The race to get the “flying car” into operation is approaching its final stage. So far, more than a hundred companies have been carrying out research to create an eVTOL (English acronym for vertical take-off and landing vehicle, as the aircraft is officially called). But recent mergers with Spacs (companies that first go public on the Stock Exchange and then look for a project to invest in) have placed some startups in the top positions of this billion-dollar race and bring us closer to the technology that should revolutionize urban mobility.
In addition to attracting attention in the capital market, “flying car” startups are attracting talent and partners from more traditional sectors of the economy. Executives and engineers from companies such as Airbus, Embraer, Boeing, Ford, Rolls-Royce, Jaguar, Goldman Sachs and Morgan Stanley, among others, are today behind the startups.
The dispute between these startups gained strength even last year, when large-scale investments began to appear in the sector – without which the development of technology is unfeasible. In a report on the eVTOLS market, the Lufthansa Innovation Center highlighted that companies that are better capitalized will have a greater chance of reaching the market first. “This is even more important in a complex industry, where startups need a minimum capital of $700 million to $1 billion to successfully develop, certify and market air taxi.”
Lufthansa also stated that the venture capital (venture capital) investments made in the American Joby Aviation and the German Lilium – the two received a total of US$ 940 million in 2020 – placed them in pole position. The point is that, in recent months, the movement of mergers between eVTOLs and Spacs startups has confused the dispute in the sector and raised it to another level.
This year, Joby, Lilium, the American Archer and the British company Vertical announced combinations of their businesses with Spacs. Thus, the four companies must raise US$ 3.9 billion (R$ 20 billion). Brazilian Embraer is another that has been trying a merger similar to that carried out by competitors to develop its eVTOL, but it is at a more incipient stage. Sought, she didn’t want to talk about her project.
model of success
Consultant Marcus Ayres, a partner at Roland Berger who has been following the development of eVTOLs, says it is difficult to predict which startup will succeed, but the business model with the most chance is that of a company that is part of the value chain. A Roland Berger report points to Lilium and Joby as doing the best in this direction.
Joby, for example, should not only be a manufacturer, but also an operator – it has already applied for registration for that. By email, the company stated that “operating a ride-sharing service, rather than selling vehicles, is important both to ensure the optimal customer experience and to create an attractive recurring revenue business model.” Lilium, meanwhile, is planning to offer what it calls “branded service”.
According to Lufthansa, however, there will be room for several winning companies. This is because there are different projects for specific demands – for flights within cities or between cities, for example. In addition to the volume of investment that startups receive, the breadth of these companies’ network and partnerships – including here governments, technology, automotive, aerospace and airline companies – will also be important.
No wonder eVTOL startups have announced partnerships quite often. Embraer’s Eve has released ten deals with third parties since June. The American Archer, in addition to receiving investment from United Airlines, has a cooperation agreement with the airline for the certification process with the agency that regulates aviation in the USA and has signed contracts of up to US$ 1.5 billion to supply eVTOLs to company.
The British company Vertical, in turn, will have American Airlines as an investor and must provide the company with up to 350 eVTOLs. In a statement, American said it is studying how it will use these aircraft in its operation.
Also in Lufthansa’s assessment, being among the first to put the “flying car” in the air will make a difference when the market starts to consolidate. This has already been verified in the autonomous car segment, in which the kilometers traveled by vehicles have become the main item in the evaluation of companies. The same should happen with the eVTOLs manufacturers, who are also preparing to carry out autonomous flights.
Given this concern and the fact that tight schedules are more attractive to investors, startups are promising to deliver aircraft in 2024. Embraer forecasts its first eVTOLs for 2026. In Roland Berger’s view, this delay does not necessarily represent a disadvantage – contrary to what Lufthansa claims. “There is one thing that is good for innovation in general: the first is not always the winner. Certainly, the first one will make mistakes, because he won’t have anyone to learn from.”
If it is still difficult to bet on the likely winners of this race, experts and bankers point out that it is certain that we will see technology come out of the paper in the coming years and create a market worth billions of dollars. For consultancy Deloitte, in the US alone, this market would be US$17 billion in 2040. “The ecosystem participants are collaborating in the development of a robust regulatory framework; and technology is advancing rapidly,” says a company report.
Morgan Stanley Bank projects that the sector will move US$9 trillion globally in 2050, considering not only the operation of eVTOL as an air taxi, but also its use for military, logistical and airline purposes. “The birth of eVTOL in scale is not a question of ‘if’, but rather of when, how and what should be overcome along the way”, says a May bank document.
The “flying car” does not resemble the one used by the characters in the Jetsons cartoon. The aircraft is more like a helicopter and its use will be shared – you won’t have an eVTOL of your own. Even so, the technology is still revolutionary;
One of the main differences between eVTOL and helicopters or planes is that it will be electric. Without using jet fuel, the environmental impact and cost of operating it are reduced;
Aircraft are being designed to be less complex than helicopters and, electric, will require less maintenance, making them cheaper. In the case of helicopters, maintenance corresponds to 30% of operating costs. More affordable, eVTOLS could have the same popularity as commercial aircraft, experts say;
Another advantage of the electric motor: it is quieter. This will allow a greater number of aircraft to operate in large urban centers without generating noise pollution;
The projects foresee several redundant systems in the aircraft. So if there is a problem with a part or software, there is something similar to replace it. Experts say eVTOLs should be safer than helicopters
The information is from the newspaper The State of São Paulo.
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