Air taxi developer Lilium could file for insolvency – again

Last week, it became clear that the supposed rescue of Lilium with a promised cash injection of 200 million euros was far from a done deal, and employees were still waiting for their January salaries. As the German Wirtschaftswoche now reports, the management of the Bavarian air taxi developer decided at the end of last week to suspend operations until the wages can be paid. “Lilium needs more than ten million euros a month for rent, suppliers and salaries,” explains shareholder Frank Thelen in the report.

Together with entrepreneurs Christian Reber, Jan Beckers and Niklas Zennström, Thelen transferred five million euros to Lilium at the beginning of January, intended as a stop-gap measure. But that does not even cover one month. Instead, the company is primarily waiting for money from its new leading investor, Marian Boček, founder of the Slovakian battery manufacturer Inobat, one of Lilum’s partners. Boček is expected to provide 150 million euros – enough to keep the company running for a few months.

However, the money had still not arrived by yesterday. As a result, the management is said to have informed the staff in a dramatic online meeting yesterday that Lilium will probably have to file for insolvency again if there is no progress on the transaction. It is currently unclear why the urgently needed transaction has not yet taken place. On Tuesday, Investor Boček claimed via the German newspaper Bild: “The rescue is in full swing. […] The first funds were received immediately after the contracts were signed.”

However, even if the rescue still does take place, it could come too late: “Trust has been destroyed too much,” Gründerszene quotes an insider. A significant proportion of the workforce has already looked for new employers. The fact that Lilium has not yet been able to demonstrate a successful manned flight makes the situation all the more complicated.

While the innovative strength of German air taxi developers was once hyped, the winter blues have long since set in. It’s not just Lilium that has problems: German competitor Volocopter is insolvent and looking for a rescuer, and Airbus is pausing its air taxi project based in Bavaria. Meanwhile, international competitors are setting a fast pace: Ehang from China has already carried out autonomous test flights with passengers on board. At the same time, US-based company Archer has received 730 million dollars in venture capital in just a few weeks.

Update 17 February 2024

According to Handelsblatt, the company has not yet had to file for insolvency (again), as previously feared, but the situation remains precarious. Slovak entrepreneur Marian Boček has reportedly promised the urgently needed €150 million in short-term funding, but the money has yet to appear in Lilium’s account. Until then, the company is said to be working on interim solutions, according to sources close to Handelsblatt.

Meanwhile, Gründerszene reports that Lilium employees have been informed via email that the company has not filed for insolvency, as there is still “a way forward” for the eVTOL manufacturer. Further updates are expected as soon as there is “more clarity,” but no later than Monday.

wiwo.de, bild.de, gruenderszene.de (all in German), handelsblatt.com, businessinsider.de (both update; both in German)