All right. Hi, everyone. I'm Austin Moeller, the Aerospace and Defense Analyst here at Canaccord Genuity. Today I'm joined by Nikhil Goel of Archer Aviation. I guess just for those that are unfamiliar with the story of Archer in the audience, can you talk to them a little bit about the opportunity for urban air mobility and the Midnight eVTOL aircraft?
Yeah. No, absolutely. First of all, thanks for joining today, Nikhil Goel, Chief Commercial Officer of Archer. I've been in the eVTOL industry for about 10 years. Started my career at Uber, where I helped found the Uber Elevate division, which focused on urban air mobility. Uber was really formed out of the need and sort of the vision of taking a look at data across our cities. It was very obvious that demand for movements from A to B was quickly outstripping what we believed to be the road bandwidth that we'd see in the next 10 years. I actually started a helicopter division, ran that business for several years, started working with NASA, who had invented these eVTOL vehicles over 30 years ago. It became very obvious that urban air mobility and distributed electric propulsion would form sort of the next wave of mobility.
I started the Uber Elevate division back in 2016. That's when I met Adam Goldstein. Adam Goldstein, the Founder of Archer, really sort of was able to go put together all the pieces, and more importantly, the team, and said, hey, I'm going to go approach this entire business with a commercial mindset. How do you get to market quickly? How do you bring an eVTOL to cities globally? How do you put together the best team to do that? Tom Muniz, our founding CTO, started building aircraft 15 years ago with Larry Page, and has basically, since that point, built a new eVTOL aircraft every 18 months, including the Archer Midnight aircraft that we are building today. That was sort of the foundation of the company. Fast forward to today, we've raised about $3.3 billion to date. We're publicly listed on the New York Stock Exchange, of course.
We are on track to start. We've already started to deploy aircraft to the UAE this year. We're on track to start deploying aircraft in American cities as soon as next year. Our sort of goal, our North Star here in the U.S., is to get aircraft to scale by the time of the Los Angeles Olympics. We're the official partners of the games. We were chosen for the exclusive partnership to deploy air taxis at the L.A. Olympics. That's kind of our North Star here domestically in the U.S.
What can you tell the audience about the performance of the Midnight relative to peers and the 12-tilt-six rotor design?
Yeah. Tom Muniz, who I was talking about, our founding CTO, I'll rewind a little bit. He started building aircraft with Larry Page about 15 years ago. Larry had this crazy idea that looking at the power cost curve of batteries, you could actually use batteries to power electric flight in and around our cities. He recruited Tom out of the Stanford PhD program to go build those aircraft. He built five generations of aircraft with Larry. Through that process, learned a lot, not just about the performance of these vehicles, but also how you certify the vehicles with the FAA. He helped sell that business to Boeing. It became a company called Wisk. As I mentioned, he joined Adam to go build Archer.
He had the advantage of being able to look around corners and say, not only how do you build the most efficient aircraft, but how do you build one that's built for certification and to get to market quickly? There are a few aspects to it. One is just looking at the business case. There are a lot of trade-offs when you build these aircraft around range, speed, and payload. This is where some of the experience from Uber also helped with it. As you looked at cities, the use case you're trying to solve for is the 20- 50 mi sort of trip. To be economically viable on those trips, you need to be able to carry a pilot plus four passengers plus luggage and do that at a speed of roughly 150 mi an hour. That's how you form the basis for the aircraft.
Tom, with his experience, looked at those mission specifications and said, OK, first of all, you need to be significantly quieter than a helicopter. That's what allows you to blend into these cities. You need to be significantly safer than a helicopter. You can't have any single-fault parts. You have to have full redundancy across the aircraft. You have to have a wing. You have to be able to be all electric from day one. What the math gets you to is a design that looks a little bit like an airplane. It's got a wing like a plane. Instead of one large rotor like a helicopter, you have a dozen electric propellers, six on the back, six in the front. All 12 of those are used to lift the aircraft vertically on takeoff. The six in the front tilt forward and allow you to fly on the wing.
That was the design that we settled on. I think a lot of the industry has settled on similar designs as well. That allows us to hit all the mission criteria I talked about. Again, 100 mi, 1,000 lbs payload, about 150 mi an hour.
Yeah, it definitely seems like the industry is largely decided on the tilt rotor.
Yeah.
Could you detail what the passenger experience on the Midnight would be like, from a cabin space to getting on board, embarking, disembarking, and what kind of luggage that someone could bring with them?
Yeah. Zoom out. Again, the goal is 20- 50 mi trips. It's not super, super short trips. It's also not long trips that are going to be more economically efficient in an airplane. It's kind of the in between. Think JFK to Manhattan. Imagine that you're taking a United Airlines flight from L.A. to New York. You take the flight. Let's say you're in business class and you land. The way that that experience would look is it would be integrated in with United. Assuming you're flying business or you're a loyal passenger, you either purchase the add-on or maybe they gave it to you for free. You land in Newark. You get onto the Archer Midnight aircraft. You're one of four passengers on that aircraft. You take a 60-minute flight into the city. You land on West 30th Heliport .
