Electric air taxi startup Lilium goes public on Nasdaq

Daniel Wiegand, Lilium CEO, talks the company's $830 million IPO merger with Qell.

Video transcript

AKIKO FUJITA: Air taxi company Lilium beginning trading on the NASDAQ today under the ticker LILM. The German firm is just the latest electric aircraft startup to enter the public market. It is raising more than $580 million in a SPAC merger with Qell acquisition group.

For much more on that, let's bring in the CEO of Lilium. We've got Daniel Wiegand joining us from the NASDAQ today. We've also got Yahoo Finance's Brian Sozzi joining in on the conversation. Daniel, congratulations on the listing. The company is six years old. You've got commercial operations not set to begin until 2024 right now. Why was this the right time to go public?

DANIEL WIEGAND: Thank you for having me. And hi. So Lilium is developing the world's first entirely electric, fully battery-powered vertical takeoff and landing jet. It's a seven-seat aircraft, and we're using these airplanes to enable people in the future to have a radically new means of high speed transportation, flying these airplanes from one city center to another city center.

And since they're vertically taking off and landing, they can actually operate without a runway from simply a helicopter pad. This transaction now puts us into a great position because we're very well-funded over several years now, and we can use those proceeds to progress the design of the aircraft, the certification, as well as the commercialization and setting up the manufacturing environment for these airplanes. Being in that opportunity is amazing for myself and our team. And that's a big day for us, of course.

BRIAN SOZZI: Daniel, why a propulsion-based system?

DANIEL WIEGAND: So the technology we're using is unique in the market. There is a propeller technology using electric propellers. We have developed electric jet engines for our aircraft. And these enable us with two crucial advantages for our business.

The first one is they are much smaller than propellers, so they're more compact and that allows us to make bigger airplanes with more passenger capacity and still operate from the same confined infrastructure. And that helps us distribute the cost of pilots and landing fees over more tickets, and it's the core of our mission to drive down the prices of this service to make it available to everybody.

The second advantage of the electric jet technology we have developed is that you have acoustic liners in the ducts around the fans, and these capture and dissipate the noise of the fan before it propagates into the environment. And this way, we achieve a crucial advantage for the acceptance of the communities which we want to serve with our transportation service.

ZACK GUZMAN: Yeah, I mean, the technology has a lot of people looking at it. You guys, obviously, aren't the only ones in this space developing it. But when you look at maybe, you know, the confidence there and what it should look like, you know, through the SPAC, Qell's shareholders selling a lot more than what people expected in the deal-- less money raised than what you guys announced earlier this year. What does that say about maybe the confidence investors have in you guys being the one to win in this space?

DANIEL WIEGAND: Yeah, that's a great question. So first of all, we are actually the only ones using electric jet technology in the vertical takeoff and landing market. And it is true that redemptions in the last couple of months have continuously grown. This actually says more about the status of the market right now than what are they saying about these companies.

A great company is going to be a great company. There will always be market volatility, but we are here for a marathon. We're here for the long run. It's not a sprint.

And we're heads down, we're fully focused on delivering this jet aircraft over the next several years. And we're now very well-funded to do so.

AKIKO FUJITA: Yeah, a lot of investors may be betting on the long-term potential, but to Zack's point, we've seen a lot of SPAC mergers, especially in the EV space, that have not necessarily gone well. They haven't had a product on the market. It's been riddled with delays. There are some investors who are concerned about a note back in 2019 that seemed to suggest that you could run out of money in the next year or so. I mean, I wonder if you can speak to those concerns and whether, in fact, that's the reason why you needed to tap into the public markets to raise the money now for the long haul.

DANIEL WIEGAND: So, obviously, I cannot speak about other companies. But what I can say is that we have very strong long-term investors on board. All our existing investors are rolling over. They're very excited. We have new investors coming in through the pipe like BlackRock, Baillie Gifford, Tencent is there again, the Lichtenstein Bank, Palantir, Honeywell, who is a strong supplier of ourselves.

There's a very strong support for this ecosystem. And we're very confident about the future here, because basically, the decarbonization of aviation is both crucial for the planet. And at the same time, it's inevitable. And there's millions and millions of people moving into cities every day, every year, and we have to find better ways how we can serve them, how we get high speed transportation into these cities to serve those mega-cities of the future. And that's where we are exactly focused on.

BRIAN SOZZI: Daniel, do you have firm orders in place for your aircraft?

DANIEL WIEGAND: We have a partnership announced very recently with Azul, the Brazilian carrier, who are intending to buy 220 of these jet aircraft. And then on the other side, we are serving a business model where we build our own service, where you can actually fly under our own brand. And here, we have very strong partnerships with Tavistock and Ferrovial, the airport operating and building companies, who have committed $200 million to build 14 exclusive landing sites for Lilium in Florida where we are going to launch our service in the US in three years from now.

BRIAN SOZZI: And if I'm correct here, each aircraft has 72 batteries on it. That's a lot of batteries. Certainly, the market for battery, it's red hot-- I mean, there's batteries shortages because of the push into electric vehicles. Have you locked in any supply agreements for your battery production?

DANIEL WIEGAND: Yes, we have locked in our battery supply agreement which we have announced recently. It is Custom Cells, a German-based company who are producing a high tech battery cell for us. They also produce similar technology for Porsche. And we have tested this technology over about the last 12 months, so we know the cells very well in their capabilities of energy, power, lifetime, safety, et cetera. What we're focused on together with Custom Cells over the next two years is the industrialized version of these cells and actually hitting an aerospace quality standard in this production.

AKIKO FUJITA: Lilium CEO Daniel Wiegand, appreciate the time today. And our thanks to Brian Sozzi as well for joining in on the conversation.