Good morning, everyone. Welcome to the 20th Annual Needham Growth Conference. My name is Chris Pierce with the Needham Research Team. It's my pleasure to welcome Adam Goldstein, CEO, Archer Aviation. Why don't you give us 30 seconds to on company history, why you decided to start the company, then we can move into some quick fireside Q&A, and we'll save some time at the end for investor questions as well.
Great. So we build electric aircraft, sometimes called eVTOLs, electric vertical takeoff and landing. They're designed to travel in and around urban environments. You can think about it as almost like a structurally better helicopter: safer, quieter, lower cost. There are both civil applications and defense applications. Started the company back in 2018, fairly well mature at this point. Company's based in San Jose, about 1,300 people. Manufacturing is in Georgia, right outside of Atlanta, in a town called Covington. And the goal is to start flying these aircraft in the big airspace here as soon as possible. On the civil side, we need FAA certification. On the defense side, you need more of a military airworthiness to do that. Different kind of perspective. And with that, turn it back.
Cool. So, calendar turn. Let's talk about 2025. Successes, challenges, anything you want to share on that front? And then we can talk about 2026 and what's up next.
Sure. It's funny. I was just thinking about this. If I was sitting here in 2018 thinking about 2026, I said, what are the hardest things we have ahead of us? I would have said probably regulation. I would have said capital. Building airplanes is definitely not cheap. That's a very expensive journey to go on, but both actually have been, I think, surprisingly very positive, so it started with the last administration on the regulatory side. They created a new category for us. They called it powered lift. They put a lot of the core rules in place, and even the FAA has largely closed most of the specific rules to Archer now, which has been, I would say, very, very positive, and the capital side, we've had kind of the good fortune of strong capital markets as well.
The core technology of these aircraft has been around for a long time, about 20 years. And so people have shown you can fly these aircraft. They can take off and land vertically. They can transition. They can do everything they've said. Archer has shown that stuff too. I think the challenge has been you have to figure out how to really marry the performance against the manufacturability against the certification. That's always the challenge, is how do you make all three of those work at the same time? Because they're competing. And so if you want to make something that has great performance and you take it to a regulator, they ask you to do things like stiffen the wing, which adds weight. Or they'll say, we need redundancy in that system, which adds weight.
You're really trying to balance the certifiability of these aircraft against the performance of them. That's, I think, the challenge. Manufacturing also is really hard too. How do you build a lot of this stuff? Today, we don't build very many airplanes in this country at all. In 1944, we built upwards of 100,000 in a year. Today, we build less than 5,000 across the whole industry. Building airplanes is really tough, especially with a lot of even Boeing challenges. The 787 was the last big composite airplane that was built. That was 20 years ago. We had a generation of lost new composite designs that never got done. Lots of challenges, I would say. How do we scale the industry and manufacturing is definitely hard.
We'll go.
Maybe I could do 2025 too, just to help give more perspective, so 2025 was very much about how do we actually create the path to go to market, and so if you show the planes can work, they can be certified, they can be manufactured, but how do you actually get it to market? That's the tough part, and so we spent a bunch of time on this, very specific timelines, largely because in 2025, Archer was awarded the exclusive for them to become the air taxi partner in the 2028 Los Angeles Olympics, so that was a chance for us to showcase these aircraft on a big major scale, but how do you actually close that gap of where we are today versus how do you get to some kind of scaled version of flying these things in and around a city?
We went to the White House and we talked to the Secretary of Transportation. We went to the CTO of the White House, Michael Kratsios. We came up with a pathway to help start the commercialization. That was through an executive order, which was called the EIPP, the eVTOL Integration Pilot Program. That's something the whole industry gets to benefit from, where they're going to pick a bunch of cities and actually show and let us start flying in 2026. 2025 was about establishing that. That was a big deal for the industry because it gave us a path to fly these aircraft in and around major cities, not just as Archer, but as an industry, to, I would say, reduce the pressure from the FAA. That's not like an all-or-nothing thing. It's going to happen or it's not going to happen.