When you land, there's a car waiting for you there to take you to your final destination. You've done a trip that could have taken you an hour to an hour and a half by car. You've done that full end-to-end journey to your house or to your hotel in about half an hour or less. That's roughly what the journey will look like. We'll have enough luggage space for each passenger to be able to bring a small carry-on. If you've got more than that, either you buy another seat or it would arrive separately for you.
Can we talk about the launch edition agreement that you have with, I think, three different countries now?
Yeah.
Can you talk about the revenue opportunity per aircraft or how many aircraft you might deliver and the revenue you could generate per aircraft to provide to countries to be able to evaluate and test urban air mobility routes in advance of certification?
Yeah. Let me provide a bit of a broader picture on our business model, and then I'll get into some of the launch edition stuff as well. Our model is to sell airplanes first and foremost. We've got an over $6 billion order book that we've announced. We're in the lucky position to work with six of the top airlines in the world. Domestically, we've got a $1.5 billion order with United . It's $1 billion firm plus $500 million options. We have a partnership with Southwest. Internationally, we work with airlines like IndiGo. It's the third largest airline in the world, market leader in India. Japan Airlines, we've announced national partnerships with places like Korea and the UAE as well. We've got a large order book. Many of those come with substantial pre-delivery payments.
United , as an example, has put down a $10 million non-refundable pre-delivery payment as part of their deal with us. We have similar constructs with other airlines as well. That's sort of the long-term business. It's again selling aircraft, which we think is very economically advantageous for us. As part of that, some of the early aircraft that we've built, we have found an opportunity to deploy ahead of certification in international markets. I'll talk about some of those. Overall, those are so far what we've announced is UAE, Indonesia, and Ethiopia. The way that these contracts look, first of all, is with the UAE. The UAE, we've got a very broad national partnership. Mubadala is an investor. IHC is an investor that's an International Holding Company. It's the largest listed entity in the Middle East. We've got some other sovereign sources of capital as well.
What we've done is we've formed a multi-year agreement with the Abu Dhabi Investment Office because the UAE, broadly, as a country, is very leaned into the technology. They want to be one of the first in the world to deploy it. What they've done is they've partnered with us. We've agreed to make Abu Dhabi our launch market. Earlier this summer, we deployed our first aircraft there. We delivered our first aircraft to Abu Dhabi and started flying it in July under what we call launch edition. What that means is it is a contract with the operator. In this case, it's an operator called Abu Dhabi Aviation. It's the largest helicopter operator in the Middle East. That contract is for tens of millions of dollars over the next 18- 24 months, under which we will deploy a small handful of aircraft.
We'll start flying that within the country. An important piece of that is the regulatory involvement because obviously, you need the partnership with the regulator to do it. The federal regulator, their equivalent of the FAA, is called the GCAA, the General Civil Aviation Authority. What we've done with them is we've created a partnership for them to take the existing FAA rule set and create a pathway for us to deploy aircraft in the UAE ahead of other places in the world. That is very advantageous to us. It gives us an opportunity to deploy aircraft early, and it puts us in a place where we expect payments coming from that agreement in the second half of this year. It's a place that we feel like we're lucky to be. What we'll do is we'll take that blueprint and we'll replicate it in other countries.
Ethiopia and Indonesia are the two we've announced. Ethiopia is home to one of the largest airlines in the world, Ethiopian Airlines. It's one of the biggest Star Alliance partners of United . Indonesia, think places like Bali or Jakarta, big, big megacities with lots of congestion. There's roughly a dozen other countries that are interested to an equal degree. We'll talk more about those in the months ahead.
If we just pivot over to defense for a moment, can you talk to us about the genesis of your partnership with Anduril on a hybrid e VTOL drone and what we should expect in terms of timing on the DoD's potential program selection or flight test campaign for that aircraft? I know you can't talk about the specifics of the program, but maybe just a little bit more detail.
Yeah. Yeah. Last year, we announced a partnership with Anduril to build defense aircraft. That's been really exciting for us. A lot of the conversations we have globally are not just about civil use cases, but defense use cases as well. One of the things that's become very clear as we talk to our customers, both sort of America and our allies, is that our first instinct, which was, hey, maybe you put a turbo generator on an existing civil eVTOL, Midnight in our case, turns out that that would not be satisfactory to most of our customers. It gets you more range, but it doesn't quite hit on the other capabilities that our customers demanded. It became very clear you had to create a purpose-built vehicle for the defense applications.
