Lilium debuted the Pioneer Edition mockup of its Lilium Jet at EBACE.
Lilium has signed a pair of firm agreements for its Pioneer Edition Lilium Jet with two European operators, part of its plan to generate pre-deposit payments (PDP) from charter and private sales before its commercial revenues kick in after type certification.
The first agreement, announced May 22 at the European Business Aviation Conference & Exhibition (EBACE) in Geneva, will see Swiss private jet and helicopter operator Air-Dynamic SA take delivery of five of Lilium’s four-seat premium Pioneer Edition Lilium Jets, which it plans to operate and manage on behalf of customers in Switzerland and Italy.
The second agreement, announced a day later at EBACE, firmed up an existing memorandum of understanding (MOU) with Benelux-based business jet operator ASL Group for delivery of six Pioneer Edition jets. The company says it intends to operate the aircraft as part of a “sustainable, high-speed network connecting major hubs across Belgium, Netherlands, Luxembourg and Western Germany.”
The pair of agreements are significant because Lilium is depending on sales of its limited-edition Pioneer Edition aircraft–of which the company plans to manufacture a total of 50–to generate revenue in the form of PDPs, which can be used to help finance development and type certification by 2025. Including the latest sales, the German OEM has now booked 21 firm orders and 10 options of its 50 Pioneer Edition aircraft, each of which comes at a list price of €10 million ($10.8 million).
In a shareholder letter issued along with its results for the 2023 first quarter (Q1), Lilium said that its commercial strategy will initially focus on Pioneer Edition sales to charter, business and private customers to kick-start revenues in the initial phase of introduction into service, “before transport hubs have been sufficiently established to support higher-volume commercial shuttles in multiple markets.”
The early revenues from Pioneer Edition sales hold extra significance because of Lilium’s limited cash runway, which stood at €143 million at the end of March. This was prior to the announcement of a $250 million fresh equity raise on May 2, $100 million of which was prefunded by existing shareholder Tencent of China. As part of that transaction, Lilium will have to raise a further $75 million to tap a matching $75 million tranche from Tencent.
Lilium said it is in active talks with existing and potential investors to raise the additional $75 million, adding that further funding could be obtained through investors, strategic partners or government agencies in the form of equity, debt or grants. Assuming it is eventually able to obtain the full $250 million outlined in early May, the company has said it would have nearly enough funding to get to first manned flight of its conforming full-scale prototype–expected in the second half of 2024–after which point it would be permitted to tap into PDPs for additional funding.
In terms of certification progress, Lilium said it has now agreed with the European Union Aviation Safety Agency (EASA) on 78% of its Means of Compliance (MOC), up from 72% in the last quarterly update, driven by recent progress on MOCs related to its electrical and propulsion systems. The company estimated that EASA will approve the remainder of its MOCs, along with all of its certification plans, in the second half of 2023.
Another critical milestone, receipt of Design Organization Approval (DOA) status from EASA–which would allow Lilium to perform some critical certification functions on behalf of the regulator–is expected during the second half of this year, the company said.
Lilium in May began testing a powered, 40%-subscale model of its Lilium Jet at the German-Dutch Wind Tunnels (DNW) facility in Marknesse, Netherlands, the largest wind tunnel in Europe. Flight data from the wind tunnel tests will feed into assembly of the company’s first type-conforming prototype, expected later this year.
Lilium’s adjusted cash spend during Q1 was €62 million, in line with its budget plan of €125 million cash spend for the first half of 2023.
