22-02-2025
German air taxi developer Lilium files for insolvency again after funding options fail
German air taxi developer Lilium Aerospace has filed for insolvency for a second time, saying that it has failed to secure funding and casting doubt on its ability to fulfil orders. The company, which had initially entered administration in October, said in a brief statement that 'funding options to secure Lilium's future have not materialised in time', forcing it to file for insolvency. 'While talks about alternative solutions are still ongoing, the chance [of] restructuring right now is highly unlikely and therefore operations will be stopped,' the statement said. '[Given] the situation, this is deeply regretful for all employees and Lilium Aerospace thanks them for their resilience and dedication.' Lilium, based in Bavaria, has been developing electric vertical take-off and landing (eVTOL) jets, a new class of EV designed to take off, hover and land vertically, much like a helicopter. They are powered by electric propulsion systems, making them eco-friendly and quieter than helicopters. The company completed test flights of the world's first electric flying taxi jet in 2017. The eVTOL market was hyped for its capabilities and support for achieving sustainability goals, but some makers have hit turbulence. In December, air taxi maker Volocopter filed for bankruptcy, citing financial difficulties. The company, also based in Germany, plans to develop and enact a 'restructuring concept' by the end of February, it added. UK-based Vertical Aerospace sought emergency funding last year, shortly before Lilium's first insolvency. In November, Rolls-Royce pulled out of the electric flying taxi sector after chief executive Tufan Erginbilgic signalled the British engineering firm would focus on profitable contracts. It is unclear what Lilium's next steps are, or what the insolvency means for signed agreements to supply jets. In July last year, aviation conglomerate Saudia Group signed a binding agreement with Lilium to buy 50 eVTOLs. The agreement included an option to buy another 50 jets, and Saudia expected to receive the first jets in 2026. The jets would have had cabin capacity for up to six passengers, plus luggage room. That followed Saudia's initial agreement with Lilium, in October 2022, to buy 100 Lilium aircraft for its domestic network. Lilium had touted the 'tremendous opportunities' in the Middle East, particularly the GCC, where the development of megacities calls for ways to minimise traffic and slash carbon emissions. The company had made waves, earning backing from Saudi Arabia's Future Investment Initiative Institute. In 2021 the institute invested in Lilium as part of a $3.3 billion transaction that helped the company list on the Nasdaq Composite in New York. Former Airbus chief executive Tom Enders joined Lilium's board in the same year.