As we looked at that, we said, hey, let's go work with a partner to build the right aircraft for those missions. We haven't shared much more beyond that. What I can share is that one is we're seeing that demand grow globally. Two is we've made a few moves to accelerate our progress there. Recently, we announced two acquisitions we made in the space. One was for a company called MCC, Mission Critical Composites. They're based out of Southern California. It allows us to iterate and prototype much more quickly as we think about what the next defense aircraft looks like. The second was a patent portfolio and critical talent from a company called Overair, which is a spin-off from Karem. That was founded by Abe Karem, the inventor of the Predator drone. Both of those put us in a great spot on the defense side of things.
We'll share more in the coming months.
Exciting. You have a fleet of eight aircraft right now, including the six that are under construction. How many of those might be used for FAA/TIA testing with type-conforming components versus those that you might deliver to launch edition customers?
Yeah. What we announced yesterday on our earnings call is that we're currently building six aircraft. We've got two manufacturing facilities. We've got our golden line in Silicon Valley. That's located right next to our engineering headquarters. Think of that as like our pilot line. That's where we put build, manufacturing, QA, flight testing, all sort of in one spot until we get the new product introduction just right. Our large volume manufacturing facility is just outside of Atlanta in a city called Covington. It's one of the largest aviation facilities in the space. That is intended to be able to produce up to 650 aircraft a year. At a macro scale, what you'll see us do is complete the new product introduction phase in Silicon Valley, move that blueprint over to Georgia, and then start to crank up the manufacturing out of the Georgia facility.
The near-term rate goal there is about 50 per year. That's kind of the macro process we're in. Across those facilities today, we've got six aircraft in various builds of production. Three of them are in final assembly. Some of those, to Austin's point, some of those will go internationally as part of the launch edition program. Some of those will stay domestically, mostly in Silicon Valley towards certification and flight testing. We also have an opportunity to deploy aircraft in American cities as soon as next year. Two of the exciting things that have happened, one is we were selected for the, as I mentioned earlier, we were selected for the exclusive air taxi partnership as the official air taxi partner of the L.A. Olympics in 2028. This goes back to two years ago. The FAA published a paper called Innovate28 .
In that, they laid out the vision that these eVTOL aircraft need to be certified and at meaningful scale by 2028 to serve the L.A. Olympics. Think about it, like the next 1,000 days in Los Angeles, we need to get to a point where we are certified and at scale. That puts the North Star bookend in place. That's been really exciting for us for a few reasons. Just last week, President Trump put in place an executive order commissioning a White House counsel to oversee all security and transportation for the games. That puts real federal oversight around what we're doing and real excitement around what we're doing.
At a local level, we've seen our existing real estate partners like SoFi Stadium and USC, as well as new real estate groups come to us and say, hey, we want to build vertiports to be a part of that puzzle. That puts a really great North Star on it. It kind of unifies both local and federal governments. In the near term, we partnered with the U.S. DOT, the FAA, the White House to issue another executive order back in June. This was the executive order on American dominance in the eVTOL industry. What that did was it put in place what they called the eVTOL Integration Pilot Program. That set out a series of steps for us to deploy aircraft in the U.S. as soon as next year. That's been really exciting.
It's caused the FAA to really put things into hyperdrive and create a pathway for us to do that. Think of those as the two bookends and what you can expect to see here domestically. It's part of the reason why we've been able to ramp up manufacturing.
If I recall, the eIPP, the eVTOL Integration Pilot Program, is supposed to select aircraft within the next 90 days.
Yeah.
The performance period on that is essentially three years, right?
Yeah. I don't remember the exact specifics, but it's aimed to be very, very near term. This administration has been more supportive than any I've sort of seen, at least in my lifetime. They're very, very leaned in and are excited around American leadership here, which means kind of two things. One is fostering all the American talent and capital to create the industry here. Two is to globally export those aircraft all over the world.
Can you talk about the challenges at airports? I've been to Adam's office, and I've seen his essentially diagram of all the different airports where you could put aircraft. Can you talk about the challenges to securing parking spots and runway aprons and taxi areas for operating fleets of eVTOLs at airports and why it's so important to have that first mover advantage?
Actually, most airports have been very cooperative and excited about this. It sort of helps alleviate the need for Ubers and taxis and parking at the facility, which I think is great. I'll say a few things. One remember is we work with two of the big airlines here, so both United and Southwest, which together operate at hundreds of airports across the country. Two is we've announced partnerships at a bunch of these airports, particularly in New York, L.A. , and San Francisco Bay Area. In all of those places, we're doing some really cool things. In fact, I think I just saw this this morning. I think two years ago, Houston, which is a big United hub, put out architectural diagrams for how they're redesigning one of the terminals to put eVTOL landing spots on top of the terminal.
