Podcast: Beyond The Hype—What’s Happening With Air Taxis

Ben Goldstein:

Hi. Welcome to Aviation Week's Check 6 Podcast. I'm Ben Goldstein, managing editor of Aviation Week's AAM Report. And today we're going to be taking a look at the progress underway in the fast-growing advanced air mobility industry. Joining me are Graham Warwick, executive editor for Technology at Aviation Week, Jens Flottau, executive editor for commercial aviation, and Sergio Cecutta, founder and partner at SMG Consulting.  

So, as many listeners probably know, leading makers of electric vertical takeoff and landing aircraft or eVTOLs such as Archer, Beta Technologies and Joby are pushing forward on their roadmaps to type certification. But how far from the finish line are. It seems like they all have different ways of tracking their progress. So, what is the real story? When will we see type certified eVTOLs? Sergio, would you like to get us started? 

Sergio Cecutta:

So, I think it's a little bit of a nuanced answer. One of the things that has happened is because the companies have found a speedier way to market with turning to service in the United Arab Emirates. And so now we need to look at when are they going to get certified and enter service in the region versus when are they going to get certified, for example, in the us. U.S. One of the goals of UAE is to get these aircraft in the market to the population in service. And so what we will see is probably toward the latter part of this year, we'll see tests of this aircraft in UAE with an entry into service that probably is going to be sometimes in the middle of next year. When it comes to the U.S. this year it’s just going to be a year of companies working on their progress.  

We still haven't seen any conforming aircraft. Whatever conforming means right now, it's going to take time before TIA is assigned by the FAA. So, I would say on the U.S. front, do not expect a lot of progress. It's probably going to be late ‘26, maybe even ‘27 when it comes to entering into service. Last but not least, if we talk about Europe, it's a little bit now. Two of the European big companies, Lilium and Volocopter are in dire straits. It's still a question mark, even with Lilium having received new capital, new ownership. And then last but not least, I would say when it comes to Vertical, new financing, new management, but at the same time I think it's still going to take time to stabilize. So we won't see anything coming out there for quite some time.  

Ben Goldstein:

Graham, does that track with what you're seeing in your reporting?  

Graham Warwick:

Oh yes, very much so. I think we need to be very careful to advise the listeners to be skeptical on what they hear this year. That's going to be progress claimed isn't the right word, but the way this industry is working because it's largely private equity venture funded, is that they're salami slicing the certification process the way we've never seen before. Airbus and Boeing don't do this. I mean they don't give us every small step in the certification process. So, you see that you're getting a lot of these steps along the way that really aren't major milestones. They're just another step along the way. And what happens is you get a flurry of headlines saying that they've passed this milestone or something and the share price goes up for a few days and then it goes back down again. And so you need to really understand that the only thing that matters as we stand today is flying aircraft for which they can get certification credit for the testing, right?  

They have to get aircraft flying, but every hour those aircraft fly counts towards certification. We're not there yet. We're not there with anybody really. And this is a process that Sergio will tell us what it is. But this is a process that would normally take for the first flight through to certification, 12 months, 18 months. These are different types of airplanes. We've never flown these airplanes before. They only fly for 15, 20 minutes at a time. They're going to have thousands of these very short flights to do all the testing they need to do. But that is what matters. Nothing else matters. TIA of a cockpit is a step, but it's a small step and it doesn't matter until you fly conforming aircraft. So, we are not going to see any aircraft certified in the U.S. or Europe with one possible exception. We should see it next year if there's no showstoppers that emerge as we go along.  

The one exception is Volocopter, and Jens will talk to this, but they were getting close to certification when they ran out money. We don't know if they get an investor, we don't know what basis that investment will be made. Their initial airplane is not economically viable. Any new investor I would think would put the focus on a more economically viable aircraft. They had a bigger airplane in the plan when they went into insolvency. So, they may come back in a different form, which means that certification has changed in some way. We just don't know what going to happen there. Europe, by and large, if you look across Europe, and again Jens will talk about this, they've lost two years. They were in a leading position at one point, the Europeans. So the regulator was really leaning forward to help the industry and then they ran out of money and they've all lost at least two years on the original plan. ‘28 is the earliest we'll see any European airplane certified and it may even be later than that. So, there's a big gap opened up between the U.S and Europe on that. But just be really careful what to look for is flying type conforming, however they describe it. These are aircraft that you fly for credit. That's all that matters this year is flying those airplanes. Once those aircraft are flying, the clock is running to certification  

Ben Goldstein:

Jens, I want to bring you into the discussion now. So, Sergio and Graham have both mentioned a situation in which European eVTOL companies appear to be falling behind their U.S. counterparts. So, how severe do you think this divergence has become and is that gap widening?  

Jens Flottau:

I think it's very severe. I mean, there's basically three cases right now that we have to watch. One is Airbus. They haven't really, I mean they've been in a kind of a different league because they're Airbus, but they've been engaged  just to keep track of things. But they've decided to officially pause the city Airbus project. I don't know whether pause is the right word. I'm also not sure whether the reason they've given officially, which is the lack of progress on battery technology is the only reason, could be the concept that's not working or I'm personally not really clear what their strategy was in the first place.  