You're going to start seeing these things flying around in 2026, which was a huge, I think, deal for the industry, and then showing that this year is going to be a big deal.
So let's talk about 2026 then. You have applications in there, what you can or can't say, but you've got an airport now. So setting up Los Angeles as your home base for the EIPP seems logical. What are you going to be flying in 2026? I mean, I know you've got your CTOL aircraft up there now. How should investors think about timing of EIPP applications, when aircraft could be in the sky? What are we just seeing piloted test flights? Are we seeing piloted passenger test flights? What are we seeing and when are we seeing them? And how does that play into 2028 in Los Angeles?
Yeah. So we will fly all the piloted eVTOL transition flights this year. That's all very much on the path. We did have a long CTOL campaign, longer than I would call it expected, wanted. But that campaign has largely come to a close at this point as we're now starting to ramp the eVTOL campaigns. So we'll fly the full mission profiles this year, showing that. The EIPP, I think it's public, like the states that we applied: California, Florida, New York, specifically Huntington Beach, which is right where Hawthorne is. So kind of some of that stuff was out there, I think, well documented. It's the big cities that everybody would expect where we'd want to fly. But yes, Los Angeles is important to us because we did buy the airport of Hawthorne, which is going to be our hub for L.A.
By the way, that acquisition was pretty much out of nowhere. We weren't planning, trying to figure out how to buy that airport. That was a group that owned that airport, had a tax thing, and they came to us and said, "Hey, would this thing be interesting to you?" And it was just a very fortunate scenario where we could own an 80-acre airport in the middle of L.A., two miles from LAX, two miles from SoFi Stadium. So if you think about the Olympics coming up and just L.A. in general, it's a great hub. And not just hub for Archer, but hub for the industry because we'll make it very open to the industry to come fly here. And we've done a good job of partnerships with a bunch of the big venues all throughout: SoFi Stadium, Woodland Hills, a bunch of other ones.
And so it's, I think, going to be a very, very important market for us, a very important market for the industry, probably the best city in the country. L.A., obviously, tons of traffic, lots of people drive. And so that infrastructure is going to be super important.
Okay. And that infrastructure helps you, and the EIPP helps you get everything in place for 2028, sort of kind of laying the groundwork. And then can you take that and replicate it in other, I know you've got the applications in other states as well, but it all sort of sets up a playbook for getting these things in the air, that type of thing?
Yeah. I think a big part of the deployment is getting the general public comfortable with what we're doing. And so how do you not have one of those scenarios where everyone's rejecting you? And so think of, remember, Bird scooters, and they would drop them off in the streets everywhere, and everyone was super anti that, and they just were mad about it. If you look at more like what Waymo did, even they had troubles trying to get that stuff rolled out, just general acceptance, but it largely worked. And it's like now in the Bay Area, where I live, you see them every day. You don't even think about it anymore. It's just part of everyday life. That's what we need to do as an industry for eVTOL.
And that's what I think a lot of the EIPP has the potential to do, which is to just normalize this stuff. You see them out there. No one's questioning the technology. Just look outside. They're flying around. Multiple companies. It's not like the technology is questioned. So that, I think, just reduces the pressure on all this stuff. And I think that's going to be the biggest part of what it does. It's just going to help consumer confidence that this is a real product that's coming.
And have there been any surveys about consumer awareness, consumer readiness, consumer enthusiasm? How do you think about, I mean, if you tell consumers they can save X amount of time, that seems like something people would be very on board for. So I'm just kind of curious where the pushback or enthusiasm, how does it all sort of shake out?
I saw the survey that said it was like 25% early adopters would take no problem, 50% were not sure, and 25% said no. And so if you just think like the top 25%, we couldn't build enough aircraft to satisfy that group. I mean, how many can we build? And that's where I'm excited for the conversation to go, not in this talk, but just in general, how many aircraft can you build? Instead of like, is this real? When are you going to get certified? It's like, no, how many can you build? And then, of course, how do you make this stuff profitable? How do you do it profitably and show that this is a real sustainable business? And so I think about it as we were in this stage like, does the technology work?
