The world has dreamed of
the day flying cars will become a part of daily
life. And despite many attempts, that day hasn't
come. But we might not have to
wait much longer. Advances in battery and
electric propulsion tech have enabled entirely new
types of aircraft to take to the skies. Things we once only saw in
cartoons, thought of as science fiction, are
actually coming to life right before our eyes. Electric propulsion has
enabled us to think differently about
aircraft design and to develop a new class of
aircraft. Startups Joby, Archer,
Vertical, Lilium and more are developing eVTOLs,
electric vertical takeoff and landing aircraft,
with the vision of making air taxis a reality. This new mode of
transportation allows us to move into the third
dimension and rethink the way our cities operate. The vehicle of the future. The Tesla meets Uber of
the air, where we can redefine human mobility. Major airlines have been
securing deals and preorders in the hopes
that these take off. The eVTOL space is going
to fundamentally change how people get to an
airport. CNBC got an inside look at
Joby Aviation, one of the eVTOL players that has
grand ambitions of not only building the
aircraft but operating an uber-like air taxi
business. The problem in cities is
often overcrowded or bottleneck
infrastructure. We have an opportunity to help solve
that problem by getting people over and above
traffic to where they want to go as much as 5 to 10
times faster than driving on the ground. Investment in eVTOL
startups has taken off. Last year, $5.8 billion
was invested and it is estimated the U.S. Passenger eVTOL market
could reach $17.7 billion by 2040. But enormous
challenges lie ahead. The future of urban air
mobility is still being mapped out by regulators,
and Joby must prove its aircraft will be safe for
commercial transit. That is one of the biggest
hurdles for the eVTOL industry, particularly as
it gets into the development and entry
into service spaces. The FAA will want to make
sure there's a great safety record behind
these. We are working with the
same level of energy as the industry itself. Innovation can never come
at the expense of safety. It has to work hand in
hand. Our designs are locked in
and we're now in the stages of going through
the testing analysis and then moving into the
certification. We are very close to making this
reality. When I was a child, I
dreamt about building an airplane that could take
off and land vertically. That was quiet and that
was sustainable. The solution to that, in
my mind, was electric propulsion. When I was in
college in 1993, I worked on it. The challenge was
that batteries weren't ready. JoeBen Bevirt went off to
study robotics at Stanford. He later
founded a robotics company and after that, invented
a popular flexible camera tripod called the
GorillaPod. Those two successes gave
me both the confidence and the financial resources
to go back to my childhood dream. In 2009, he founded Joby
Aviation in Santa Cruz, California. We started the company in
this redwood barn, and it was a really tight-knit
group of engineers dedicated to building a
new class of aviation company with vertical
integration in its DNA. Early on, the focus was on
the proof of concept. That went on for the
first few years, leading to 2017 when we started
flying effectively the aircraft that resembles
what we have today. The aircraft you're seeing
today began flying in 2019. Our first
production intent aircraft will be rolling off our
pilot manufacturing line shortly. The company has secured
sizable investments from some big names. In 2020, Toyota invested
nearly $400 million and is helping the company with
manufacturing. They've been able to give
us a lot of assistance, even in this stage, in
terms of how do we design the right manufacturing
facility. It also received a
Department of Defense contract for more than
$75 million. Since 2016, they provided
us access to flight test facilities, restricted
airspace, that has significantly accelerated
the development of this really exciting new
technology. In 2021, the company went
public via a SPAC with Reinvent Technology
Partners, which is run by LinkedIn co-founder Reid
Hoffman and Zynga founder Mark Pincus. Bringing
Joby $1.6 billion. The company manufactures
and performs flight tests at a pilot production
facility just outside Monterey, in Marina,
California. Our pilot manufacturing
facility is where we are going to optimize our
build rate. And we're also going to
build tens of airplanes per year. Unlike an electric car,
weight considerations are far more important in an
aircraft to maximize range. As a result, the
entire airframe is made of composites. Composites are really a
combination of composite material and honeycomb
pieces. You'll also see at a
smaller scale use of metallics, such as 3D
printed titanium, as well as some other materials,
such as aluminum. Some of the material
we're using here and the way we process it, cut it
and cure it is really state of the art of what
you would see in aviation. Once the parts are
manufactured, they go through rigorous
inspections. This is one of those
inspections that we call nondestructive
inspections. And the idea is to leverage this UT
robot to actually see through the material and
