Germany’s Lilium strikes $1 billion eVTOL deal with Brazil’s Azul airline

Lilium eTVOL planes

German electric take-off and landing (eTVOL) craft manufacturer Lilium has announced an expansion of its global advanced air mobility activities (AAM) to Brazil through a partnership with local airline Azul. The agreement calls for Azul to buy and operate Lilium eTVOL planes in a deal valued at $1 billion.

Lilium eTVOL planes to make up new AAM commercial network in Brazil, region

The crux of the accord calls for Azul to purchase, operate, and maintain 220 Lilium eTVOL planes in a new network in which both companies will participate. That structure, whose launch is planned for 2025, calls for Azul to use its traditional airline experience to run the e-flight service, and Lilium to provide aircraft health monitoring platform, new batteries, and custom replacement parts. Munich-based Lilium called the move a big step in its international AAM development, with the Brazilian market boasting over 100 domestic air travelers per year, as well as a huge civilian helicopter and business jet activity.

Central to the new cobranded Brazilian electric plane company will be Lilium’s 7-Seater Jet, an emissions-free craft designed for regional routes between 40 kilometers and 200 kilometers, flying at top speeds of 175 mph. Given its homefield experience and advantage, Azul will play an active role in helping Lilium obtain certification in Brazil, and clear other regulatory hurdles. Lilium officials called the partnership ideal for ushering future AAM travel to Brazil and the wider region by a well-known air transport player like Azul.

“Azul has brought convenient and affordable air travel to underserved markets across the Americas and this makes them an ideal partner for Lilium,” said Lilium cofounder and CEO Daniel Wiegand. “We’re excited to work with Azul’s seasoned team to deploy a cobranded eVTOL network in Brazil.”

Azul CEO John Rodgerson agreed the pairing was well-synced to propel past transport success into the future.

“Azul is the largest domestic airline in Brazil in terms of cities served and daily departures,” Rodgerson said. “Our brand presence, our unique route network, and our powerful loyalty program give us the tools to create the markets and demand for the Lilium Jet network in Brazil. As we did in the Brazilian domestic market over the last 13 years, we look forward to again, now with the Lilium Jet, working to create a whole new market in the years to come.”

Expanding plans and ambitions may be relief to investors

Announcement of the Brazilian eTVOL platform follows Lilium previous plans to launch AAM services across Europe and the US. Those expanding ambitions may provide timely reassurances to investors.

Most of those have been pouring funds into exciting and impressive future transport technologies and services that – for now – largely exist in the computer generated imagery of electric craft companies. Indeed, few actors in the field have achieved what Joby, EHang, and Volocopter have in producing and flying craft for people to see aloft. 

Concerns about the still theoretical nature of some AAM projects was thought to have been responsible for Archer recently scaling back targets for its planned stock market flotation from $2.7 billion to $1.7 billion. Archer is planning to introduce its shares through a merger with Atlas Crest Investment – the kind of special purpose acquisition company (SPAC) that many critics call Wall Street’s latest speculative get-rich-quick gadget. SPACs, skeptics claim, are based on selling expensive stakes in young businesses boasting big but untested ideas for the future – tantamount, they say, to enormous bets on whether those schemes come to fruition down the line.

Given the recent market cooling on Archer, then, Lilium’s link-up with Azul may have provided financiers with cause for reassurance. The company has received $300 million in development funding from investors so far, but is planning a SPAC merger of its own. That will seek to raise $800 million in new capital, and lift Lilium’s total value to $1.3 billion. 

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