Once that gets proven, it's like, okay, you need to get to this base of revenue, like the Rocket Lab of the world. Those are like $1 billion of revenue-ish. We need to show as an industry we can get to that first core. You can fly in the product. You can see the product. It generates revenue. The margins aren't terrible. And then, of course, the next stage is making sure you're a long-term sustainable business.
Okay, so investors sort of have it kind of right then. Can it fly? Does it fly? Show me it flies. How many can you build and when, and that's sort of what you're trying to kind of lay the groundwork for in 2026 and beyond.
Yeah. I think the other sides in 2026 are defense. So with Archer, we've talked a lot about defense because we have a big defense partner in Anduril. And so Anduril is our partner there. And we've done some great stuff with them, I would say, more in building, but we haven't shown that to the world. And so it's very hard for an investor to look at Archer and say, how do I value that? How do I give you credit for that even? I don't know what to do because I haven't seen anything. I hope to be more forward-leaning in that this year and to start showing that stuff. So we did, as an example, you have to read to find these things.
So we did put out a press release with Anduril at the end of last year where we had built some stuff with our partner in GKN. And we did some stuff in the U.K., building out supply base. And there's a program out there, NYX. And if you look at what that program is, that is an autonomous collaborative aircraft that flies with Apaches. And so that's a program we are involved in, just as an example. And so that is a big, serious program that's being looked at right now. And so I would say that's going to be strategically very important to the West. That's very different than some of the other programs on defense that people are looking at, like contested logistics is an interesting one. That can be a very big program.
The question becomes with contested logistics is, can the eVTOL players compete because our aircraft are so expensive? Meaning I could make a. They call them like the slang for that's like a trash hauler. Could I make a really cheap trash hauler for that? Meaning just put like a tube and sticks and then put our powertrain in there. Why would I have a sophisticated eVTOL aircraft that's designed to pass civil stuff? I need the cheapest thing possible that can do that. And I don't know if that's the platforms that we have today as an industry. So there's different stuff you can look at. I really like our position on the defense side.
Okay. So if we think about things investors can give you credit for, then how should we think about, to the extent it's even been fleshed out, OEM, operator, defense? How do you bucket? How do you decide where to send early aircraft? How do you bucket what's most important?
Yeah. OEM, I would say, is like civil OEM is where we're focused. I personally think you'll make no money in the operating side for a long time. I think that's a very hard business. I think you're going to be so how about different type of framework? How do you value these companies? How do you think about valuing these companies? Because it's like pre-revenue. Well, you can look at it from a standpoint of how much capital does it take to make a hardware company work? I mean, you can look at all the hardware companies, the Waymos, the Teslas, the SpaceXs, the Rocket Labs, whatever. Take a look. And then when are you going to start making money and discount it back? And how do I understand what the IRR is going to be?
Okay, well, if you want to start operating, I'm going to get paid by the drink. Okay, how long is that going to take to extend that period of payback time? That destroys your IRRs if you do the math. Now, it's very hard to do that. So I personally think you have to earn the right to do that. Meaning I have to sell a bunch of planes, make some money, show it's a real business to earn that right. So it's kind of the long game of Tesla. They made cars, and then ultimately they're going to start the service in Cybercab. That's like the 30-year journey, though. That took a long time to get to there. I know we're a little different, but I do think it's similar in that we have to earn that right to operate.
I don't think out of the gate you can make any money operating. I think you have to sell these aircrafts. I think it's a breadth game, not a depth game. I don't think any individual city is going to take like 200 planes. Good luck putting 200 planes in New York day one. That's going to be very hard. Could you put 50? Sure. Could you put 200? I think definitely no. You'll get crushed. There'll be this product for the rich. Look at how the rich have taken over New York. You'll get killed for that. Versus there's 50 helicopters today. This is a more sustainable, quieter, lower-cost version of the stuff that exists today. We're doing New York a favor. That's the same concept all over the world. And then you slowly build that stuff up over time. That's why I think it's breadth. It's not depth.