But of the new startups, the new companies obviously and the focus over here are Volocopter and Lilium and both are in solvency. And if you ask me for both, it's still not looking good. Volocopter has until the end of February to find new money. If they don't find money by then, this could be the end of it. And as Graham mentioned, they have, they're probably the most advanced in term in terms of certification. But the big question is of what? Of the two seater that's not commercially viable. So any new investor that looks at putting money into Volocopter will have to look at a much longer horizon, which includes the four seater, which is the commercially more viable or viable product. And then we're not talking months until certifications at the end of this year, but several years as Graham says. Now on the Liliumn side, things seemed to be getting worse every day.  

There was a big sigh of relief over Christmas when the new consortium appeared on the surface and affirmed to everyone that they put in $200 million, which would obviously buy the company more time. But since then, we haven't heard much. The latest we've heard is that wages for January haven't been paid, that there are some sort of roadblocks that are keeping the participants in the investment consortium from putting their money in, from transferring the money. And obviously time is of the essence. There's lots of highly skilled workers that want jobs that will probably find good jobs elsewhere. There's the whole supply chain that is waiting to see progress and that will not wait forever. So as optimistic as people had been a month ago, a month and a half ago, I'm not so sure this will work out well in the end. It could change any day. We could see big news tomorrow, everything's sorted, money is there, the company will continue, but it could also go the other way still. And again, Lillian, big question, the $200 million I would say just, my personal opinion, that's not nearly enough to get them to where they need to be in the end certification, it'll be a lot more. And people putting money into the company will have to be aware of that.  

Ben Goldstein:

So, we've been talking about certification, but I want to turn to production. These companies talk a big talk about churning out hundreds or even thousands of aircraft per year, but how much production progress is really being made. Sergio, do you want to get us started?  

Sergio Cecutta:

Sure. So, one thing that we need to note is that different companies are following different strategies when it comes to production. You take for example, Joby, that is fully vertical integrated and that is going to be very different than other companies that are relying on suppliers. Now, one of the things that we need to say is that scaling in aerospace, it's not easy and it is always a byproduct of support from the supply chain. We know that both in Europe and in the U.S. the large OEMs on their transport side have found it not easy to scale production. And the last thing that we need to bring to bare is the fact that in aerospace we've made very few things in the hundreds or high hundreds a year. And so when you hear thousands of this vehicle, while it is unheard of, it is not impossible.  

The last time we were making things in the thousands was about 80 to 90 years ago. So ,what I would say is one of the things that we need to look at is how much time it takes to scale these facilities. And what I would say is if you just want to get a way to look at these things, you would've to have a little prototype line where you are troubleshooting your process for building this aircraft, making it repeatable, taking out anything that might be duplication, anything that might be waste until you've got to a process that you think it's good enough, will be deemed good enough by the certification authority. And FAA works slightly different. EASA wants you to have their approval before you start production of even the type conforming aircraft. In the US it's a little bit different. The PC, this production certificate comes after the certification and at the beginning you will be producing two airplanes, four airplanes until one of the milestone to look for is this one airplane a month.  

And so some of these claims where you say, well, right now I haven't even built one airplane. And then in a few months, or in a matter of double digit months, but short amount of time, 12 months, 14 months, you can start building an airplane eight a month, two airplane a month. It could be a timeline that is too aggressive to be real. And the second part, as we were mentioning before, is it doesn't matter what plans the OEM makes, it's whatever the supply chain can support. And that I think it's a very important piece in general when it comes to production. We know that at the very beginning, this market is going to be supply limited because we want to not make a lot of these airplanes. And so it’s going to take time. And then the last thing that I would say is we need to be careful with looking at plants versus the capacity of a plant. So just because a plant or a building can produce up to a certain number of airplanes, that doesn't mean that that is the capacity that is installed. For example, if you look at the, for a good example, the Taubate line of Eve in Brazil, they will have the same module that will be repeated multiple time as production scale, but at the start is only going to be one module that is different than the full capacity of the entire plant.  

Ben Goldstein:

Graham bringing you back in, it's interesting that Sergio just mentioned that initially he expects to see low numbers of aircraft being produced. So I'm wondering what do you think initial early operations of these aircraft may look like? When do you think we may actually see these things flying around and where will they be and what kinds of flights will they be operated on?  

Graham Warwick

Yeah, so I think a good example of what Sergio is talking about is Beta Technologies. Beta opened its factory, it's brand new manufacturing plant in October 2023. And they rolled out the first aircraft out of that plant was I think in November last year. And that was not a conforming airplane, that was a demonstrator airplane. So Kyle Clark, the CEO was talking at...and he said inside that building, they have two lines. They have one line that's making conforming aircraft, i.e., every step of the production is documented and approved by the FAA. And he said basically they sit there with a file of documents next to the aircraft until the FA signs it off and it moves to the next stage. So it's moving at a very slow pace because these are FA monitored oversight, conforming aircraft. The other side of the building, they're building demonstrators to the same standard, same equipment, same pieces.  

