Archer Aviation has secured almost $400m in further funding from automobile manufacturing company Stellantis to fund the labour costs expected as it ramps up its electric vertical takeoff and landing (eVTOL) aircraft manufacturing programme.
The electric air taxi company said the investment from Stellantis, its largest shareholder, would support its ambitions to produce 650 aircraft annually as it nears the launch of its factory in Covington, Georgia and certification for its Midnight eVTOL.
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Announced during the publication of its Q2 2024 results, the news came as Archer revealed its plans for an eVTOL network in Southern California, US which it expects to launch as early as 2026, making it one of the early uses for the Midnight.
CEO Adam Goldstein said the recent news, alongside partnerships with airlines such as United and Southwest, showed the company was “working tirelessly” to launch commercial operations for its aircraft “all over the world”.
He said: “Our indicative order book now sits at nearly $6bn. With the additional funding and planned LA network… Archer is well positioned to meet our goal of commercialization as early as next year.”
In addition to covering the $370m in direct labour costs, Stellantis revealed it would also be contributing to the initial incremental capital expenditures expected by Archer as it ramped up the production, estimated to be around $20m.
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By GlobalDataAs a result of Stellantis’ additional investments, the company will receive Archer shares on a rolling quarterly basis based on the total labour costs incurred during that period and Archer’s current future stock price.
Archer said it also intended to issue $30m to Stellantis in performance warrants that will vest based on the manufacturer’s achievement of performance milestones laid out in the investment contract.
The agreement highlights Archer’s increasing confidence in the approaching launch of its commercial aircraft operations, with the company’s Chief Growth and Infrastructure Officer Bryan Bernhard recently telling Airport Technology that the manufacturing plans showed how Archer was “leading the charge”.
He said: “When we talk about scaling up to 1000 vehicles, having a facility of 350,000 square feet to be able to do that showcases our ability to scale up.
“We have made that investment now to unlock our ability to scale up and to continue manufacturing there [in Covington].”
