Jens Flottau German startup and Brazilian airline plan to establish a regional high-speed network starting in Sao Paulo.
Jens Flottau
Lilium and Azul plan to create a regional high-speed transportation network using seven-seat eVTOL air taxis (right). Credit: Lilium
German regional air mobility startup Lilium is moving into Brazil, signing a memorandum of understanding with Azul for the acquisition of 220 Lilium Jets valued at $1 billion. Sao Paulo-based Azul is the first airline to opt for the seven-seat electric vertical-takeoff-and-landing (eVTOL) aircraft.
Lilium and Azul also have agreed conditionally to form a strategic partnership to develop a regional high-speed transportation system in Brazil, with operations expected to begin in 2025. The deal is subject to final contractual confirmation, and the memorandum of understanding (MOU) is expected to be turned into a firm order by the end of 2021, says Lilium Chief Strategy Officer Alexander Asseily.
Lilium already plans to launch its own regional air mobility networks in Germany and Florida in 2025. European networks are to be operated by Luxembourg-based business aircraft operator Luxaviation Group, while Lilium will work with a U.S. air operator’s certificate holder to set up the Florida network.
Announcement of the Azul deal coincided with Lilium’s Aug. 2 Capital Markets Day, when the company also revealed it has begun flight tests of its fifth-generation demonstrator. The unmanned five-seater has a redesigned energy system developed after the previous demonstrator was destroyed in a battery fire that occurred during ground maintenance in 2020.
Azul’s preliminary order follows a similar conditional commitment by United Airlines for 200 Archer eVTOLs, announced in February. In June, American Airlines, Virgin Atlantic and lessor Avolon signed preorders and options for a total of up to 1,000 VA-X4 eVTOLs from UK-based Vertical Aerospace. Embraer’s Eve Urban Air Mobility Solutions has received conditional orders for 250 air taxis from helicopter operators Halo Aviation in the UK and U.S. and Helisul Aviation in Brazil.
Lilium plans to introduce the Lilium Jet into revenue service by the end of 2024, initially in Germany and Florida. The company revealed the larger seven-seat aircraft in March when it announced plans to go public through a merger with blank-check company Qell Acquisition. That deal, now expected to close in September, will raise up to $830 million in gross proceeds. The seven-seater is planned to be capable of ranges up to 155 mi. at a speed of 175 mph and altitude of 10,000 ft.
As part of the agreement, Azul plans to operate and maintain the Lilium Jet fleet. In addition to delivering the aircraft, Lilium will provide a platform for technical monitoring of the aircraft, batteries, spares and materials. Azul has also agreed to support Lilium with the necessary regulatory approval and certification in Brazil.
The Azul deal is “another flavor of business model, a slightly more traditional approach where we are selling fleets of aircraft to customers—be it airlines and later potentially governments or logistics companies,” Asseily says. “One of the countries for this approach is Brazil. We are at the beginning of this industry. We need to establish routes in [Germany], but we would be hard-pressed to get up to speed in the same kind of quality in Brazil or China.”
Azul was set up by JetBlue Airways founder David Neeleman in 2008 and has grown into a large domestic airline in Brazil that also offers international services. The carrier is based at Campinas Viracopos Airport outside of Sao Paulo. Its second hub is Belo Horizonte Tancredo Neves International Airport. Brazil is one of the largest markets for civil helicopters, popular for inner-city transportation, particularly in Sao Paulo. “We know how to create and grow new markets,” Neeleman says. “Again we see great market potential for bringing the Lilium Jet to Brazil.”
Sao Paulo, one of the world’s mega-cities and one of the biggest helicopter markets, will be the initial focus of the regional high-speed network that Azul and Lilium plan to establish. Part of the network will be connections to Campinas Viracopos Airport and Sao Paulo’s Guarulhos International Airport.
But the two companies also plan to target the Sao Paulo-Rio de Janeiro market, Brazil’s busiest air route that is currently only served by large aircraft on the “Ponte Aerea” (air bridge). “We won’t make it to Rio until 2-3 years after the initial start of operations,” Asseily says. “Soon after 2026, we expect to get to a range of 300 km. That would be sufficient to link the two cities.”
Separately, Lilium announced that Gabrielle Toledano, chief operating officer at Keystone Strategy, and Henri Courpron, founder and chairman of Plane View Partners, will join its board of directors upon completion of the Qell merger. Toledano was previously at Tesla, Electronic Arts and Siebel Systems. Courpron was CEO of Airbus North America and lessor ILFC, now part of Avolon, and is a close advisor to Neeleman. Former Airbus CEO Tom Enders is chairman of the Lilium board.