Even the subsystems are conformed, but they're not going through the FAA conformance process because they're demonstrators. So that's the first one off the line. There's a few more that can come out the line and what they've got planned pretty much to do this year. Now these are conventional-takeoff-and-landing electric aircraft, but it's the same airframe as their eVTOL, which is coming along a year or so later. So, their aircraft are going to roll off the line and they've already got about half a dozen different demonstrations that they've announced. They've got demonstrations in the U.S. medical delivery with United Therapeutics, they've got Bristow in Norway on cargo, Japan, Dubai. So, these aircraft are going to come off the line and they're going to go off and do these customer demonstration flights. And then you go over to Joby, which is a pilot line and Joby, I don’t know, it's about every one aircraft, every two or three months coming off the pilot line at the moment.  

And again, what you're seeing is, the aircraft are going into demonstrations, they're going to the Air Force to do demos under agility Prime or they're going to go to Japan. They've gone Korea to do demonstrations. So, what this year is going to be about is the one track, which is certification and the other track which is customer demonstrations for which you do not need a certified airplane, you need an airworthiness approval, but it's the experimental approval. So towards the end of the year, it's entirely feasible if the UAE is going to stay on the track that it wants to stay on and launch commercial service early in 2026, early to mid 2026, they may start flying in country towards the end of this year, but it'll be under a special permit to fly that allows them to fly non-certified airplanes. They may even get permission to do market survey flights where you can sort of fly typical routes between vertiports to actually show the mission.  

Whether that includes flying passengers or not, I don't really know. But if they do any flying, it will not be commercial for-hire passenger carriage. It will be some form of demonstration, some form of a special operation where there is a specific permit written that allows them to do that type of operation. So, we will see a lot of that through this year. And that's generally just across electric aviation. There's a lot of demonstrations that are planned throughout 2025 in electric aviation writ large. So, we will see a lot of activity. But you've got to remember, those airplanes are not certified airplanes. Those are airplanes that are built as demonstrators. They may have everything in that airplane that's planned for the production airplane. It just has not gone through the FAA thought or the EASA approval process. They are aircraft specifically designed to go into a pilot operation or demo or something like that. So that's what we'll see this year. And then that might phase in. If that sticks to that, we might see it phase into something in UAE early in the next year.  

Ben Goldstein:

Great. Well, I think we have time for maybe just one more question. I want to let you have the last word, Sergio, with SMG consulting, Sergio issues one or two or several high-level predictions at the end of each year. That was the case also last year. So, I'd love to hear Sergio, maybe one or two of those high-level predictions and what you would expect to see in 2025.  

Sergio Cecutta:

Sure. So, it's been a tradition. I think we always go out on a limb and we try and say what's going to happen this year. I think if we look back at what we said the beginning of 2024, I think it shows how the industry needs to go through a lot of work to get these airplanes out. And so it's a lot of the things that we predicted last year, we're kind of seeing these hopefully happen this year. I think when it comes to certification, really as Graham was mentioning, the outlier would be Volocopter. It could be—It all depends on the amount of money that they will receive. And I think also Jens made a very good point to say if a new investor comes in, would they want to finish the Volocity program or say we should concentrate on the more economical machine that would be this larger aircraft.  

We haven't talked about China. I know that we can have an entire podcast on China. It's a fascinating market right now. And there could be some certification, there will be some certification there as well as some entering into service. And I think that that was our first prediction. I think what's worked, it's also touching on what I call the goodbyes of the industry. So, we have seen during the course of last year Overair completely liquidating. And I think we need to be careful now how we refer to these things because companies are going bankrupt. But bankruptcy, it is not a permanent death. It is just going into the ICU that could lead to the morgue, but we're not there yet. But I think that as we have seen that company fail, we will need to look busier at who we left the wherewithal to continue.  

And what we have seen last year is that more money is going to the same players because there are those players that are progressing as opposed to the others. And then we have many, many, many other companies that are slowly coming along, but a lot of money is needed. So one of the things we showed at one of the latest conferences was we looked at 60 different advanced air mobility players and for each one of them we looked at how much money they raised and forecasted and how much money they need to certification. Well, there is a $40 billion gap between where we are now and the money that we need for all of them to certify. And so that means that look for cash as the indicator when it comes to what's going on. Last, but not least, to put a bow on it, I think we will see a lot of airplanes that hopefully will get conforming aircraft, whatever conforming aircraft means, as Graham mentioned. But the regulator issuing this TIA, what we call a TIA for flight credit, that means, as Graham was mentioning, you have an inspector from the regulator in the airplane with the OEM doing tests and we think that there will be a few airplanes receiving this TIA across the whole world.  

Ben Goldstein:

Fascinating stuff, Sergio. Well, I think we're about out of time, but I want to thank all three of our guests, Jenz, Graham, and Sergio for your fantastic insights. That's a wrap for this week's Check Six. A special thanks to our podcast editor in London, Guy Ferneyhough. Anyhow, thanks for listening and have a great week. 

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