Reports are in, the German flying taxi unicorn Lilium is going through a serious financial crisis. Its main subsidiaries in Germany are preparing to file for bankruptcy. This news follows when the German government denied its application for a €50 million loan guarantee, which was crucial for the company’s financial strategy. This denial meant that Lilium could not access a matching €50 million commitment from the State of Bavaria, which had been contingent on federal support.
As a result, Lilium’s shares plunged, signalling significant challenges for its ambitious vision in the electric vertical takeoff and landing (eVTOL) sector.
Last year, the company raised $250 million in capital, with $100 million already secured at the close of the deal.
What’s next for Lilium?
As per reports, the parent company Lilium NV could lose control over the subsidiaries – Lilium GmbH and Lilium eAircraft GmbH. The management of the German units would continue to be under the supervision of a custodian and two lawyers, who would act as bankruptcy administrators. The aim is to sell the assets or the entire business to maximise returns to creditors.
At this point in time, only new sources of financing can help the company retain its business. If insolvency occurs, its shares, traded on the Nasdaq stock exchange, may be delisted. As a result, current investors may lose the value of their investments.
To date, the company has spent €1.5 billion developing the Lilium Jet, its electric vertical take-off and landing aircraft. The first flight of this prototype was expected for early 2025. Despite being an ambitious project, it lacked certainty.
That said, here are some key facts about Lilium and its journey so far.
New mode of urban air mobility
Lilium was established in 2015 by Daniel Wiegand, Sebastian Born, Matthias Meiner and Patrick Nathen. In 2019, the company revealed the prototype of its five-seater electric air taxi — Lilium Jet. The company focuses on developing eVTOL aircraft, aiming to create a new mode of urban air mobility.
Flagship product – Lilium Jet
Lilium’s flagship aircraft, the Lilium Jet combines the convenience of vertical take-off capability with the speed of a jet on intercity regional missions. It features 30 battery-electric motors within the main wings and canards’ flaps, the only moving exterior parts. It features 6 passenger seats, a unique design with 36 electric jet engines, a projected range of about 300 kilometres and top speed of around 190 km/h.
Raised over $1B in funding
Lilium has attracted significant investment over the years, raising a total of $426 million today (as per Dealroom) to support its development. The company went public via a SPAC merger in 2021, valuing it at $3.3 billion at that time.
Regulatory progress
The company has been working closely with aviation authorities to meet regulatory standards for airworthiness. In 2023, Lilium achieved a significant milestone when it received a development permit from the European Union Aviation Safety Agency (EASA) for the Lilium Jet.
Global partnerships
Lilium has established strategic partnerships with major airlines and investors to support its development and commercialisation efforts. These partnerships include agreements with companies like Saudia Group for aircraft orders — the national airline of Saudi Arabia, to supply 100 of its eVTOL jets, which Saudia aims to deploy as part of its private aviation services. These jets will primarily support luxury and business travel, potentially transporting passengers between major hubs like Riyadh and Jeddah and even facilitating pilgrimages to Mecca for Hajj and Umrah, potentially easing the transportation challenges during peak seasons.
The eVTOL market is expected to grow from $1.2 billion in 2023 to $23.4 billion by 2030, with an anticipated CAGR of 52%, driven largely by Germany’s leadership in Europe. Among key players in this field is also Germany-based Volocopter is working on eVTOL multi-copter aircraft to support efficient urban travel with plans for accessible air taxi services worldwide.
Despite industry enthusiasm, the eVTOL market still faces high production costs. Volocopter, like Lilium, also encountered these financial challenges but recently secured more funding aimed at achieving certification for its VoloCity air taxi model. In mid-2024, Volocopter confirmed it has sufficient financial support, including investment from Saudi Arabia’s NEOM project, to advance its urban air mobility solutions and help realize air taxi services in future-oriented cities like NEOM.
On a global scale, major tech companies are also preparing to enter the eVTOL market. Uber is collaborating with Aurora Flight Sciences, a Boeing subsidiary, to develop its flying taxi service. Meanwhile, EHang from China is partnering with aviation supplier FACC for its air mobility solutions and Airbus, the European aircraft manufacturer, is actively working on its own flying taxi initiatives.
Looking for a job? here are 5 jobs to apply, only on TFN!
DevOps Engineer, Barclays Bank PLC, KnutsfordData Scientist, NatWest, EdinburghSenior JAVA Developer, Virgin Money, Northern IrelandEngineering Manager – Software, BAE Systems, Rochester, Senior Software Engineer, BP Energy, Milton Keynes
Seeking a new challenge? Check out the Tech Funding News Job Board to find your next opportunity
The post Lilium on the brink of bankruptcy: 5 things to know about German flying taxi startup appeared first on Tech Funding News.