Lilium closes $240M financing round for jet-like VTOL
The Bavarian electric aircraft company Lilium has closed a financing round for more than 240 million dollars. The Chinese internet giant Tencent led the round. Other previous investors including Atomico, Freigeist and LGT also participated.
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The start-up company from Weßling near Munich intends to use the fresh capital for the further development of the Lilium jet and preparations for series production in the recently completed production facilities. The new plant, with a surface area of 3,000 square meters, is located directly next to the company’s headquarters in Weßling, where more than 400 people currently work. A second, even larger factory at the same location will soon follow. According to Lilium, the two plants will enable the company to produce hundreds of electric aircraft per year by the planned start of operations in 2025.
Lilium aims to position a fleet of electric aeroplanes in cities around the world by 2025. Specifically, they aim to operate their own Lilium jet fleet to establish an on-demand air taxi service, which the company claims should guarantee flights “comparable in price to a taxi, but four times faster,” thanks to a dense network of landing hubs. According to Lilium, trial operations at several locations will begin before 2025.
Technically, the five-seater VOTLs to be used will have 36 electric engines, be capable of speeds of up to 300 kph and have a range of up to 300 kilometres. Lilium says the aim is to connect entire regions in this way and not to limit itself to short distances within an urban area.
Meanwhile, the flight tests of the Bavarians are becoming increasingly complex: In September, Lilium published images on the occasion of the latest, completed phase of flight tests. These show the electric aircraft for the first time flying at speeds of over 100 kph and the transition from vertical to horizontal flight. According to Lilium, that part is “one of the greatest challenges of aviation”.
The jet celebrated its world premiere in May 2019, around which time Lilium also made its maiden flight with the aircraft. However, Lilium suffered a setback in March: One of the two electric air taxi prototypes was irreparably damaged in a fire. The fire broke out during routine maintenance inside the aircraft, and the cause is not yet known. Until this is clarified, no test flights with the second prototype will be undertaken.
In Europe, the startup has initiated the certification process for the VTOL in spring 2019. Also, Lilium considers the USA a key market with a large number of heliports and airfields, which is why Lilium also wants to gain a foothold there.
Before the current financing round, the start-up had already raised around 100 million dollars – Tencent was also involved at the time. In total, the Bavarians have now generated about 340 million dollars. Lilium CFO Christopher Delbrück emphasises that the new, additional financing “underlines the deep confidence of our investors in our physical product as well as in our business case”.
Update 10 June 2020: After the electric air taxi startup Lilium closed a financing round of more than 240 million dollars at the end of March, the Bavarian company has now been able to raise a further 35 million dollars (equivalent to 31 million euros) in capital from the investment company Baillie Gifford, as Lilium has now confirmed in an announcement. Baillie Gifford has so far invested in Amazon, Tesla, Airbnb, Spotify and SpaceX, among others, according to the announcement.
Together with the commitment of the British investor, Lilium has now raised 375 million US dollars. Lilium intends to use the money to further develop the jet and also to advance serial production in the newly completed production facilities.
“Baillie Gifford is one of the world’s most influential tech investors and their commitment to Lilium represents a significant vote of confidence in both our physical product and our business case,” said Christopher Delbrück, CFO of Lilium. There have recently been growing doubts about the “physical product” in particular – not only because of the fire, about which Lilium does not say a word in the current press release. At the beginning of this year there was strong criticism in Germany against Lilium that the promised dates could not be kept. Aeronautical engineers calculated that Lilium was calculating with an unrealistic efficiency for the important hovering flight.
Baillie Gifford is unimpressed by this. “While still at an early stage, we believe this technology could have profound and far-reaching benefits in a low-carbon future and we are excited to watch Lilium’s progress in the years ahead,” says Michael Pye, investment manager at Baillie Gifford, according to the Lilium announcement.