American Airlines invests in electric flying taxis

The airline plans to invest $ 25 million in Vertical Aerospace Group Ltd., a UK-based electric aircraft startup.

The world’s largest airline by traffic said it would buy up to 250 of Vertical’s planned flying taxis as airlines and financiers seek to support the nascent technology, and its partners in the company will take potential orders to 1,000.

American said the aircraft, which is electric and takes off and lands vertically like helicopters, could take customers to congested cities to get to and from airports. But that could be a long way off: Vertical plans to conduct the first test flight of its VA-X4 jet later this year, and American’s order hinges on the plane’s approval by regulators and other milestones.

Vertical said its plane will seat four passengers and a pilot and fly at speeds of up to 200 miles per hour with a range of more than 100 miles. Vertical said it aims to start commercial operations in 2024 once European regulators approve.

A prototype of Vertical’s flying taxi was demonstrated at Cotswold Airport, near Kemble, Britain, in June 2018.


Photo:

GF Williams / Milltown Partners / Reuters

Several companies are trying to develop and sell electric flying taxis, with Vertical being the latest to go public by merging with a blank check company.

Embraer TO

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it said on Thursday it is in talks to combine its air taxi arm with a special purpose acquisition company, or SPAC, and this week announced a deal to sell up to 200 of its flying taxis for use in the UK market.

Vertical said Thursday that it will go public through a combination with a SPAC in a deal that values ​​the combined entity at $ 2.2 billion. The company’s other investors include large manufacturers such as Honeywell International. INC.

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and Rolls-Royce Holdings PLC., along with Microsoft Body

MSFT 1.44%

venture capital fund, Vertical said.

Avolon, an aircraft leasing company, agreed to reserve up to 310 aircraft from Vertical with an option for 190 more. Virgin Atlantic has options to buy between 50 and 150 planes. American’s deal also includes options to buy an additional 100 planes. Vertical said it would work with American on passenger operations and infrastructure development in the US and would explore a joint venture with Virgin Atlantic in the UK.

The airlines’ investments and orders are part of a broader effort to drive the development of new and more efficient aviation technology as they seek to reduce their carbon footprint.

Virgin said the Vertical plane could help reduce travel from towns and cities outside London – the 56-mile journey from Cambridge to London Heathrow Airport, for example, could be cut to 22 minutes from an hour and a half by car.

United Airlines Holdings INC.

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in February it announced plans to back another electric flying taxi startup and buy up to 200 of its planes. On Thursday, it said it is forming its own venture capital fund to invest in early-stage technologies that advance its sustainability goals.

Boeing Co. Chief Executive David Calhoun said the aircraft maker had continued its investment in flying taxis, citing the opportunity to displace existing urban helicopters while reducing noise and carbon emissions.

“There is a huge market for urban helicopters that wants to be replaced as quickly as possible,” he said at an analyst conference earlier this month. “It is measured in billions. It is not a tiny niche. “

American’s move is also the latest sign of the airline industry’s marked turnaround as the coronavirus pandemic recedes. Airlines grounded planes and cut flights last year and buoyed roughly $ 54 billion in aid from the government that paid for workers’ wages and benefits. American, which entered the pandemic with more debt than its rivals, lost $ 8.89 billion in 2020.

Now domestic travel is picking up and carriers say they expect operations to start generating cash again this summer.

Write to Alison Sider at [email protected]

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