Lilium has told investors it is sticking to a “disciplined approach” to completing type certification of its four- to six-passenger eVTOL aircraft by the end of 2025. In a letter to shareholders published on Tuesday, the company said it ended the first quarter with €102 million ($109 million) in unaudited liquidity, adding that this war chest has since been boosted by $114 million in fresh funding raised in May.
As it continues to produce the first production-conforming examples of its Lilium Jet at its headquarters near Munich, the company is now projecting cash spending for the first half of 2024 of between €185 million and €195 million. Lilium is aiming to start flight testing as part of the EASA certification process by the end of 2024.
In the next six to eight weeks, Lilium hopes to receive confirmation of a further €100 million in loan guarantees from the German federal government and the state of Bavaria, now being considered as part of a due diligence process. At the same time, the company is in talks with the French government over around €200 million in funding for a planned high-volume manufacturing facility in France.
At last month's EBACE business aviation show in Geneva, Lilium firmed up a sales agreement with private jet operator Volare, which intends to manage Lilium Jets for high-net-worth owners. The company also announced plans to launch eVTOL air taxi services across wealthy communities in France's Côte d'Azur region and confirmed that business aviation services group Luxaviation will support the launch of commercial operations.
Seeking Access to the Chinese Market
On Monday, Lilium reported that it has established “a legal entity” in China to advance a collaboration with the Bao’an district of Shenzhen covered by a memorandum of understanding last year. The company said it is now establishing a regional headquarters in the Bao’an Low Altitude Economy Industry Public Service Center that will be used as a hub for sales, services, and support to customers in China and the Asia-Pacific region.
The company also confirmed that it will seek type certification for the Lilium Jet with the Civil Aviation Administration of China, by applying for its anticipated EASA approval to be validated. It believes China will account for around 25% of the global market for eVTOL aircraft, and that the wider Southeast Asia region also has great potential due to its growing GDP and urban congestion issues.
Lilium has named its new Chinese unit “Powerful Wing” and said it will initially focus on opportunities to develop a market for eVTOL air services in the Guangdong-Hong Kong-Macao Greater Bay Area. The German company said it will start recruiting local staff this year to support developing relationships with local infrastructure partners, customers, and regulatory agencies. In line with its standard business model, Lilium will not operate aircraft itself.
According to Louis Liu, founder and CEO of China-based consultancy DAP Technologies, European eVTOL developers like Lilium and Volocopter are eager to enter the Chinese market, where there is more assertive government support for advanced air mobility and opportunities to secure state subsidies. Citing policies like government agency support for initiatives such as the low-altitude economy under the national strategic direction policy, he told AIN that China offers an alternative to “tough challenges” in the European Union over funding obstacles and lengthy approval processes.
According to DAP, which advises advanced air mobility companies, Lilium may also be drawn to China by the prospect of access to the country’s electric vehicle manufacturing and battery manufacturing capability. Its largest shareholder, Tencent, is based in Shenzhen.
"We do not have plans to manufacture in China at this point in time," a Lilium spokesperson told AIN. "While it is not our initial focus, establishing a manufacturing site in China is possible in the future."