It's a really innovative use of the real estate in the space. There are sort of two ways to think about it. There's the short- term. In the short- term, all these big airports have FBOs. We have partnerships with both Atlantic and Signature , as well as a long tail of other FBO providers. In the near term, what you'll definitely be able to easily do is land in an airport, drive three minutes to the FBO nearby, and then go take off and land from there. In the long- term, our vision is how do you integrate the passenger experience more tightly. As I talked about earlier, maybe you get off your flight, and before you even get into the terminal, you are on your Archer eVTOL on your way to the city. That's more of the long-term vision. We're working towards that as well.
To sum it up, we have, I think, a very favorable relationship with some of the top airports in the country.
Excellent. You touched on FBOs just briefly there. Can you discuss your partnership with Atlantic Aviation on preparing those lounges and vertiport sites for Archer operating there?
Yeah.
What key markets are you targeting to roll out lounges and facilities in, at least initially?
Yeah. The three domestically that we've talked about publicly are New York, San Francisco Bay Area, and Los Angeles. The partnership with Atlantic, similar to the partnership we have with Signature, those are the two big market leaders, pretty similar. There's a few things included in there. The big one is charging. How do you make sure that by the time we're ready to operate out of those facilities, you have electric chargers in place? This is where our partnership with BETA Technologies comes into play as well. We've aligned most of the industry around the combined charging standard, CCS. What we're doing is we're working with Atlantic in unison and Signature to install chargers at those key facilities. Some of those have already started to take place. I don't remember the exact ones, but I'll give you an example. One that's really exciting is like Santa Monica.
It's in a really prime area of L.A. It's somewhere where we could start deploying chargers sooner rather than later. As we think about the Olympics, it'll be a key piece of real estate where you'll want to operate in and out of. Today, a lot of those FBOs are underutilized. It's a good partnership for us. It's a good partnership for the FBO providers as well.
If we think about both the passenger and military applications of eVTOLs, how important is the acoustic and thermal signature of these aircraft, either with eVTOL or hybrid e VTOL, to those different use cases?
Yeah. I'll talk about both of them. The punchline is very important to both. On the civil side, if you ask yourself, why don't we fly around in helicopters today? The simple answer is noise. There are thousands of helicopters that exist across the U.S. In places like L.A., there are over 200 helipads. Barely any of them are used. The reason is because anytime someone tries to fly into any of the helipads, the neighbors all go to City Hall and complain about them. In San Francisco, there are 32 helipads. Only two of them are used, and those are at the hospitals. Even when you fly in to save someone's life, you still get thousands of complaints at City Hall the next morning. That's how much people absolutely abhor the noise around helicopters.
The big game changer with these vehicles is they're 100x quieter when they're in cruise, and they're significantly quieter on takeoff. You can be a lot less disruptive to your community. That's really the big breakthrough with the aircraft. I would say outside of that, if that weren't true, it would be very difficult for this industry to take off. That's the big step change that you get, the noise signature on the civil side. On the defense side, very, very similar. Today, in vertical lift, the incumbent is like this 1960s and 1970s technologies of the Chinook and the Blackhawk. Those are very loud, and they also have big thermal signatures. From a stealth perspective, as we think about future conflicts, they're not very effective. That's where we've talked about these new aircraft that we're making being hybrid electric.
When you're over water or remote areas, you can use heavy fuels to get more range, but then when you're closer to sort of contested areas, you can be all electric.
Can you talk about your thoughts on the FAA's industry day about upgrading the air traffic control network, the $12.5 billion in funding that was provided for ATC upgrades in the Big Beautiful Bill, and how we can improve automation in flight op centers and air traffic control towers?
Yeah. I think it's a big opportunity. It's huge for the industry. First of all, it's emblematic of just how leaned in the FAA is. As I said, there have been a bunch of executive orders that we've seen from the White House around aviation. I mean, supersonic flight, upgrading ATC, etc., etc. They're very, very leaned in. ATC is a part of that. Two is today, there's 45,000 flights per day, give or take, that are governed by ATC. Already, I think the system is struggling to keep up with it. If us and our peers do our job right, I think in the next five years, it's going to be an order of magnitude more movements, particularly in low altitude airspace between eVTOLs and drones, etc.
The current administration is taking a good, hard look at it and saying, how do we upgrade those facilities to make sure that they are modern and can support that level of increased activity? On the Archer side, we announced a partnership with Palantir. We haven't said too much about the work we're doing. We're doing a lot of really great work together. That is focused around AI and how we can sort of build upgrades to the software integration of these systems. Expect to hear more from us. Just at a macro national level, it's a very good thing.
That's very exciting. We will stay tuned on that. I think we're at the end of our time, but thank you so much, Nikhil, for coming and talking to us about Archer Aviation today.
Good, thanks for having me.
Yeah, thanks so much.