Stellantis to Increase Stake in U.S. Air Taxi Firm Archer, Reports Reuters

By Gilles Guillaume

PARIS – Carmaker Stellantis has announced its collaboration with Archer Aviation to build electric aircraft and increase its investment in the U.S. company. This news led to a nearly 17% surge in Archer’s stock prices.

As the air taxi market gains momentum, various industrial firms and startups are eager to make investments. Air taxis, capable of vertical take-off and landing, offer travelers a solution to escape traffic, providing quicker access to airports or short trips between cities.

The eVTOL Midnight aircraft, which seats four passengers and a pilot, boasts a range of 100 miles (161 km) and will be produced in Covington, Georgia, starting in 2024. The joint statement from Archer and Stellantis indicates a production goal of 2,300 aircraft annually. Designed for short trips of around 20 miles, the Midnight has a charging time of about 10 minutes between flights.

According to the companies, Stellantis aims to serve as the exclusive contract manufacturer for mass production of Archer’s eVTOL aircraft. Stellantis, formed from the merger of Fiat Chrysler and Peugeot, plans to provide up to $150 million in equity capital for Archer throughout 2023 and 2024, contingent on meeting specific business milestones.

Additionally, Stellantis will expand its stake in Archer through stock purchases on the open market, although CEO Carlos Tavares stated that the intent is to maintain a minority interest. "We are here to support, not to control," he emphasized during a conference at Archer’s San Francisco headquarters. Stellantis seeks to be a long-term cornerstone investor in the startup.

Tavares also explained the rationale behind entering the aircraft manufacturing space: "You can enjoy freedom of mobility with any kind of mobility tool. It can be a bicycle, a car, an aircraft, or anything else. Our commitment lies in delivering safe, clean, and affordable freedom of mobility through high technology."

In addition to Stellantis and Archer, other automotive partnerships are emerging in the eVTOL sector, such as the collaboration between Hyundai Motor Group’s air taxi division and aerospace supplier Honeywell International for the development of advanced avionics systems.

The automotive industry currently leads in battery design; however, the weight of modern batteries poses challenges for the range and payload of new vehicles. In a related move, European planemaker Airbus recently announced a partnership with French manufacturer Renault to develop future generations of electric batteries and hybrid technology applicable to both cars and aircraft.