That's my view. And then the second point on defense is it's a sales model, obviously. And so that game is also hard because the U.S. has said what it needs and what it wants, but it's also like they have to get that stuff budgeted for and those programs. So Archer, Anduril build that risk, meaning we build on our dollar pre-program. That's an advantage in the defense world because the primes don't do that. And so we're not competing, as I can see today, against any of the eVTOL players, just against the primes. And the primes haven't built them. They don't build on spec. So we do have a big advantage there. So the questions become, when do programs get announced? How big are they? How do the acquisitions happen? And that's a big, messy process.
Okay. Okay. You hit on regulation, a little bit of certification, a little bit earlier. Kind of what's the latest you can sort of share there? What's the framework to think about it? And if I said, "Hey, you've got the L.A. Olympics in 2028, so that is a worst-case scenario for certification," would you push back against that? Or how do you think about kind of all those things coming together?
Yes, I would push back against that from the way you phrased it. I think as an industry, that's, I don't want to say best-case scenario, but I would say I think there's a lot of, I don't know what the right words are, hype around certification versus reality. There's several things going on here. There's, again, what thing are you actually going to certify? Tell me the thing you're actually going to certify. I want to know the specs of what it's going to do, and until you tell me that, I don't believe you're actually starting to certify. I don't care what you've done on a cert plan or whatever test you want to say. Tell me the actual thing you're going to certify, and the only reason I say that is I don't believe you're done designing unless you tell me that.
I can tell you literally what we're going to certify because I feel confident in the platform that we have. And so from that perspective, there's start-stop on all this stuff. I can go and TIA a system, which, by the way, we will. I'll go and do that largely because I want to show we can and largely because it's a game of what everybody's playing right now. But that doesn't mean you can TIA the second system and the third system and the fourth system and the fifth system. And so there's all these games that are very hard to see from the investor standpoint. And so part of my job is figuring out how to navigate that, to tell our story, to show we're there. But I think that this is a hard game.
So I actually think that showing the aircraft in 2026 through the EIPP and probably into 2027 is super important to the certification perspective because it gets everybody comfortable that these platforms are stable. Here's my product. Here's what it can do. It's stable. You can see it, and you get enough hours on it through these programs to get the public comfortable. Because I do think it's not just, can I pass a test, an FAA test? That doesn't mean you're certified. Just like the Boeing saying was, it's like, I'm done, you're done, we're done. And so just because I'm done with the test does not mean you're certified. They have to be willing to say, we agree and we're ready to do it. We're comfortable to do this. Groups get stuck for 20 years without getting certified.
So I think a lot of it goes back to that comfort standpoint. So I think what'll happen is we'll start flying the EIPP in 2026. You have the Olympics in 2028, and the goal is to get certified sometime in between there. But I don't think that's a given. I also would be willing to bet that between the big eVTOL companies, somebody, including Archer, by the way, it's a risk for all of us. Somebody gets zero payload that comes out of this because that's how hard it is. It is very, very hard to get the engineering, the manufacturing, and the certification to all work.
So just to make sure I'm on the same page, right now you've got companies out there that have not publicly said the specs of their plane, payload, weight, etc. When we get to the EIPP, that sort of becomes more transparent, or is there a chance for that still not to be transparent? You're still out there next year being like.
The company wants to tell you.
Okay. Okay. But your position is the proof point is flying the plane, or should we expect specs from Archer once the EIPP?
Yeah. We'll absolutely tell you our specs.
Okay. All right. Flight testing, sequencing. Let's see. Flight testing, piloted flight testing, EIPP. How does that all go towards? Is it just the FAA gets more comfortable when there's more aircraft in the air flying on a more regular basis, or is there then that gives them to set up for failure testing? How do you sort of how does that all kind of come together and play together?
