Electric vertical takeoff and landing (eVTOL) air taxis are now in development, and many individuals are as enthusiastic as the manufacturers who are developing this cutting-edge technology.
Different firms are putting in long hours to ensure that electric vertical takeoff and landing vehicles (eVTOLs) can be utilized as soon as feasible while keeping safety standards.
VTOL aircraft powered entirely by electric, hybrid, or gas engines were chosen for this article, as were firmed building VTOL aircraft that will be powered entirely by alternate sources of electric power in the foreseeable future.
Electric vertical takeoff and landing (eVTOL) firms provide products that utilize this technology. These aircraft are powered by comparable technology to small drones and hover in a manner similar to helicopters. However, eVTOL vehicles are far larger and built to transport passengers.
This type of technology has a plethora of potential applications. Indeed, the majority of eVTOL businesses are exploring the possibility of developing electric air taxis in major cities. EVTOL technology has the potential to be used for emergency services, deliveries, and more in the future.
While the electric vertical takeoff and landing vehicle (eVTOL) industry is still in its infancy, it aspires to challenge established modes of transport. Air taxis, flying ambulances, and even regional airliners are all envisioned. And if any of this seems implausible, just listen to the money. In 2021, the eVTOL industry saw a banner year, with several businesses obtaining hundreds of millions of dollars in capital and others going public.
One of the significant advantages of eVTOLs is their low carbon footprint, as they run on electricity rather than gas or diesel. Additionally, eVTOLs are quite quiet, and their ability to fly allows them to avoid traffic congestion.
In 2021, there were some encouraging signals that the eVTOL industry is here to stay. Four eVTOL investments went public, and many others received significant funding, including from major players such as Hyundai and United Airlines.
Though industry forecasts vary, some predict that eVTOLs will be commercially available as early as 2024. However, before eVTOLs can take center stage, they must overcome considerable obstacles.
Why has eVTOL grown well in the past few years?
Significant Funding Activity
Archer Aviation and Joby Aviation of California, along with Lilium of Germany and Vertical Aerospace of the United Kingdom, raised hundreds of millions of dollars in new cash in 2021 to stay alive until commercial revenue begins to flow.
Rather than conducting standard initial public offerings (IPOs), Archer, Joby, Lilium, and Vertical Aerospace chose to merge with special purpose acquisition corporations (SPACs) as a more expedient route to public status. As a result, they were converted to publicly traded stocks. By mid-December, all four firms' stocks were heading lower in relation to their initial values.
Nonetheless, the additional cash enabled them to expand operations and build their aircraft in preparation for certification.
According to analysts going public also aided in establishing the credibility of eVTOLs and the air taxi business model in general.
While Volocopter abandoned its SPAC intentions, Embraer's Eve Air Mobility chose the opposite path, announcing a 2022 merger with a SPAC.
In September, Morgan Stanley designated Joby as a possible front-runner, assigning it an "overweight" rating. Analysts forecast Joby's stock to outperform others in its market sector, which is expected to reach a trillion dollars in the future by 2040.
Airlines Take Notice
United Airlines raised eyebrows in February when it announced a tentative deal worth $1 billion to acquire Archer eVTOL aircraft.
This was especially significant because Archer had not yet announced or tested a prototype aircraft at the time of the announcement. The transaction demonstrated to investors that it was backed by one of the world's largest airlines and most recognizable aviation brands. In December, Archer successfully completed the first flight of its autonomous, two-seat demonstrator, Maker. For the first time, the brief hover test established that Archer's design was capable of flight. Additionally, the flight placed Archer on par with other eVTOL manufacturers that have flown demonstrator aircraft, including Lilium, Joby, and Wisk Aero.
Big Push To Build Vertiports
Without ground infrastructure, it is impossible to operate an air taxi airline. To be truly viable, eVTOLs will require strategically located vertiports to provide efficient facilities for boarding and exiting aircraft, charging batteries, and providing daily aircraft maintenance.
Due to the high cost of technical infrastructure, prominent eVTOL businesses announced collaborations in 2021 to create new facilities—or repurpose existing ones.
"Infrastructure is critical to unlocking the eVTOL industry because it enables the product to be valuable to customers," said Robin Riedel, a partner at management consulting company McKinsey & Company, which examines and tracks disruptive aerospace and air transport companies. "At the same time, they are difficult and typically require years of development."
Businesses Concentrate Their Efforts in Asia-Pacific
This year, the industry offered strong signals that the Asia-Pacific region could be a leader in eVTOL.
Volocopter announced a significant partnership with Aerofugia of China. Volocopter Chengdu, a new company, will collaborate with the Chinese government to launch the eVTOL service by 2026.
In neighboring South Korea, Volocopter conducted the country's first flying demonstration of its 2X prototype in November, indicating the company's intention to create an air taxi service there.
