#8 Deeptech Trends | The Electric VTOL (eVTOL) Aircraft Market Analysis: Trends, Forecast, and Competitive Landscape of Key Players
Unveiling the Future: DeepTech Trends Analysis for Reshaping Tomorrow
The Electric Vertical Take-Off and Landing (eVTOL) aircraft market is witnessing an era of innovation and transformation, with the potential to revolutionize urban transportation. As engineers, investors or just tech enthusiasm, it is essential to stay abreast of the latest trends, forecasts, and competitive landscape of this sector. This article provides an overview of the eVTOL market, along with a description and financial analysis of major companies operating in this dynamic industry.
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Take a look through my earlier eVTOL articles to grasp the essence of this cutting-edge technology and unravel its awe-inspiring mechanics.
Overview:
eVTOL aircraft are electrically powered vertical take-off and landing vehicles designed to navigate congested urban environments. These aircraft offer the promise of efficient, autonomous, and eco-friendly transportation, with applications ranging from air taxis and cargo delivery to emergency services and personal air travel.
Around 250 companies are striving to revolutionize urban transportation. Some like Volocopter, Lilium, and Joby have prototype aircraft, while others have conceptual designs. If this vision becomes a reality, numerous eVTOLs could fill the skies during rush hour, efficiently transporting passengers at affordable costs comparable to driving a car. Referred to as urban air mobility or advanced air mobility, achieving this vision entails overcoming challenges in certification, technology development, and safely managing a large fleet in limited airspace.
Global Market:
The global financial markets of eVTOL are poised for an electrifying future as they harness the potential of fully electric and hydrogen-electric segments. Projections indicate a robust compound annual growth rate (CAGR) of 15% to 19% from 2023 to 2028, illustrating the market's upward trajectory on a global scale. This remarkable growth is fueled by various factors, including the soaring demand for eco-friendly and noise-free aircraft and the expanding utilization of eVTOLs in cargo applications.
Already making substantial strides, the global eVTOL aircraft market achieved an impressive size of US$ 11 billion in 2022. Looking ahead, financial experts anticipate even greater heights, with market forecasts projecting a remarkable value of US$ 26 billion by 2028. These promising figures position the eVTOL aircraft market as a compelling investment opportunity, driven by the increasing demand for sustainable aviation solutions and the pursuit of innovative transportation alternatives.
However, air taxi manufacturers, such as Lilium NV and Volocopter, face challenges in securing investments. The drop in tech stock valuations, economic pressures, and a risk-averse investment environment in Europe pose hurdles to obtaining necessary funding. Despite the global interest in eVTOL as the future of urban air mobility, the acquisition of sufficient capital before regulatory certification remains a concern. The CEOs of Volocopter and Lilium highlight the difficulties of securing financing in the current environment, emphasizing the uncertainties surrounding the certification pathway as a stress factor for the industry. Convincing investors of the technology's viability and scalability of the business model presents another significant challenge, particularly in risk-averse investment climates like Europe.
Nonetheless, the CEOs urge investors not to lose faith, as cities express increasing interest in developing infrastructure for air taxi systems. This growing enthusiasm from urban centers to embrace air taxis as a transportation solution adds to the long-term potential of the industry. Despite the obstacles, the eVTOL sector remains a promising frontier, beckoning investors with its transformative vision of sustainable aviation and advanced mobility.
Lilium N.V. (LILM)
Lilium, the German startup with a market cap of $0.43 billion, is actively working towards certifying its Lilium Jet air taxi by 2025. However, concerns surrounding the company's cash burn and liquidity have led to a significant decline in its stock price. To ensure its operations until 2024, Lilium urgently needs to raise funds.
According to their recent filing, Lilium aims to raise $300 million for the first manned flight and a total of $540 million until certification in 2025. The utilization of predelivery deposits and the declining stock price pose uncertainties for the company, potentially impacting its NASDAQ membership. While a reverse stock split could be considered to boost the share price, it is generally viewed unfavorably by investors.
Joby Aviation (JOBY)
Joby Aviation is an American aerospace company , their innovative aircraft design features six tilting rotors, enabling vertical takeoff, landing, and smooth transition to forward flight. Through partnerships and successful test flights, Joby Aviation is advancing towards commercialization and revolutionizing urban mobility.
As of May 2023, Joby Aviation holds a market capitalization of $3.61 billion, solidifying its substantial presence and valuation within the aerospace industry. Notably, in 2020, Toyota played a key role in Joby's Series C funding round by leading the way with an investment of $394 million out of the total pledged amount of $590 million. This strategic investment from Toyota not only provided crucial financial support but also resulted in Toyota acquiring a minority stake in Joby Aviation, fostering a collaborative partnership between the two companies. As part of their collaboration, Joby and Toyota share a vision for the advancement of eVTOL aircraft and the future of urban air mobility. Joby has outlined its commitment to completing the type certification process by late 2024.
Volocopter
Volocopter, the German startup focused on electric VTOL aircraft and air taxi services, has raised $170 million in funding to support its forthcoming commercial launches in cities like Singapore, Rome, and Paris. With this first closing of its Series E funding round, the company is now valued at $1.87 billion post-money. Led by WP Investment and backed by strategic investor Honeywell, along with Atlantia, Whysol, and other existing investors, Volocopter's total funding to date stands at $579 million. With plans to commence commercial flights by 2024, Volocopter's progress in the autonomous vehicle space has been notable since its first autonomous flying car test in Dubai in 2017, supported by significant investors such as Intel and Mercedes-Benz.
EHang (EH)
EHang's eVTOL aircraft stands out for its innovative features and design. It is equipped with multiple rotors distributed across its body, providing redundancy and enhanced safety. The aircraft incorporates autonomous flight technology, enabling it to operate without a pilot on board. Passengers can enjoy a comfortable and spacious cabin with panoramic views.
EHang market capitalization of $0.6 billion and in its earnings report for the fourth quarter and full year ended December 31, 2022, EHang disclosed sales of CNY 15.68 million, a significant increase from CNY 8.7 million in the previous year. However, the company also reported a net loss of CNY 109.88 million, slightly higher than the CNY 105.42 million loss recorded in the corresponding period a year ago. These financial figures reflect EHang's ongoing efforts to expand its market presence and develop advanced AAV technologies in the rapidly evolving aviation sector.
Conclusion
In conclusion, the eVTOL industry holds great promise for revolutionizing urban transportation with efficient, autonomous, and eco-friendly air travel. While facing challenges in funding and certification, companies like Lilium, Joby Aviation, Volocopter, and EHang are actively shaping this industry's future. With increasing market valuation and significant investments, the global eVTOL market is projected to experience substantial growth. Despite obstacles, the industry's transformative vision and the growing interest from cities highlight the long-term potential of eVTOLs in advancing sustainable aviation and urban mobility.
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