Silicon Valley-based air taxi firm Archer sees more defense demand in near term
By Leen Al-Rashdan, Guy Johnson and Kate Duffy, Bloomberg
Electric aircraft maker Archer Aviation Inc. expects its defense-related sales outstripping commercial air taxis in the short term.
“In the near term the defense side could certainly become the biggest part of our business” as passenger services take time to scale up, Chief Executive Officer Adam Goldstein said in an interview with Bloomberg TV at the Paris Air Show. Shares in Archer rose as much as 7.6% in premarket trading on Monday.
Air taxi developers have pivoted toward defense as delays slow progress toward consumer services. At the same time, there’s been rising interest in new technologies for defense, with US President Donald Trump ramping up military spending and backing away from environmental commitments that powered the initial flood of interest in all-electric aircraft.
“There’s a renewed focus on defense right now and a renewed focus for innovation in the defense industry,” Goldstein said Monday. “We have spent a lot of time and effort there and I do believe it will be a very substantial part of our business in the near term.”
Archer partnered late last year with weapons maker Anduril Industries Inc. to build a hybrid-fueled military aircraft.
The UK’s Vertical Aerospace Ltd in May said it planned to develop a hybrid aircraft, also targeting investment from the defense sector. The variant could become more popular than the company’s all-electric VX4 aircraft, said Vertical Chairman Domhnal Slattery.
“It’s going to be a big, big seller for us,” he said in an interview at the air show. “All of the major European defense spenders are interested.”
Makers of electric vertical take-off and landing aircraft, who also include Joby Aviation Inc., “will need to expand into defense, cargo and hybrids as our analysis finds that fewer than 30,000 air taxis could be flying by 2040 — an unprofitable level that’s short of other projections,” Bloomberg Intelligence analysts Francois Duflot and George Ferguson wrote in a May 27 note. “For some, product development could burn cash in the near term.”
Santa Clara, California-based Archer won its first major defense contract in 2023, saying it expects to provide the US Air Force with eVTOLs that will be a quieter and cheaper alternative for delivering supplies and other non-combat uses.
–With assistance from Subrat Patnaik.
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