By Joanna Plucinska
GENEVA (Reuters) – A drop in tech stock valuations, economic pressures, and a risk-averse investment environment in Europe are some of the hurdles air taxi firms like Germany’s Lilium NV and Volocopter are facing, according to CEOs from the industry.
Electric vertical takeoff and landing aircraft (eVTOL) have been touted as the future of urban air mobility and have drawn global interest, with several eVTOL companies going public.
Germany’s Volocopter is working to fly its air taxis commercially at the Paris Olympics in 2024, in close collaboration with Europe’s main aviation safety regulator EASA and Paris airports.
But securing enough investment to propel the new technology forward, especially before companies have received certification from regulators, is an ongoing concern.
“Going into financing right now in such an environment is the challenge,” said Volocopter CEO Dirk Hoke at EBACE, Europe’s flagship business jet event held in Geneva this week.
“You’re in the famous valley of death. You’re not early stage anymore, you’re pre-revenue … and this in combination with these uncertainties that people don’t understand the certification pathway is the stress factor to the industry,” he said.
Convincing investors the technology is sound, and the business model scalable, is also part of the concern, especially in more risk-averse investment environments like Europe.
“Everybody is your best friend when you have made it, when it’s already successful,” Lilium NV CEO Klaus Roewe said, adding Lilium had found more willing investors in China.
Earlier this month, the company said it would raise up to $250 million, including from its largest shareholder Tencent Holdings.
Roewe urged investors not to lose faith, especially as more cities express interest in building infrastructure for an air taxi system.
“If nobody takes the risk, the universe is never evolving.”
(Reporting by Joanna Plucinska; Editing by Mark Potter)