Vertical Aerospace has announced deals worth $4bn with American Airlines, Virgin Atlantic, and leasing group Avolon for up to 1,000 of its VA-X4 eVTOL aircraft.
The VA-X4 eVTOL aircraft can carry four passengers up to 120 miles. The deals represent the largest sales agreements placed so far in the emerging advanced air mobility sector. The Bristol-based manufacturer has announced plans for an initial public offering on the New York Stock Exchange through a merger with special purpose acquisition company Broadstone Acquisition Corp.
Vertical Aerospace completed the design of the VA-1X last year and has begun building the prototype. The vehicle has since been renamed VA-X4 to reflect its four-passenger capacity. Flight tests are planned for this summer. Rolls-Royce will develop the VA-X4’s electric propulsion system with avionics and control systems provided by Honeywell. Solvay will manufacture composite aerostructures for the aircraft.
American Airlines and Avolon, along with Honeywell and Rolls-Royce, are also PIPE investors. They will join existing strategic backers in Vertical, including Microsoft’s M12 investment arm, 40 North, and Rocket Internet SE. American is set to invest $25 million with the other new backers not disclosed their capital contributions. Honeywell and Rolls-Royce are supporting Vertical to complete EASA type certification of the four-passenger, all-electric VA-X4 aircraft in 2024.
American Airlines to develop passenger operations in US market
American has provisionally agreed to take 250 aircraft, with options for 100 more. Avolon has committed to 310 aircraft with options for a further 190. American also intends to work with Vertical on developing passenger operations and infrastructure in the US market.
Virgin Atlantic has indicated its intention to launch a network of short-haul scheduled services in the UK operating on routes around the aircraft’s range of 120 miles. The carrier is to buy between 50 and 150 aircraft and it set to operate its flights from hubs at London’s Heathrow and Gatwick airports and Manchester.
American Airlines CFO Derek Kerr said: “Emerging technologies are critical in the race to reduce carbon emissions and we are excited to partner with Vertical to develop the next generation of electric aircraft. For years, American has led the industry in investing in newer, more fuel-efficient aircraft. Today’s partnership is another example of that commitment and an investment in the future of air mobility.”
Vertical was founded in 2016 by Stephen Fitzpatrick, founder of energy retailer Ovo. He remains the majority shareholder following the merger with Broadstone, which was founded by UK entrepreneurs Hugh Osmond, Marc Jonas, and Edward Hawkes. Fitzpatrick said: “This is the most exciting time in aviation for almost a century. Electrification will transform flying in the 21st century in the same way the jet engine did 70 years ago.”
The company expects to achieve profitability and cash flow breakeven on annual sales of less than 100 aircraft by 2024.