Auto Manufacturers Want a Piece of eVTOL
Additionally, in 2021, Honda and one of Detroit's Big Three automakers—Stellantis (formerly Fiat Chrysler Automobiles)—entered the eVTOL fray. Along with nearly a century of car manufacturing and project management experience, these heritage firms' cooperation demonstrates a strong vote of confidence in an untested 21st-century transportation concept.
Archer will receive cockpit design components and superior composite material capabilities from Stellantis, the parent company of Chrysler, Dodge, Jeep, and Ram. Honda is developing the new aircraft as part of a broader "mobility ecosystem" that will incorporate ground transportation, air transportation, and reservation service.
To begin, numerous industry analysts expect a bright future for eVTOLs. Morgan Stanley, for example, forecasts a $1.5 trillion market by 2040. Deloitte anticipates $115 billion in revenue by 2035, with eVTOL deployment beginning in 2025.
Second, while industry analysts believe the eVTOL business has significant potential, there is no agreement on when it will "take off." While revenue forecasts are bullish, there are yet no eVTOL companies that produce revenue. They are environmentally beneficial due to their all-electric propulsion. Additionally, they may aid people in traveling more efficiently, particularly in congested areas.
Third, the eVTOL market is confronted with a number of hurdles, and one of them is regulation.
Numerous firms apply to the Federal Aviation Administration (FAA) for certification to develop and operate their flying vehicles. Additionally, the eVTOL industry has an infrastructure bottleneck. Before the industry can take flight, it requires a landing strip. However, because landing space is limited, considerable infrastructure investments are required before eVTOLs can become ubiquitous. However, one company is attempting to accomplish precisely that. Archer, a California-based eVTOL business, recently announced a partnership with Reef, the nation's largest parking operator, to establish landing zones in major US cities.
Finally, eVTOL firms may be able to provide more efficient local delivery.
In recent years, consumers have shifted away from traditional brick-and-mortar retailers, preferring to shop online instead. This creates a significant need for efficient delivery services.
Due to the fact that these trucks are expected to operate without drivers, e-commerce businesses might save labor expenses and offer more frequent deliveries.
We have no way of knowing for certain whether eVTOLs have a viable business strategy. As a result, they are a rather speculative investment possibility.
1. Joby Aviation (NYSE: JOBY)
Joby Aviation is one of the most enticing brands in this fledgling industry. The company said earlier this year that it intends to acquire Uber Elevate.
Uber is one of the most successful ridesharing services in the world. Joby Aviation announced the acquisition of Uber Elevate at the end of 2020 to accelerate its urban air transportation industry growth. This is a significant stride forward for Joby, and its stock price has reflected this.
Joby is likely the most near to offering its services of all the electric air taxi firms on the market.
Joby Aviation has already demonstrated that its airborne mobility technology works by conducting prototype tests since 2017; the company has also collaborated with NASA to test its goods. The company's new partnership with Uber will also aid in the expansion of its testing operations.
Joby's vehicles have a range of 150 miles and a top speed of 200 miles per hour on a single charge.
Analysts are quite bullish on Joby stock, and several have increased their price estimates for the company in the coming years.
2. Astro Aerospace (OTC: ASDN)
Astro Aerospace is demonstrating its commitment and that eVTOLs are the company of the future. The company's mission is to revolutionize transportation by offering people speedier options.
They're developing something that many people have wished for a long time – flying taxis.
Astro wishes to establish contact with the future as quickly as possible. The company was created in 2007 and is based in Texas, United States. They made it their duty to develop the flying vehicles that everyone anticipated and make them immediately available to the public. Additionally, they intend to make them extremely accessible and a practical mode of transportation for the majority of people.
What distinguishes Astro Aerospace is its accomplishments thus far.
They have over a century of aircraft engineering experience and were the first to do an eVTOL flight with a passenger aboard. Additionally, they have four years of demonstrated eVTOL testing and more than six years of eVTOL development. Additionally, they offer three solutions that cover the AAM market and have demonstrated leadership.
Astro's stock already soared in 2021 when it entered a definitive deal to acquire Horizon. Horizon is the inventor of the world's first eVTOL aircraft that flies like a conventional aircraft. They have had an incredible start to the year, and more incredible things are possible in the coming months, which is why investors should not neglect them.
3. Vertical Aerospace (EVTL)
Stephen Fitzpatrick created Vertical Aerospace in 2016. They are headquartered in London and went public via SPAC in December 2021, albeit their stock has underperformed since then.
EVTL distinguishes itself by providing services to the eVTOL industry. They design, manufacture, sell, and service eVTOL aircraft, collaborating with rather than competing with eVTOL operators. The VX4, EVTL's current model, is expected to have a range of 100 miles and a top speed of 200 mph.
EVTL intends to achieve complete certification by 2024 and begin commercial operations in the mid-2020s. In 2021, they reported that American Airlines, Virgin Atlantic, and Iberojet had placed pre-orders for 1,350 eVTOLs. American Airlines has apparently pre-ordered 250 eVTOLs – an approximately $1 billion commitment with the option to purchase a further 100 aircraft.
