Stellantis to Produce Air Taxi with Archer

Car maker Stellantis (STLA.MI) is set to help Archer Aviation (ACHR.N) build its electric plane and increase its stake in the US company. Industrial firms and startups are flocking to invest in air taxis that can take off and land vertically to transport passengers to airports or short trips between cities, allowing them to beat traffic.

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Production will start in 2024

The 100-mile (161 km) range, four-passenger, one-pilot, vertical takeoff and landing (eVTOL) Midnight aircraft will be manufactured in Covington, Georgia, with a production target of 2,300 aircraft by 2024, Archer and Stellantis announced in a joint statement.

It's designed for back-to-back short-haul trips of about 20 miles, with only about 10 minutes of charging time in between. "The goal of Stellantis is to mass produce Archer's eVTOL aircraft as a contract manufacturer." the companies said. Created from the merger of Fiat, Chrysler and France's Peugeot, Stellantis will provide up to $150 million in equity capital, subject to Archer's discretion and the achievement of certain business milestones in 2023 and 2024.

Stellantis will also increase its existing stake in Archer by buying stock on the open market, but its CEO Carlos Tavares said he wants to retain a minority stake. "We are not here to control, we are here to support." he said at a press conference at Archer's headquarters in San Francisco. Stellantis aims to be a long-term, cornerstone investor in Archer, the companies said. Tavares was quoted as saying why the car company turned to aircraft manufacturing:

Other eVTOL initiatives involving the auto industry include a collaboration between Hyundai Motor Group's air taxi unit and aerospace supplier Honeywell International to develop avionics systems. The auto industry is far ahead in battery design, but the weight of the current generation of batteries is seen as a limiting factor for the range and payload capacity of new vehicles. In November, European aircraft manufacturer Airbus (AIR.PA) formed a partnership with French carmaker Renault (RENA.PA) to develop the next generation of electric batteries and hybrid technology for cars and airplanes.