Progress of AAM in 2025 (so far)

The eVTOL sector entered 2025 with a sobering tone. Gone are the days of over-polished narratives and ambitious renderings; the market is now grappling with operational, financial, and technological realities. The most significant disruptions this year originated in Europe, where two once-prominent players faced insolvency. Volocopter, a former unicorn in the industry, was effectively sold for $10 million to Austria's Diamond Aircraft—a company ultimately controlled by China’s Wanfeng Aviation. Meanwhile, Lilium declared insolvency twice within months after a failed acquisition attempt; a promised €150 million investment from Slovak investor Marian Boček never materialized. As of today, no confirmed rescue or buyer has emerged.

Even Airbus, a bellwether of aviation innovation, has announced that it will terminate its CityAirbus program by the end of 2025, citing the stagnation of battery technology. Vertical Aerospace, another notable European player, appears to be on a similar trajectory, despite good progress shown these past months but their funding is thinner than ice, highlighting a broader systemic issue: Europe’s chronic underperformance in venture capital and risk tolerance. This should serve as a wake-up call. Without fundamental structural change, European leadership in AAM will continue to erode.

From Hype to Hardware: U.S. Players Begin Delivering

On a more constructive note, the quieter profiles of key U.S. firms like Archer Aviation, Beta Technologies, and Joby Aviation may signal maturity. These companies have transitioned from splashy marketing to the less glamorous, yet essential, phases of production and certification. They are emerging as front-runners among the more than 200 companies that once entered this space.

To the public, Archer appears to be in pole position, supported by strategic alliances with defense-tech firm Anduril and data analytics leader Palantir. These partnerships suggest potential for dual-use applications, particularly in defense-grade autonomy and urban air mobility software infrastructure. Should these collaborations result in:

• Deployment with the U.S. Department of Defense,

• Early certification of autonomous flight operations,

• Real-time integration of mission-critical optimization tools like predictive maintenance, routing, and scheduling,

  
  

Archer could evolve beyond its current positioning as a speculative eVTOL OEM into a fully-fledged autonomous systems platform with commercial and defense relevance. However, some skepticism remains.

Recent messaging—such as "exclusive rights" to the 2028 LA Olympics—appears to hinge more on branding than operational exclusivity, raising questions about substance versus optics. This contrast becomes even starker when comparing Archer to Beta Technologies and Joby Aviation.

Beta, based in Vermont, and Joby, headquartered in Santa Cruz (outside of Silicon Valley), are more advanced in certification efforts, with Joby notably leading the pack as they expect Type Inspection Authorization (TIA) by end of this year. Both companies maintain a low-profile approach, prioritizing technological execution over media attention. While their conservative communication may be underappreciated by the public, their maturity is not lost on regulators and industry insiders.

Despite near-identical market capitalizations between Archer and Joby, Archer's recent stock surge may reflect strong investor sentiment—though some short sellers likely view the narrative differently. It still has yet to be decided if the Silicon Valley approach or a more low-profile approach leads to more success.

2nd Wave Movers: Strong Corporate Backing, But Slower Pace

The next tier of eVTOL companies—Wisk (Boeing), EVE (Embraer), Supernal (Hyundai), and Honda eVTOL—all enjoy the benefit of powerful parent organizations. Wisk is furthest ahead in autonomous technology but may struggle with timelines; full autonomy is unlikely to enter service before 2035. EVE is perhaps the most credible among legacy aircraft OEMs, with Embraer’s proven engineering agility and pragmatic go-to-market strategy. Supernal and Honda bring robust automotive engineering and volume manufacturing DNA, but remain in early development.

What Is the Supply Chain's Perspective

For all its promise, the eVTOL industry remains underfunded by the supply chain—and with good reason. Even among the top players, risk-sharing partnerships are rare. So why is that?

I recently had a client approach me with the question: “What is your recommendation to create more partnership engagement with our suppliers rather than the current transactional relationship and them asking us to fund every dollar they invest?”

Well, there is not an easy answer to this question—or maybe there is, at least when broken down into a few core challenges:

1. Pre-Revenue and Certification Uncertainty:

• No eVTOL is currently certified under FAA Part 23 or EASA SC-VTOL.

• Revenue models are speculative and subject to high regulatory and operational risk.

• Risk-sharing suppliers are typically required to invest in design, tooling, and production infrastructure well before any cash flow is realized - making it a hard sell.

2. Lack of Scalable Volume:

• eVTOL forecasts vary wildly, and few have credible commitments or infrastructure to support scalable production above 1,000 units/year.

• Without production scale, there's no solid business case for amortizing shared investments.

3. Financially Constrained Supply Chain:

• Residual effects of COVID-19, the 737 MAX grounding, and ongoing delays in Airbus/Boeing ramp-ups have weakened supplier balance sheets.

• Many suppliers are still recovering from past OEM-driven margin compression efforts such as “Partnering for Success.”

  
  

Final Thought: Execution Will Separate Survivors from Casualties

The outlines of the future AAM landscape are becoming clearer. Companies with credible certification timelines, visible ramp-up plans, and strategic funding (especially dual-use paths or corporate parents) are positioning themselves for survival and leadership. However, unless OEMs bridge the viability gap—from certification to profitable scale—suppliers are unlikely to engage in risk-sharing. And if/when the OEMs succeed, another question remains: will the supply base be ready to scale with them?

As 2025 progresses, the eVTOL sector will either validate its long-promised disruption—or consolidate around a few survivors who moved past hype and delivered.