The Pentagon Is Now the eVTOL Industry’s Biggest Customer. Here’s How Much Revenue That’s Actually Worth to Archer and Joby.
It’s no secret that electric vertical take-off and landing (eVTOL) companies like Joby Aviation (NYSE: JOBY) and Archer Aviation (NYSE: ACHR) face years of cash outflows before they become durable businesses. These pressures, exacerbated by any delay in Federal Aviation Administration (FAA) certification of their eVTOLs, mean that any potential for relatively reliable up-front revenue is a major lift for both companies. That’s where the Pentagon comes in.
Joby and Archer understand that generating revenue from eVTOLs will take time. For reference, the two companies are not exactly an apples-to-apples comparison, with Archer more of an original equipment manufacturer (OEM) while Joby Aviation’s plans are more ambitious. It plans to build, own, and operate its eVTOL as part of a vertically integrated transportation-as-a-service (TaaS) business similar to what Tesla is aiming for with its robotaxi rollout. The distinction is not absolute: Archer will run a service, and Joby will sell to third parties, but there is a difference in their core businesses.
However, the two companies have a lot in common. They are both developing autonomous eVTOLs to be able to offer lower-cost flight in the future, and they are both awaiting FAA certification for their eVTOLs, maybe as soon as next year. In addition, both are hoping for early revenue from their eVTOLs, which airlines can use to transport passengers to airports as part of a seamless travel experience. Indeed, it’s no accident that Joby has investment from and a partnership with Delta Air Lines, and Archer has a partnership with United Airlines.
Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.