The Growing Market for eVTOL Aircraft
Archer Aviation and Boeing settle litigation and announce investment, driving advancements in the eVTOL market. FAA grants airworthiness certificate for Midnight aircraft.
The market for electric vertical takeoff and landing aircraft, known as eVTOL, is on the rise as prominent manufacturing and aerospace companies enter the scene.
On Thursday, Archer Aviation (ticker: ACHR) and Boeing (BA) revealed that they had reached a settlement agreement. While most of the terms remain undisclosed, it is noteworthy that Boeing will be investing in Archer and providing them with autonomous flying technology from Boeing's eVTOL subsidiary, Wisk.
Archer has also attracted investments from other major corporates, demonstrating a positive outlook for eVTOL adoption. Often referred to as "flying cars," these remarkable vehicles offer a quieter and more sustainable alternative to traditional helicopters, operating solely on batteries. This paves the way for potential air-taxi services in urban areas.
The resolution of the litigation between Wisk and Archer is undoubtedly beneficial for all parties involved. Archer secures the funds it needs, Boeing establishes a stronger presence in the startup realm, and both companies can lay to rest a legal dispute that had lingered for years.
+------------------------------+ | Total New Capital Raised: $215M| +------------------------------+
"We are pleased to have reached a mutually agreeable settlement. We're focused on supporting Wisk and are excited by their continued progress toward certifying and bringing to market the first all-electric, self-flying air taxi in the U.S.," stated a spokesperson representing Boeing in an email. Boeing's investment in Archer will further support the potential integration of Wisk's autonomous technology in future variations of Archer's aircraft.
Archer, however, has yet to respond to a request for comment.
Despite this development, Archer shares experienced a positive trend, opening on Friday at $6.86, marking an increase of almost 18%. Although they later dropped slightly to $6.02 by late morning, the overall gain still stood at 3.3%. On the other hand, Boeing's stock saw a 0.5% decline, while the S&P 500 and Nasdaq Composite both experienced losses of 0.1% and 0.4% respectively.
In addition to the settlement news, Archer also made another significant announcement on Thursday. The Federal Aviation Administration (FAA) granted them a special airworthiness certificate for flight testing of their latest creation, Midnight. Midnight is a six tilt-rotor eVTOL aircraft, and there are hopes that it could be available for commercial service as early as 2025.
The flying-car trend has gained traction within big manufacturing and aerospace companies, as they see the potential of disruptive new technologies. Their investments not only serve as a testament to their belief in this industry but also increase the likelihood that flying cars will become a common sight in cities across the globe.