s, new UAM carriers will find it hard to predict volume early on. Cars represent a formidable competitor. They cost about 37 cents a passenger mile at average occupancy — probably a tenth or less of what UAM services will initially cost. Commuters are highly sensitive to transportation costs and a 22-mile commute each way might cost $130/week via car including parking. At $2/mile, which is the cost for an Uber ride-share today, the same commute would cost about $440/week. At $4/mile, a more realistic initial price for UAM services, it would cost closer to $880/week, although it could be lower in the case of someone who works remotely most days. In an environment where increasing numbers of people work from home and congestion eases, the time advantage of a multi-modal trip based on flights may also decline.

In addition, competition from new forms of fixed-wing aircraft could limit UAM volume, particularly in the early years before urban vertiport infrastructure build outs. Fixed-wing airplanes retrofitted with hybrid-electric propulsion systems should become available about the same time as eVTOL aircraft. These fixed-wing planes could transport passengers at lower cost than the initial eVTOL vehicles due to the greater efficiency of fixed-wing flight, the ability to use existing fueling infrastructure, and their larger number of seats.  These types of operations could also scale more easily due to the higher passenger to pilot ratio.  In commercial aviation, operators that fly smaller, less efficient aircraft often find themselves in the role of developing routes for operators with lower cost, higher capacity planes.

A third concern involves unionization. Given the scale of operations that UAM businesses plan to develop, this industry will most likely have unions that look more like the unions in the regional aviation or the commercial aviation industry than the less unionized charter industry. Pilots unions tend to negotiate contracts that increase the operating leverage of today’s commercial airlines, although some low-cost carriers have variable pay union contracts. As the demand for pilots from electric aviation growth increases, pilot shortages could give unions increased leverage over these businesses. More importantly for the vertical integrators, the unions will probably express reservations about the pace and safety of the transition to autonomous flight technology that the UAM companies will depend on to push costs down and stimulate demand.

Finally, this strategy could create some channel conflict between the vertical integration plays and pure play carriers. Uber Elevate comes complete with a valuable network of partners. Many of these, like the relationship with Signature Flight Support, should translate seamlessly into Joby’s vertically integrated model. However, why should the airframe partners want to support the network of one of their largest and best financed competitors? Even with a carrier strategy, none of the airframe companies with vertical integration plans will have the capital to roll-out these networks globally right away. It will just cost too much. If it is demand and not vehicles in short supply, non-affiliated airlines may choose to use vehicles from manufacturers that don’t compete in their core business.

Partnership strategies can help mitigate some of the risks from operating leverage and labor relations that vertical integration will create. Today, the major commercial carriers purchase capacity from the regional carriers instead of owning and operating those fleets. WheelsUp had a similar kind of operating arrangement with Gama in private charter. While these arrangements certainly have their advantages, the operating leverage will live somewhere in the vertically integrated system and the partners will probably not want to accept the operating leverage without some type of guaranteed volume contract.

Playing To Win

In the end, UAM represents an entirely new transportation model that requires new technology, infrastructure, systems and regulatory frameworks to deliver a cost-effective transport solution with direct connections and a good customer experience. Vertical integration strategies give Joby, Lilium, and Volocopter more control over the levers required to launch in the industry, which could give them, and by extension the entire industry, a better chance of large-scale customer adoptions. However, this strategy also comes with far greater capital requirements, the daunting task of becoming the best at multiple steps of the value chain, and the prospect of channel conflict that slows scaling in their non-priority markets.

The Lilium, Joby, and Volocopter carrier strategies suggest they believe proprietary volume will ramp up quickly. These companies face a chicken and egg problem: To stimulate demand they need the scale, but to pay for the capital required to grow demand also requires scale. When demand is uncertain, playing to win by increasing operating leverage takes vision, courage and deep pockets.

The city of Orlando is making additional investments for the aerial mobility framework of the future. The Orlando Business Journal reported that the Orlando City Commission is preparing to offer a total of $831,250 USD in tax benefits to Lilium over a period of 9 years to engage and attract aerial mobility companies to create an estimated 140+ jobs in the Lake Nona development.

Lilium reportedly was quoted stating that the investment is earmarked towards construction of a 56,000 square foot transportation hub, which would substantiate the job increase figures quoted. This transportation hub would serve as the primary means for aerial mobility operations for Lilium within Florida, and would likely serve other cities and locales with smaller scale “sub-hub” vertiports or individual helipads.

The agreement also underscores another often overlooked component of aerial mobility implementation – the personnel required to run the business. While a key facet of future mobility is ongoing automation of previously manned tasks, the bridge solution between current technological readiness and that of the 22nd century will include humans in the loop for the forseeable next decade, or two. Accounting for and planning the infrastructure for human interaction and operations that interface with the aerial mobility industry (across design and operations phases) is crucial to short-term success that will ultimately allow for mid to long term success.

Not unlike current fulfillment centers, aerial mobility transportation hubs will require personnel to perform quick turn actions to replenish battery packs, conduct maintenance and troubleshooting on aircraft needing repairs, and manage the physical implications of safety stocks of parts and other supply chain considerations. Increasingly, the infrastructure to support these applications is very similar to that of current factories and fulfillment centers, which also represent economic advantages to commercial land owners and developers within local economies.

