Saudi Arabia's eVTOL future

Saudi commits to an eVTOL future via Lilium and Volocopter deals

The two biggest all-electric aircraft news announcements of the past month have both been about deals with Saudi Arabia - and both concerning German electric vertical take-off and landing eVTOL aircraft companies. The two deals have the potential to transform the domestic air services market in the Kingdom, whilst contributing to the Saudi Green Initiative, which aims to acheive net-zero carbon emissions for the country by 2060. However, as with many new proposed urban mobility systems, the big announcement that will now be most anticipated is how the government plans to regulate this new sector.

Announced during the Future Investment Initiative last week, German aircraft manufacturer Lilium, developer of the first eVTOL passenger jet and the Kingdom's national carrier SAUDIA announced the signing of a memorandum of understanding (MoU). The national airline agreed to purchase 100 Lilium Jets, together with annual support service contracts. It's a significant deal for both parties. Lilium has a relative few big pre-orders from aviation companies such as Brazilian airline Azul and U.S. private business jet operator NetJets, so the SAUDIA order would help further justify production plans. On the other hand, via this deal, SAUDIA joins a select club of airlines that have commited to eVTOL services.

In an announcement made this week, mega-congnitive city developer NEOM further cemented its commitment to urban air mobility (UAM) pioneer Volocopter, by investing $175 million in the second signing of the startup's Series E funding round. The investment follows the formation of a NEOM-Volocopter joint-venture company in 2021 to develop a vertical mobility system for the futuristic city, to include services for public transport, logistics, emergency response and tourism. NEOM committed to purchasing 15 Volocopter eVTOLs as part of the plan.

Although they compete in different spaces, Lilium and Volocopter aircraft are both designed to have zero carbon emissions and reduce noise pollution. However, it would be a mistake to assume that these are the only two net-zero emissions air mobility players that we're likely to see take-off in Saudi Arabia. Neither of these companies yet have any aircraft in commercial service and other firms are likely to step up sooner or later. 

For example, Airbus signed a deal with Saudi government-owned The Helicopter Company (THC) during the World Defense Show in Riyadh earlier this year, which included helping THC plan for future UAM craft and services. Meanwhile, JIMCO (Jameel Investment Management Company) is a backer of California-based eVTOL developer Joby Aviation, which is developing a single-pilot air taxi capable of carrying four passengers on flights up to 241 kilometres.

Nevertheless, Lilium and Volocopter may find themselves with a first-mover advantage in Saudi Arabia, able to both help plan air mobility systems with government backing and perhaps to open a dialogue with authorities on defining new aviation policy. In fact, such a policy discussion could prove pivotal to the whole sector.

Aviation regulators globally are ill-prepared for the arrival of all-electric urban air mobility services. Whilst some aviation processes can be applied equally to eVTOLs, new operational models, frameworks and processes are also required to assess eVTOL airworthiness, air traffic safety and end-to-end passenger safety for these new categories of aircraft. And if global civil aviation regulators are waiting for the U.S. Federal Aviation Administration (FAA) to solve the regulatory issues, then the could be in for a long wait.

In Singapore, a market that Volocopter plans to launch air taxi services in by 2024 (originally 2022), regulations still seem to be in the early stages of development. The Civil Aviation Authority of Singapore (CAAS) signed an MoU with the European Union Aviation Safety Agency (EASA) last month to collaborate on urban air mobility regulation. Public safety and the need to safeguard existing commercial aviation are obviously top priorities for any government regulator considering adding eVTOLs into its airspace.

Saudi Arabia has a growing reputation for investing in new, cutting-edge technology and has proved that money is no object when technology investments are considered strategic by the government. The government-sponsored $3.4 billion investment and finance package paving the way for electric luxury sedan manufacturer Lucid Motors to build a Saudi production plant with an annual capacity of 155,000 units, proves this trend beyond doubt. Beyond Lucid, the country's Minister of Investment has already indicated that talks with 2-3 other electric vehicle manufacturers are already ongoing with a view to opening several production plants.

So, it would come as no surprise to hear of Saudi production plans for Lilium or Volocopter further down the road, should market demand justify it. Lilium is currently searching for funds to build a production plant in Germany with a capacity of 400 aircraft per year, but is already mulling the possibility of locating a second plant somewhere else, globally. The Kingdom would be an obvious potential suitor. Likewise, there's much scope for the NEOM-Velocopter joint-venture to develop beyond its current mandate.

In the meantime, to make the country's eVTOL future become reality, new civil aviation regulations and approvals must be high on the pre-flight checklist.

• Read the NEOM-Volocopter press release.

• Read the Lilium-SAUDIA press release.

• Read more about the Neom-Volocopter joint venture in Middle East AI News 02-Dec-21 (Linkedin version)

This article first appeared on Linkedin.