Remember the grubby flying taxi Bruce Willis drove in "The Fifth Element"? That was a very 90s view of the future. In reality, we may soon be taking up to 60-mile rides in sleek, elegant, and perhaps most importantly, emission-free electric planes.
Media reported this week a California-based startup called Archer was going public through a deal with a special-purpose acquisition company. SPAC deals are becoming increasingly popular, especially in the electric vehicle area, as a much quicker way to raise money on the stock market than traditional initial public offerings.
Archer, which has developed a vertical takeoff and landing aircraft (eVTOL), is expected to be worth as much as $3.8 billion after the deal with Atlas Crest Investment Corp. The deal itself is seen to raise $1.1 billion for the company.
And this is not all. United Airlines has already ordered $1 billion worth of eVTOL aircraft, with production set to begin in 2023, after the Federal Aviation Administration certifies the aircraft.
Besides United, investors in the startup include the newly merged Fiat Chrysler and Peugeot Citroen, which now call themselves Stellantis, as well as the UAE's state investment company Mubadala. Investment banker Ken Moelis and several funds are also among the backers of Archer's technology.
Making an electric plane has been a major challenge for a transportation industry that is now urgently seeking to decarbonize under pressure from governments and environmental groups. Air travel is among the biggest emitters, and a recent report from British researchers even went as far as to suggest that people should stop traveling by plane so we could phase off air travel by the middle of the century as a way of reducing our carbon footprint.
The main problem is fitting the aircraft with batteries that can keep it in the air long enough without making it too heavy. Small aircraft with a relatively short range appear to be a lot more realistic bet on all-electric technology than airliners, at least for the time being. And the promise is great.
"It's pretty incredible to think how big this market can be," the co-founder and co-chief executive of Archer, Adam Goldstein, said, as quoted by CNBC. "The partnership with United really gives us a chance to get to market first and really helps us accelerate our timeline."
"Part of how United will combat global warming is by embracing emerging technologies that decarbonize air travel," said the chief executive of United, Scott Kirby. "By working with Archer, United is showing the aviation industry that now is the time to embrace cleaner, more efficient modes of transportation. With the right technology, we can curb the impact aircraft have on the planet, but we have to identify the next generation of companies who will make this a reality early and find ways to help them get off the ground."
According to the airline, Archer's aircraft could save 47 percent of emissions per passenger on the commute between Hollywood and LAX—one of the first locations where Archer plans to use its aircraft.
The promise is great, and so is enthusiasm. However, Archer has yet to release a photo of its aircraft in full scale and show footage of it in action, as it were, eVTOL.com has noted. What's more, certification from the FAA may take longer than the company and its backers hope, based on evidence from previous certifications of aircraft with a novel design. Yet electric aircraft's entry into the transport mix seems to be only a matter of time, especially in a world stepping firmly and confidently on the path to lower, if not zero, emissions.
By Irina Slav for Oilprice.com
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