I think the EIPP is more towards general public getting comfortable. I think the FAA will get comfortable through the data, but also just their people too. So they'll get comfortable. The more they see the stuff, the more you get comfortable. The less perceived risk there is in the industry, the more comfortable I think everybody will be. Because in the end, first new category in 60 years. How do you know when it's done? There's nobody alive today that certified a thing for the first time in the FAA. So we're all kind of, in a way, making it up as we go. We're trying to figure out how to get through this. We have to make sure everybody's comfortable that this is going to be safe and reliable and that we can get the general public's trust. That's what I think the EIPP is.
So I do think the FAA will get more comfortable through it. And so I do think it's important that multiple of us are flying. I do think that's important. So they can see it's like if there's three companies out there flying a lot every day in these big cities, it's kind of going to start to be hard to deny. I mean, that these products are ready.
And is that different than investors seeing it on FlightAware? Everyone flying kind of every day or the general public or?
Yeah. Again, come see these things flying yourself. It just feels different.
Okay. Midnight. What's proprietary? What's not? What do you use the industry suppliers for? Why did you decide to make those decisions? How did that come together?
My whole concept, it's funny. So I started Archer in 2018. And when I started it, everyone was like, "Man, you started late." The Zee.Aero has been around since like 2009. And Zee was the big player at the time. Zee was Larry Page's company. And so it was like Zee, Lilium was in Germany, Volocopter, and Joby was like Joby Motors for a long time before it turned into like I think they started making planes in 2015. They were just doing motors and powertrain stuff. So it was viewed as like we're starting late. But my whole point when I started was nobody was actually trying to commercialize at that time. Everybody was R&D based.
And so when I talked to Tom Muniz, who's my CTO, who was the head of engineering at Z, I said, "Do you think these things are certifiable and commercializable?" And he said, "Absolutely." And I said, "Well, why are you guys building autonomous only and a lot of 3D printed stuff? That's obviously not going to be certifiable for version one." And he's like, "Well, it's like I don't drive those decisions. Larry Page does, not me. And so I'm building the stuff." So that's when he came over to Archer to come build things commercializable. So if you asked any of you, walk the halls of Archer and ask anybody, they would tell you, "Our strategy is to find the most efficient path to commercialization." I say it on all the earnings calls because it's like a rhetoric that I've beaten everybody.
That has led to decisions of the architecture of the airplane, meaning we are way more conservative than our competitors, way more conservative. And so when you have an electric engine that scales down and you still have to have the same amount of disk area, think like helicopter rotor, right? It still has to have this much disk area. I can shrink a bunch of little ones. Should I have four? Should I have six? Should I have 12? Should I have 100? Should I have 1,000? How do you decide? Well, too many is gets ridiculous, but too few means you have less redundancy. So where's the sweet spot? We chose something on the conservative side, 12, which is very easy to understand.
And even Archer is the only one to date that's shown a very risky maneuver, which is high-speed bank, slowing down, reverse transition, losing an outboard motor. We're the only ones that have ever done anything like that. That is the most dangerous combination of stuff. And the plane survived no problem. It didn't even flinch. It did what it said theoretically. And so we made decisions on the architecture to be conservative, but also on the supply chain to be conservative. So we built our own powertrain because you couldn't buy it. I actually would have considered it. Couldn't buy it. So motors and batteries. We don't make the cell. We pack the batteries and do the software. And then also the software for the airplane. So we viewed core IP, and then we outsourced everything else. Why?
Because as an investor, you can't see how much risk is inside these companies. You just can't tell. It's very hard to understand. The more things you build yourself, the more risk you're stacking. So for example, I use Honeywell's actuators. There's virtually, I don't want to say no risk. There's low risk that those don't get certified. Why? Because it's the same certification heritage architectures they've used on every other plane that you guys fly today. And so the odds of that going bad are much lower than doing it yourself with some new architecture. Same thing with flight control computers. I use Safran's flight control computers that fly around on airplanes every day. The odds of that going bad in the cert process are very low.
