Electric passenger aircraft developer Joby Aviation has bought Uber Elevate, the flying taxi unit of Uber Technologies Inc.
Uber Elevate is the second business to be sold off by the ride-hailing company this week as it announced the sale of its self-driving unit to autonomous vehicle startup Aurora on Monday. The company discussed the impact of COVID-19 on the UAM sector during FIA Connect in July 2020.
Financial terms of the acquisition have not been disclosed but Uber has agreed to invest a further $75 million California-based company Santa Cruz as part of the transaction, bringing its total investment to $125 million. The deal is expected to be finalised in early Q1 2021, subject to regulatory review and customary closing conditions.
Joby promises launch of flying taxi service in 2023
Joby has raised $820 million in funding since it was founded in 2009. The company is developing an all-electric, vertical take-off and landing passenger aircraft with the promise of the launch of flying taxi services in Los Angeles, Dallas and Melbourne in 2023.
Uber and Joby said they would each integrate the other company’s services into their own app to allow customers to book seamless ground and air transportation in the future. Uber will now focus on its core markets of ride-hailing and food delivery platforms to achieve profitability. The company has promised investors to achieve profitability on a basis of adjusted earnings before interest, taxes, depreciation and amortization by the end of 2021. Cost cutting measures, including large rounds of redundancies have already been implemented.
Company has laid “groundwork” for aerial ridesharing market
Uber Elevate has played a role in laying the groundwork for the aerial ridesharing market by bringing together regulators, civic leaders, real estate developers and technology companies around a shared vision for the future of air travel. The company was established in 2016 and has software tools enabling market selection, demand simulation and multi-modal operations.
JoeBen Bevirt, founder and CEO, Joby Aviation said: “We were proud to partner with Uber Elevate last year and we’re even prouder to be welcoming them into the Joby team today, while deepening our cooperation with Uber.”
“The team at Uber Elevate has not only played an important role in our industry, they have also developed a remarkable set of software tools that build on more than a decade of experience enabling on-demand mobility. These tools and new team members will be invaluable to us as we accelerate our plans for commercial launch.”
eVTOL has range of 150 miles, top speed of 200mph
Joby will operate an affordable, quiet and clean transportation service, using its all-electric, vertical take-off and landing aircraft which has a range of up to 150 miles and a top speed of 200 mph.
Dara Khosrowshahi, CEO, Uber added: “Advanced air mobility has the potential to be exponentially positive for the environment and future generations. This deal allows us to deepen our partnership with Joby, the clear leader in this field, to accelerate the path to market for these technologies. We’re excited for their transformational mobility solution to become available to the millions of customers who rely on our platform.”
While losses at Uber’s self-driving, Elevate and other technology programs had slightly narrowed this year, the company still reported a third quarter $104 million adjusted EBITDA loss for the segment.
Uber in January announced it had partnered with South Korean automaker Hyundai Motor Co to develop electric air taxis as part of its Elevate programme.