identify any defects. Once we've done with
that, if we have a clean check, then we can
proceed into the assembly part of the manufacturing
process. We have the Toyota team
here working with us on a daily basis, helping us
with their automotive expertise so that we can
really design the right footprint, use the right
equipment and right processes that really
allow us to scale from this facility to the much
larger one. This aircraft is one of
our prototype airplanes that we are using
throughout the development process. All electric
aircraft designed from the get go. Intended for five
occupants, one being the pilot, and then for
passengers with plenty of luggage space. Each of
these propulsion units is articulated to allow us
to take off vertically like a helicopter, then
go through a transition phase and then go wing
born and fly like an airplane. We've
demonstrated in the past that we were able to
exceed 200 miles per hour, 150 miles on the range. But in typical use,
you'll see it used more for flights within 50
miles or less. Each of our six propulsors
is powered by two separate motors with separate
inverters powering each motor and separate
battery packs powering each inverter. Since the aircraft will be
operating in urban environments, noise was a
key concern the team designed for. The acoustic signature is
core to being able to land where our customers want
to go. And it's not just the
level of the noise, it's also the quality of the
noise, a noise that blends into the background. The company said a
majority of the aircraft and its components were
developed in-house. The batteries were also
developed by Joby, with a team of ex-Tesla
engineers. Our battery team, they
were responsible for developing the battery
packs for the Tesla Model S, the Tesla model 3 and
the Tesla Model X. Joby uses a simulator to
develop and test the software that powers the
aircraft. We check that the software
actually is doing what it's supposed to do. So
we check that the avionics do things that they're
supposed to do. We check that the control
laws or the way the airplane flies and
handles and maneuvers does exactly what it's
supposed to do. The simulator is also
crucial for training. So we are going to be
bringing hundreds and thousands of pilots
through this type of simulator in the future. The important aspect is
that the simulator is very close to the real
aircraft and actually flies exactly like the
real aircraft. Here we go, we're on our
way up. I'm actually making no
inputs at all right now. And what you can see is
the aircraft is in a perfectly steady hover. This isn't me. I'm not
doing anything. This is the aircraft. If you sat here in a
helicopter, and I am a helicopter pilot, or a
jump jet like a Harrier, you would be working on
the controls, multiple inputs, like an input
every second, in order to keep it steady and keep
it in this location. But I'm actually doing
nothing. And this is one of the key elements that
makes our aircraft easy to teach. Joby's vision doesn't stop
at just developing the aircraft. It's also the operations,
it's the customer experience, the
vertiports, we're building a whole ecosystem. In 2020, the company
acquired Uber Elevate, Uber's air taxi division,
along with a $75 million investment. That team is providing all
of the technology to deliver on the multimodal
experience, as well as coordinating the pilots,
the maintenance, the customer service staff. Just recently, Joby inked
an exclusive five-year partnership with Delta
Airlines. The carrier is investing $60 million
with plans to use its air taxis to transport
passengers to and from airports. It's been a multi-year
journey and our teams have been talking to different
people in the industry. We are investing $60
Million into Joby. We have the ability to
grow that investment over time. We will have a
board seat. Delta has invested
billions of dollars into airport infrastructure
and we're leveraging that infrastructure and the
relationships that Delta is built to deliver
vertiports at the airport. Delta tends to be one of
the more conservative airlines, and their
investments certainly stood out to me as very
compelling and their sort of support for this eVTOL
industry. And I think the fact that
each airline is individually partnering
with a different OEM tells you that they don't want
to be left out if this does, no pun intended,
take off. Joby envisions the
experience being all-inclusive for every
leg of the trip. It starts with booking a
flight in either Joby's app or one of its
partners, such as Delta or Uber. You can use our app or the
Uber app to book a seamless, multimodal
journey from door to door. Our goal is once a
customer picks their flight, they can then add
on a Joby connection itinerary to that and
have all of that transaction happen on the
same experience on Delta.com or the Fly
Delta app. Joby says the cost of
these trips will be comparable to what one
might pay for a premium Uber. Our goal is to make this
equivalent to ridesharing today, similar cost per
mile for every seat that we're delivering. The cost of the actual
eVTOL, the average selling prices, they're anywhere
from $3 to $5 million depending on the
manufacturer. Whether they'll make money on
that? That's a question that remains to be seen.
