London-based electric vertical takeoff and landing (eVTOL) aircraft company Vertical Aerospace is getting a critical extension of its cash runway to develop its air taxi, with a $50 million infusion from company founder and CEO Stephen Fitzpatrick.
The news of the additional capital is an important development for Vertical, which recently suffered some significant setbacks in ushering its VX4 air taxi toward certification. Topping that list woe was an accident last August during a test flight of the eVTOL, when it unexpectedly dropped from about 20 feet in the air onto the tarmac.
After adopting a rather counter-productive minimalist communications policy in response to the crash, the company later announced the problem had been due to a defective anchoring design of a rotor that had since been repaired.
In addition to the resulting unwelcome publicity for a company developing passenger transporting air taxis, the news of Vertical’s eVTOL plunge caused its share price on Wall Street to do something similar.
Questions about the startup’s ability to fulfill plans to obtain certification and launch services in 2026 – if at all – have continued troubling investor minds since.
Indeed, Vertical is among some of the publicly traded advanced air mobility and drone services companies that risk being delisted by stock market regulators for failing to maintain share prices above the dollar threshold.
The new cash infusion is designed to alleviate underlying investor doubts and put an end the recent negative headlines.
It will involve a first infusion of $25 million at $10 per share, with the stock price of the second $25 million to be established later. Vertical says those funds will extend its cash runway to develop the eVTOL into the second quarter of next year, by which time a second generation prototype of the air taxi is expected to be tested and demonstrated.
The latter include planned flights at the Farnborough International Airshow later this year, as well as simulated air taxi operations from Heathrow Airport. Fitzpatrick says his renewed investment in Vertical should provide the last lift it needs to get it eVTOL closer to completion.
“Since founding Vertical in 2016 I have continued to believe in the enormous potential the company has to pioneer zero carbon aviation,” he said. “The company has achieved significant technical progress both in its prototype program and its certification plans in 2023, that I believe is not reflected in our share price. Given the success I have seen in the past 12 months, I am more confident than ever in our world-class team, and I am delighted to further support the company with additional funding.”
Vertical says it has received over 1,400 pre-orders for its VX4 air taxi, valued at more than $5 billion. Clients include American Airlines, Virgin Atlantic, Avolon, Bristow, Marubeni, Japan Airlines, Gol, Air Greenland, and others.
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