- Joby Aviation, which promises to build and operate a public fleet of aerial taxis by 2024, will begin trading Wednesday, testing the imaginations of commercial investors.
Since its founding in 2009, Joby has raised the likes of Uber Technologies Inc. and Toyota Motor Corp. on its plan to design a new kind of passenger drone and has sold more than $700 million in private capital. A merger this week with a special purpose acquisition company will bring more than double that amount.
Joby is the largest among a group of upstarts which also includes Volocopter GmbH and Beta Technologies Inc. They're going against Airbus SE, Boeing Co. and Lockheed Martin Corp. by seeking to leverage breakthroughs in battery technology to create a more environmentally friendly form of urban transportation free from earthbound traffic. Can anyone manufacture science-fiction, make it a reality, or just the most basic model?
The rise of SPACs since 2013 has enabled a new breed of stock to be listed on the most elite exchanges. The process allows companies, some with no revenue whatsoever, to raise capital from investors who signed a blank check and bypass the scrutiny associated with an initial public offering. Aerospace companies have been an especially eager adopter of the model.
Joby will get $1.6 billion in new financing for the merger with a SPAC named Reinvent Technology Partners. In anticipation of the deal, Joby rapidly accelerated hiring and now employs more than 800. It demonstrated what it calls a final aircraft design to two Bloomberg reporters in June and said it would begin manufacturing the vehicles next year. Joby said last month it accomplished a flight of more than 150 miles on a single charge. The company has been working with the U.S. Federal Aviation Administration for several years and expects to achieve certification in 2023. As it works toward that goal, it will begin training pilots to operate five-seat crafts.
A great deal of hype surrounds flying cars. Morgan Stanley has estimated that the market for electric vertical mobility will be worth $1 trillion by 2040. But a regulatory green light is far from assured, said Robin Riedel, a McKinsey Co. partner who leads the firm's aerospace practice. The first-time approval from the FAA for novel aircraft can face delays of a year or more, he said. 'Every certification is a risk until someone has actually done it, he said. 'The Devil is in the details,' says William Clarke.
How do I take off and land from places? This year, Joby struck a deal with SoftBank-backed Reef Technology Inc. and Neighborhood Property Group to gain access to the roofs of some parking garages and other buildings in North America and Europe. Joby expects to install helipad and charging stations at those sites.
Joby plans to develop taxi service through partnerships. This investment company, which is both a major investor and partner after selling its own car unit to Joby late last year, has said that it will provide Joby's air service to its customers and the Air Service will provide ground transportation to Joby departure and arrival sites. In what will be one of three public displays of the aircraft, Joby will park one at the NYSE building Wednesday morning.