Why it’s important: Orlando’s agreement with Lilium will provide an economic boost to the area, in addition to more jobs, and emphasizes the importance of human touch-labor for aerial mobility processes today. Bridge solutions will involve human interaction with eVTOL technology for at least another decade, which mean that there is additional opportunity for local economic development and stimulus from the aerial mobility industry prior to any commercial air taxi operations taking place.

Source // Orlando Business Journal

Lilium, the Munich-based aviation company developing an all-electric, vertical take-off and landing aircraft for regional air mobility, has agreed with both Dusseldorf Airport and Cologne/Bonn Airport to explore how the two airports can become hubs within a regional air mobility network spanning North Rhine-Westphalia. Lilium plans to establish regional air mobility as a new mode of transportation, using its fully electric, 5-seater aircraft by 2025.

Rendering of a possible vertiport at Cologne Bonn Airport (Copyright: CGN/Lilium)

The announcement was made this week in Dusseldorf in the presence of the Transportation Minister of North Rhine-Westphalia Hendrik Wüst. As the largest and most densely populated German state (18 million inhabitants), including ten cities with over 300,000 inhabitants, as well as more than 40 universities and colleges and four international trade fair locations, North Rhine-Westphalia is an ideal location for Lilium landing sites. The Rhine-Ruhr metropolitan area is the largest in Germany and the third largest in Europe. It now aims to become home to mobility in the third dimension.

North Rhine-Westphalia Transport Minister Hendrik Wüst explained: “What sounds like science fiction today may soon be reality. In the federal state with the highest mobility needs, smart ideas for better mobility are always welcome. We need all modes of transport in order to provide people with a convincingly diverse range of mobility options.“

He added: “North Rhine-Westphalia is a model region for the mobility of the future. We want digitally-networked mobility in North Rhine-Westphalia not only to be researched and developed, but also experienced as soon as possible. This is why we support and promote many future-oriented projects and research projects here in North-Rhine-Westphalia.”

As international traffic hubs with excellent connections to air, rail and road traffic, the two airports Cologne/Bonn and Dusseldorf are an ideal starting point for the development of networked mobility, which also includes air taxis.

“We are excited to bring our innovative service to North Rhine-Westphalia,” says Lilium COO Dr. Remo Gerber. “Cities such as Aachen, Bielefeld, Münster and Siegen will be directly connected to the region’s largest international airports within 30mins, providing emission-free, high-speed connectivity at an affordable price.”

Remo Gerber added: “North Rhine-Westphalia and its airports are ideal partners for us to implement this ambitious project of the future – we are grateful to receive this support from both the Ministry and our partners at the airports to implement our vision”.

Why it matters: Lilium’s partnership with Germany’s Transport Ministry will be crucial in making aerial mobility a reality in the region. The partnership will ensure the company has public sector support in recruiting talent, meeting with regulators, and garnering public support. Expect to see more partnerships like this one across the globe as manufacturers ready their prototypes for flight.

Source: Lilium

According to local news sources, board members of Tampa Bay Area Regional Transit Authority met virtually last week to discuss the future of transportation for the area, after being pitched by German air taxi developer Lilium. According to Lilium, flights could carry passengers from Tampa to St. Petersberg in 8 minutes. This journey that could help ease traffic over the two bridges over Old Tampa Bay that currently connect the two cities. The distance of the flight would be about 25 miles, and would cost passengers $90 per seat (significantly cheaper than existing helicopter options).

The potential Lilium route in the Tampa Bay Area

Said Chris Jadick, Director of Communications for the Tampa Transit Authority:
“We have real transit needs now…TBARTA is looking toward future transit innovation technology such as air taxis that are really going to define how we travel in the decades to come. One of the things they say is, look, if we can make that flight at eight minutes and it takes a taxi 35 to 45 minutes to do the same thing, we’re going to be more efficient because we can do more flights in less time.”

Jadick also mentioned the potential for autonomous operations in the area saying, “…as technology develops, if we get to autonomous vehicles that do not require a pilot, that too is going to bring the cost down.”

Ultimately, The TBARTA board made a motion to move forward in learning more from Lilium. A representative said: “We’d like to get more information. We’d like to report at our next board meeting on what it would take to do a pilot study”. According to the TBARTA, Lililum was asked when it might be able to launch initial operations, and the company responded with an estimate of 2025.

Notably, Lilium is not the first aerial mobility company to get involved in Florida. Prior to COVID-19, BLADE Air Mobility (which already provides by-the-seat helicopter charters throughout the U.S) had planned an entire sea-to-shore transport route to support tourists visiting Miami for events like the Super Bowl, Art Basel, and the Miami Open. In addition, real estate companies like Royal Palms have begun including rooftop vertiorts in the designs for their upcoming buildings, such as the Paramount Miami Worldcenter.

The concept for a vertiport on the rooftop of the Paramount Miami Worldcenter

Why it’s important: This pitch in Tampa by Lilium represents the company’s first reported effort into developing air taxis in an area other than Europe. Although Lilium has yet to report how many U.S cities it has approached, this development from Tampa is a strong indicator of its intention to enter the aerial mobility market in the U.S.