What can we learn from Toyota’s investment in air taxi company Joby Aviation?
Toyota has announced a US$394 million investment in Joby Aviation, until now a relatively secretive California-based air taxi start-up. The move suggests that a commercial market for vertical take-off and landing (VTOL) services is gathering serious momentum, but will the venture be able to overcome the sizeable barriers that stand in its way? We investigate the gamble further.
What is Joby Aviation?
The American start-up is one of several VTOL companies that have been searching for nine-figure investment to scale their business and make the dream of VTOL flying cars a reality. Their hope is that the $590 million raised in the last round of funding will help them a long way towards finding a commercial solution.
Up to this point, the start-up has been strikingly secretive. Of course, we have always known that its main feature was electric motor power rather than combustion engines, but apart from that, there has been relatively little noise in the media about the company.
Following the latest round of funding, more information has begun to surface. With six rotors in place, the aircraft is designed specifically for VTOL, and current specification has capacity for just four passengers. In contrast to other air taxi start-ups, though, Joby’s vehicle will be piloted. As for performance in flight, Joby claims its aircraft will reach a top speed of 200 mph, can travel 150 miles on a single charge, and is 100 times quieter than a conventional aircraft.
From automobile to aviation: assessing Toyota’s entry into a new market
Through the venture, the aviation firm will now enjoy the obvious benefits of being able to “share expertise in manufacturing, quality and cost controls for the development and production” of its aircraft.
The investment provides a gateway to a new and untapped market for Toyota. Upon announcing the investment Toyota’s President and CEO, Akio Toyoda, declared “Air transportation has been a long-term goal for Toyota, and while we continue our work in the automobile business, this agreement sets our sights to the sky.”
This “long-term goal”, offers an alternative for growth outside of the saturated automobile market.
The barriers facing Joby Aviation
Joby Aviation is targeting deployment by 2023, and to do so, it needs to overcome several barriers that lie outside capital requirements and innovation.
Foremost among these is regulation. For a global operational profile, it will need to satisfy various regulations around the globe but particularly in the two major Northern Hemisphere markets of Europe and the USA. It will be interesting to see where they seek their first certification and approval.
The legal liability issues surrounding scaled up volumes of aircraft flying in a densely populated area are obvious but not insurmountable given that there are already several international conventions that have largely stood the test of time. There will undoubtedly be some amendments needed and almost certainly be some other “local” sensitivities that will need addressing too.
Given that Joby’s aircraft will be piloted, we can assume that it will have a greater advantage in meeting these regulations than those that propose autonomous piloted aircraft. With a global focus upon efforts to decongest the cities and improve public transport the regulatory bodies must surely look upon these ventures with an always critical but sympathetic eye.
The wider benefits
Joby will be using advanced electric motors and this latest investment is likely to see development of super-powered propulsion units and batteries too. In turn, we should also see significant developments in the speed and efficiency of manufacturing.
Leading aviation giants like Airbus and Boeing have already made significant commitments to developing large commercial electrically powered aircraft. Their efforts will undoubtedly benefit from advances made by players like Joby.
It would appear we are at the beginning of a significant shift in industrial innovation and investment as technology continues to advance quicker than we can adapt and regulate in today’s society. Let’s hope that we can adapt for all the right reasons and reap the benefits sooner rather than later.
Jerry is Director Global Business Development at Finance Technology Leverage (FTL). By financing exciting and challenging projects, FTL unlocks the potential of new advances in aerospace. Contact us to learn about how we can help fund your innovation