Versus build your own new quad-core fancy Silicon Valley computer that I take to FAA that has never seen that before, that tries to understand what that is. Again, the FAA, it's not that you just pass the test. They have to feel comfortable that that thing is going to not fail them, and so they're betting their job on that too. And so we took a conservative strategy from that perspective because my view was survive, get to market. This is only a few players that can actually do it. And if you can do that, then all of a sudden you have a chance to win. You don't have to win on the first airplane. Tesla didn't win on the Roadster. They won on the Model 3. It was like it took them many steps to get there.
So if they would have tried to do the Model 3 first, they might never have gotten there. So that was my viewpoint of get the thing to market, be conservative, make sure you don't die along the way, make sure you always have enough cash, extra cash, kind of cushion, and who knows what's going to happen in the markets whenever that shock is going to hit you so you can survive through all this.
Okay. I think a couple of quarters ago you talked about in your shareholder letter, Golden Line Production. What does that sort of mean? How many aircraft have you started to build? Are you already having supply chain conversations about beyond that? Kind of how does that all come together?
So we built a factory in Georgia, which is the mass volume factory. And then we have sort of a smaller factory in San Jose in our headquarters. The reason we did that is there's a lot of manufacturing engineering that gets done just because you design the product doesn't mean it's manufacturable. Don't forget my comment where performance, certification, manufacturability are all super tied. And so as you have to tweak all these things, as you go through the certification process, you want that manufacturing arm close to you to get it there. Once you have it dialed and perfect, you ship it down to Georgia. It's much lower cost and you print. So that's the concept of what we're doing. We're still in that loop. So we're not in the printing stuff yet phase.
Georgia's spooling up and not hiring the workforce, getting the trade schools going, making sure we're very positively positioned with the town. We're building all that up in Georgia, but we're not mass printing anything over there yet. You shouldn't expect to see that. We're more getting those sort of three things under control to make sure we can start the actual production process hopefully here soon.
Okay. We got about 10 minutes left. Let's take a break. Anybody from the audience have any questions? Or we can keep going up here.
From a powertrain standpoint, for military uses, are you finding that perhaps a hybrid electric powertrain would be more useful for missions that might be longer or need more thrust at certain times?
Yeah. So the history of it goes. There was a lot of lean-in from the Air Force through a program called AFWERX. They tested out a bunch of our stuff. They worked with all the different players. Beta, for example, showed that we could have way higher reliability for an electric aircraft than everybody else. That was like a really huge achievement for the industry. That was really positive. The downsides that we all faced were we didn't have the performance that met the specs that they wanted. So the challenge with it is like a civil product. You can convince the consumer, "Hey, this is going to be a good experience. It only flies this fast or flies this far." For the military, it has to fit into a system. It's like, "I need these specs. It has to cost this much.
It has to do all this stuff." And you have to fit into their system. And if you don't fit into their system, it's worthless to them. And so they found out very quickly we didn't fit into their system as an industry. And so hybrid was the only way to go do this. But then the question is for what application? And so that's where I go back to what are these things going to be used for? And so we all have different theories and perspectives, and nobody's on program here yet. The questions are where the big ones at. So I think we are Archer is focused on some of the biggest programs that exist, which is some of the stuff that I mentioned earlier. I think contested logistics will be a huge business.
Unclear to me that eVTOL is the right application for that, even if it's hybrid, because of the cost. It's very hard in the near term to get the cost down to something that's going to be competitive against a super cheap, either all traditional piston combustion type of thing or a purpose-built super cheap hybridized kind of thing. So the Elroy Air or the whatever, those type of things that exist that are out there. So that's the challenge what's out there. None of us know the answer, obviously, what's going to happen. We're certainly going to try for contested logistics too. We're going to put our stuff in that. But it's like they want minimum 2,000 pounds of payload. That's really hard.
For most of our platforms, that's really hard to do for contested logistics because the volume area of carrying that stuff and then mixed with the batteries against that, it kind of goes back to something that's a bit more heavy fuels oriented rather than the hover capability. You put the batteries in there for the hover capability. So I don't know if it's the right application. Unproven.
