Next-gen, electric mobility is coming, folks. Whether you like it or not, travellers will soon have the option of regional air shuttle travel.
Air taxi start-ups are springing up all over the world, including German company Lilium, which has entered into a merger agreement with publicly listed acquisition firm Qell Aquisition Corp., Aerospace Technology reported.
Established last year in San Francisco, Qell — former General Motors executive Barry Engle’s blank-check company — specializes in developing next-generation and sustainable mobility.
The post-merged company is expected to receive gross proceeds of approximately US$830 million from the deal, which includes US$450 million from a fully committed common stock PIPE offering and $380 million cash, the report said.
Upon closing of the transaction, the combined business will be valued at US$3.3 billion.
The merged entity will be called Lilium and listed on the NASDAQ under the ticker symbol LILM, the report said.
It’s the latest deal involving an electric vertical takeoff and landing (eVTOL) startup after the SPAC deals of Archer and Joby Aviation, The Verge reported.
A SPAC is a blank-check corporation, formed as an alternative to an IPO, because it raises funds for an operation that doesn’t have revenue of its own.
There have been a rash of SPAC deals involving companies in the transportation space, including electric cars, autonomous vehicles, and micromobility.
Engle, a longtime executive vice president and president of GM’s North America division, will join the board of the newly formed company, as well as former Airbus CEO Tom Enders. Engle described Lilium’s product as “a highly engineered aircraft.”
The type of aircraft Lilium is developing is typically called a “flying car,” electric-powered, able to carry only a handful of passengers, and intended for short flights within a city or regionally.
These types of vehicles are still in their prototype phase and have yet to be rolled out for commercial service.
In a separate development, Munich -based Lilium has unveiled a new seven-seater model to complement its five-seater fixed-wing prototype.
Designed for ease of manufacturability and scalability, the aircraft will feature 30 times fewer components compared with commercial aircraft, the report said.
The seven-seater Lilium Jet will have a range of more than 155 miles and cruise at 175 mph.
The aircraft will be the first model to go into serial production.
It has already received the CRI-A01 certification basis last year from the European Union Aviation Safety Agency, the report said.
Lilium co-founder and CEO Daniel Wiegand said: “We’re incredibly excited to reveal the development of our seven-seater Lilium Jet and announce the next stage of our growth.
“Our vision is to create a sustainable and accessible mode of high-speed travel and bring this to every community. Transport infrastructure is broken. It is costly in personal time, space consumption and carbon emissions,” he said.
“We are pursuing our unique electric jet technology because it is the key to higher-capacity aircraft, with a lower cost per seat mile while delivering low noise and low emissions.”
Lilium’s move to raise capital via a reverse-merger is the latest signal that the race among aviation startups to launch a battery-powered air taxi is heating up, Forbes reported.
Joby raised U$1.6 billion in its own reverse merger with a blank-check company in February that valued the California-based business at US$6.6 billion.
Lilium’s German rival Volocopter also raised US$239 million from investors including BlackRock earlier this month, according to Reuters.
Lilium has also announced plans to develop a network of “vertiports” across Florida with Spanish infrastructure company Ferrovial, which is the owner of London’s Heathrow Airport.
The largest model the company had revealed previously was the five-seat technology demonstrator that made its first flight in May 2019 and underwent a low-speed flight test campaign before it was destroyed in a fire during ground maintenance activities in February 2020, eVTOL.com reported.
Lilium CEO Wiegand told eVTOL that the company will be resuming flight testing with an upgraded version of the smaller demonstrator this summer.
But the production model that will undergo certification is the seven-seat aircraft that is currently in a detailed design stage, he said.
Lilium expects to produce its first conforming prototypes next year, then take them through a two-year ground and flight test campaign with the goal of launching commercial operations in 2024.
Sources: Aerospace Technology, The Verge, Forbes magazine, Reuters, eVTOL.com, Lilium.com