United Airlines places deposit for 100 flying taxis from Archer Aviation

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Archer Aviation Inc. (NYSE:ACHR) announced a $10M pre-delivery payment from United Airlines (NASDAQ:UAL) for 100 electric vertical take-off and landing (eVTOL) aircraft.

The deposit follows a purchase agreement inked in 2021 and adds to visible interest among airline operators in eVTOL aircraft. Indeed, in July air taxi company Vertical Aerospace (EVTL) reached an agreement with American Airlines Group (AAL) for 50 aircraft.

“This announcement marks a new important phase in our relationship with Archer, and our commitment to eVTOL technology,” Michael Leskinen, President of United Airlines Ventures said. “We are witnessing an inflection point where consumers, businesses, and policymakers are all aligned to prioritize technology that reduces the impact of climate change.”

He explained that eVTOL technology could help the carrier reach carbon-neutral targets while also helping the airline aid consumers with “commutes within cities across the globe.”

Archer Aviation (ACHR) shares surged 6.89% in premarket trading on Wednesday while United Airlines (UAL) stock rose 2.2%.

Read more on Joby Aviation’s expanded contract with the U.S. Air Force.

Comments

[Moats and Income]

Shame they don’t own their IP….stay away from this legal mess…

[MisterPeter]

The logic for short-haul electric airplanes/flying vehicles is there. They should be cheaper to maintain and operate than turboprops and much cheaper than small jet planes. They can also be "refueled" within 30-45 minutes - the minimum turnaround at most commercial airports. This isn't some woke fantasy but based on sound economics.
On the other hand, there are a couple of HUNDRED start-ups in this space. Ultimately only a handful of them will be successful - not the kind of odds I'm willing to take.

[richjoy403]

I see we still have many naysayers who refuse to acknowledge electric planes (likely beginning with short haul taxis) are obviously under development for future delivery--but those persons likely also refused to acknowledge other technology improvements of the past 25 years (Tesla's first electric cars; autonomous cars; stem cell research; gene editing; MRI; digital camera; cryptocurrency; etcetera). Time and technology march on...

It's also obvious private capital is investing heavily in the many flying taxi startups (and also electric airplanes), as are airlines willing to confirm their future vision with orders for future delivery.

IF I were interested in holding shares of an airline, I would expect more airlines to join United.
-----------------------
"Aviation company Wisk announced yesterday that it is receiving a $450 million investment from Boeing as it works on its sixth-generation electric air taxi." www.popsci.com/...

"In a January [2021] report, consultancy Deloitte estimates the US market for [eVTOL] will be worth $115 billion annually by 2035, with passenger and cargo operations each accounting for about half. More than 200 companies globally are developing eVTOL aircraft, and private eVTOL players had invested $2 billion in such projects as of September 2020". www.flightglobal.com/...

"Investors pledge a record $4.3bn for air taxi start-ups" Aug 2021 www.ft.com/...

[MachineLearning]

Not my $. They can get it via government handouts but I will not willingly give to this company.

[ilovebacon]

This is nothing more than climate change hysteria virtue signaling. The odds are solidly in favor of these aircraft, if they ever are mass produced, never flying for a major airline. All we know from this is United thinks it’s worth $10M to help keep the rabid greenies at bay.

[Mountainbarony]

@ilovebacon nothing more than the future coming at you......ready or not.

[ilovebacon]

@Mountainbarony hardly. We are many decades away from electric airplanes being a long-term, viable option. With current tech a true commercial aircraft would have to carry several times it’s weight in batteries to match the performance of turbine powered aircraft. Given that we are not seeing monumental leaps in battery tech, I will say again, this is another desperate attempt to keep at bay those that worship at the alter of climate change hysteria.

[User 56360468]

Why is it pious wealthy liberals in big coastal cities think that Bubba in Texarkana, TX is literally murdering the whales and killing the planet by driving his 2005 F-150 to and from the factory every day, but it's okay for them to take private planes across town or to Davos to lecture Bubba and his fellow diesel pickup truck drivers?
Try taking mass transit next time.

[jackmaster20]

When will Archer deliver the first electric taxi to United.......????

I think its a bad use of funds for United to pay $10 million to
a start up with an idea. Especially since United had to lever its
balance sheet in 2020 due to Covid AND while they still are
having difficulties recruiting pilots and ground staff in the face
of current flight cancellations.

In the summer of 2022 United should be funding operating
improvements and maximizing cash flows instead of giving away
cash for 2050 taxi ideas.

Do United customers really care about electric taxis when they
are at the airport being informed their flight has been cancelled...?

Management arrogance.

[cajuncowboy]

I think I will stay on the ground before flying in an electric plane