Anyone else? Okay. So you talked about challenges being an operator, longer payback periods. That makes sense. Who do you see as your early customers? And think about Archer launch companies or your airline partners. What are they planning to use the aircraft for in the early days?
I think an airline is the easiest one to explain. The basics of it are pretty easy. So take United Airlines. So how does United make money? Well, they fly business class travelers on long-haul flights. So take Newark to LAX. So if you look at a business class ticket, it's probably like $2,000-$3,000. You look at an economy ticket, it's probably like $600. What percentage of the business class tickets go unsold? Generically for the industry, it's something like a quarter. And so if you think about the math for them, they're like, "Okay, what do I do when I don't have someone in the business class seat?" I upgrade a 1K or a Global Services type of person. They're giving their highest value, highest margin inventory away.
What if I could attract a customer that historically I couldn't attract to buy that maybe because they like my time slots better or maybe because I can reach a little bit further away? So if I'm Newark, I can attract somebody from Brooklyn where normally they're just Brooklyn people go to JFK because it's just close. But if I can fly you there in five minutes, you don't really care. In fact, it might be easier to fly from Brooklyn to Newark rather than drive from Brooklyn to JFK. And if I'm United, if I eat the cost of that ticket, say $100, even $100 each way, $200 to sell an extra $3,000 ticket instead of upgrading a $600 person, you can do that math. And that math for the airlines makes sense. And so they look at this and go, "Huh, pretty interesting.
It's actually economical for us to do that." So that doesn't mean I'm going to have like 100 airplanes in New York for United because they can't fill up that much from that model. They will start with a handful, handful here, handful in LAX, handful in SFO, handful in IAH, handful in whatever, all Dulles. All the airlines around the world look at that, do that math. That's interesting. And then also just product differentiators. Okay, well, what if Delta does that to me? I got to stop them just recruiting my best people. I got to do it on the defense side too. So you can start to understand the basic models there. There's other things. Anything you use helicopters for, hospitals, VIP, tourism, all that stuff should theoretically use eVTOLs because they're safer and lower cost. I don't think noise sells.
I think people don't really care from a buying perspective. I think it's a scaling factor. I mean, I just can't put 10 loud things in the air. I can put 10 quiet things in the air, but I don't think people buy a vehicle because it's quieter or louder. I think they buy it because it's safe and because it's the cost. I think that's what people buy aviation for. So that's kind of like my viewpoint of how the airlines would use this. There's other scenarios I think that would make sense too. A hospital is another good example. The majority of time when hospitals are flying their helicopters, which a lot of them have helicopters, are just moving people around, personnel. It's not like rescue missions and long hover missions.
It's largely just moving people around going from San Jose to into the city in San Francisco, those kind of things. And so if I can just give you a safer, lower cost version of that, maybe you don't replace your whole fleet, but maybe one of the two, something could switch. So globally, you look at that, there's lots of stuff to go sell.
Okay. $2 billion. What does that get you? Kind of talked about risk, risk aversion, timelines. How do you decide what's a good investment, what's not? How do you make the decisions with the war chest you accumulated last year?
The core use of cash is just on the internal commercialization projects of the Midnight aircraft and on the defense aircraft. That's the core use of it. Opportunistically, we'll look at things like Hawthorne was sort of out of left field for us. There's been some really good tuck-in things like the Lilium patent portfolio where we bought this defense composite factory right next to Anduril. So there's opportunistic things like that one, that defense thing that we bought. It had a bunch of big autoclaves. It had a bunch of stuff that we needed for test articles where if I was to go buy that, I'd pay a lot more and it'd be like a two-year wait time to go buy that stuff, ship that stuff, set that stuff up. So I could buy it on a discount for nothing. So that was really interesting.
But those are small tuck-ins. I think we're not really looking at anything like that major big today from the cash. Most of it is just used for the core platform.
Okay. All right. Any last call? Questions from the room? Why don't we leave it there?
Thank you.
Appreciate your time. Thank you.