So that'll answer how much the consumer has to end
up paying and how much the operator is willing to
subsidize. The company is targeting
late 2024 for its launch, but hasn't revealed where
it plans to offer the service first. We certainly think of this
business as one that's applicable for large,
medium and small sized cities, both here in the
US and abroad. Our approach is going to
be to go deeper into a smaller number of cities
as opposed to going wide. That's the way that we
can show the utility of this service and really
drive down cost on the other side. It's also looking at
eventually servicing rural communities. We've got an opportunity
to get people to where they want to go there by
basically roads in the sky that don't exist on the
ground. But before Joby can begin
ferrying passengers through the skies, it has
some major hurdles to overcome. The aerospace
industry is heavily regulated and the Federal
Aviation Administration has strict standards for
aircraft used in commercial operations. Commercial aerospace,
despite proven aircraft and long certification
processes that range anywhere from 5 to 10
years for each aircraft model, still have major
setbacks. We have to certify the
vehicle or the aircraft itself. Second, we have
to certify the operation. That is, how will the
operators, the pilots, operate for something
that takes off like a helicopter, translate to
forward flight, lands like helicopter. And then
thirdly, how do we ensure that we safely integrate
this new technology into our national airspace
system. We began certification
with the FAA in 2018 in a formal way and received
our Stage 4 G1 issue paper in May of 2020. We
recently announced the completion of our Part
135 Operating Certificate. eVTOLs are especially
tricky since it's the introduction of an
entirely new aircraft. Because you have a novel,
new aircraft that will operate in both modes, we
want to make sure that we get that right from a
pilot's training. And then as we gain more
and more experience and we've gained more time in
this, we can continue to evolve our regulatory
framework there. And the general public
will need convincing that these are safe. We talk
about safety of ten to the minus nine. That's
something happens one in a billion time. This is
what the public has come to expect every time they
get aboard an aircraft. We want them to feel as
safe on an eVTOL as they are on a commercial
airliner. And that's what we are
building toward and that's what the industry must
adhere to. Also critical to its plan
is gaining buy in within the urban environments it
hopes to operate. We're interfacing across
multiple different areas of the FAA, along with
municipal governments, incorporating the
feedback from communities. And that is why we're so
focused on the acoustic signature. We want
communities to want our vertiports. And when it does receive
all the necessary approvals for the
aircraft, it still has the uphill battle of scaling
manufacturing. One report claims Joby
cannot hit its ambitious 2024 target. This facility has the
capacity for tens of aircraft per year. The
next step is to select our site for our phase one
production facility that will allow us to scale to
hundreds of aircraft per year. Joby also has a lot of
competition, with an estimated 200 companies
worldwide developing vertical takeoff and
landing aircraft. Archer Aviation, another
California based startup, is also in the testing
phase. It went public last year
through a SPAC and received funding from
Stellantis and United Airlines. Earlier this
year, it received a $10 million deposit from
United for 100 of its aircraft. American
Airlines has also thrown its hat into the ring,
backing UK based Vertical Aerospace. But given the
difficulty and expense of building a successful
aerospace company, some predict consolidation. I think the share prices
say it all. The share prices have not
been great since launch. So there definitely will
be consolidation as development timelines
could be prolonged and liquidity might be
needed. And once these aircraft
are operating, price will be the determining factor
in whether these ultimately succeed. What really has this
industry take off is getting that price cost
equation lower. I would certainly take a
$100 ride to JFK and save an hour of my time. And of course, higher
adoption, as we've seen with Uber, as we've seen
with companies like Wheels Up, have more demand come
in. I dream of that day where
myself and my kids are going to be getting on a
Joby aircraft from an airport somewhere and
traveling downtown. And we're doing that, not
only with ease, but also by leaving a clean
footprint across the board. I want to be one
of the first passengers out there. We're still in very early
innings when it comes to the long arc of the
business. We need to stay extremely focused every
day and making sure we're putting one foot in front
of the other so that we can get to the next
chapter of the story and the chapter that comes
after that. If there's any skeptics
out there, just watch our execution, watch our
results. We're going to continue to deliver. We are so excited about
what this next stage of aviation is going to
bring.