Avolon, Rolls Royce, American Airlines, and Honeywell are among the notable investors.
4. Blade Air Mobility (BLDE)
Blade is a global urban air mobility platform based in New York, New York, enabling people to schedule flights to escape congested ground traffic and save time.
What's wonderful about Blade is that the company is already profitable but wants to expand by 2024 with the addition of an all-electric, carbon-neutral aircraft fleet.
Blade operates under four distinct business models:
Flights between 60 and 100 miles cost between $595 and $795 per seat.
Blade Airport: Flights to and from all of New York City's airports and dedicated Blade lounges in Manhattan. Prices begin at $195 (or $95 with the purchase of an annual airport pass).
BLADE MediMobility: Blade is the leading organ transporter in the Northeast United States and aims to boost revenue as the passenger business grows.
Blade established a joint venture in India to operate passenger flights between Mumbai, Pune, and Shirdi.
By hosting a third-party app that enables passengers to book short-distance helicopter trips around the United States, the company operates an asset-light business model.
Blade earned $67.2 million in revenue (up 156 percent year over year) in 2021 and actually earned a profit of $770,000 in the fourth quarter of that year.
By 2026, the company intends to generate $825 million in revenue, implying a conservative valuation of between $8 and $10 billion over the next five years.
Blade also benefits from a strong balance sheet, with $281 million in cash and less than $1 million in long-term debt maturities. Currently, the company trades at an appealing Price to Sales ratio of just 7, which is significantly lower than the current average for growth stocks.
BLDE stock is now trading at just $8 on a $600 million market cap, indicating that Blade has a lot of room to grow in the future.
5. EHang Holdings Ltd. (NASDAQ: EH)
EHang Holdings is a Chinese company specializing in urban air transport and intelligent technology. This company is the market leader in China's air taxi industry and has been conducting test flights since 2017.
EHang's mission is to create safe, efficient, and environmentally-friendly transportation solutions through the application of technology leadership in areas such as aviation, smart manufacturing, and intelligent transportation systems.
EHang's cars are capable of transporting passengers as well as delivering goods. While many eVTOL firms are still in the pre-revenue stage, EHang is already profitable, putting them financially ahead of the competition.
EHang stock has effectively traded sideways for several months following a February spike. While there are always dangers connected with Chinese enterprises, EHang has the potential for significant development if its vehicles are successful.
6. Volocopter
Volocopter is extremely likely to be one of the stocks to watch in the coming years since they made great development in just 2021. This company was one of the very first on the scene in 2013 when it launched. They developed a two-seat multi-copter in the vicinity of Stuttgart, Germany. At the time, the company retained the name E-Volo.
The company scheduled many demonstration flights over various locations to demonstrate its capabilities. They flew over Stuttgart, Singapore, and Dubai successfully. Given the multicopter's appealing design, who wouldn't want to fly in one of these beauties? Volocopter has invested more than US$130 million, and with more funding, it can accomplish even more.
7. Lilium (LILM)
Germany-based Daniel Wiegand, Sebastian Born, Matthias Meiner, and Patrick Nathan launched Lilium in 2015. Their current eVTOL has a range of 155 miles, a capacity of seven passengers, and a top speed of 186 mph.
Lilium announced a $1 billion deal with Brazilian airline Azul in 2021 to develop a nationwide network of eVTOL aircraft by 2025. The transaction entails the purchase of 220 Lilium eVTOL aircraft.
Lilium went public via SPAC in September 2021. Since the IPO, the price has plummeted, with new reports from Iceberg Research raising questions about Lilium's viability.
8. Jaunt Air Mobility
Over the last year, Jaunt Air Mobility has formed a series of industry partnerships to assist in the acquisition of aircraft components and infrastructure elements necessary to enable a future UAM ecosystem that enables its Journey air taxi to perform a variety of civilian applications ranging from passenger services to medical evacuation. The largest of these recent collaborations is with Varon Vehicles Corp. to create new "Vertiports" in a number of Latin American countries, beginning with Colombia. Throughout 2021, Jaunt Air Mobility will collaborate with Varon Vehicles to better understand the mobility needs of Latin American cities and will assist in defining the operations and integration of its Journey aircraft. This will lay the groundwork for an early demonstration of the Jaunt Journey aircraft and the operational concept of Varon Vehicles. Jaunt intends to begin commercial production of their air taxi in 2026.
Final Thoughts
eVTOL technology has the potential to fundamentally alter how we travel in the next decade. However, exercise caution while selecting eVTOL stocks since not all competitors are created equal – particularly in an emerging technology field.
Conduct an investigation and ensure that you are aware of the company's more than a few methods for market success.
If you do your homework, investing in eVTOL stocks today could be an excellent way to profit from this exciting trend.
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