VALUE: After Hours (S08 E12): Flying Taxis Are Closer Than You Think – Inside Joby Aviation’s Breakthrough

During their recent episode, Taylor, Carlisle, and Charles Lemonides discussed Flying Taxis Are Closer Than You Think – Inside Joby Aviation’s Breakthrough. Here’s an excerpt from the episode:

[Charles] Yeah, so to my mind, they’re really, really similar stories with important differences. Joby has been working for about 15 years to bring a flying machine to market. And the product is a hybrid between an electric helicopter and an aeroplane.

So it takes off like a helicopter and then flies like a plane. It doesn’t go very far because it’s electric, but it’s quiet, which makes it completely different for urban settings. And Joby’s anticipated market is short hop stuff around cities, very much like Blade does in New York right now, where they take the helicopter to take you to JFK or to Newark.

That’s the type of market Joby sees for their electric flying machine. And that market, you don’t need range. You need to go seven miles.

And the reality is, if you get in a Blade helicopter today at 34th Street, you land at JFK six minutes later, and it’s a fun, beautiful way to make the trip. The problem is it’s exceedingly loud, and they’re expensive to operate, so they’re not very profitable, and they’re intermittent. And they’re hard to get places where you can do it.

The fact that the EV tolls are nearly silent is probably going to be a game changer. Now, this is sort of a story that’s been told for 10 years, and it hasn’t happened yet. So it’s a fair question to ask, like, okay, so this has been a pipe dream, and why do you think it’s not a pipe dream anymore?

But if you look at it and you go to the air shows and the conferences and stuff, there’s been a real industry that has been built around this technology and this idea, and Joby is the furthest along in that space, I’m pretty confident. They have gotten to the place where they’re making aircraft or flying machines, as we speak, maybe one a month, that meet the FAA’s protocol for what they will potentially approve. And they have taken that through the certification process up until the point where the next step is getting the FAA pilots to get in them and start doing the tests that Joby has done on the aircraft.

And the current administration seems very much to back this technology. They’re all for it. They’re all in.

So it makes sense to me that the FAA will be flying those things, if not in two months, in four or six months. And it’s, I don’t know how long it takes after that, but it could be, you know, a quarter or two quarters or four quarters after that, that they approve them, which would be, you know, a huge milestone. And, you know, it’s the first new type of flying machine to be approved.

If it happens, it’ll be a big deal. The stock has gotten crushed over the past couple of months from two things. One, Eurovision concern.

You know, what if they need more capital? You know, the stock was on a tear. Investors were excited about their being close to launch.

They flew their flying machine at the Dubai Air Show, and it’s up and around and no one else’s is. And they have deals in Dubai and the UAE to start service there this year.

[Jake] How much would it cost to go from, let’s say, like, Midtown Manhattan to JFK in one of these at some point? Because that is such a pain to do now through the subway.

[Charles] Jake, Blade does it today for $195. So, you know, for me, if I’m taking an Uber Black, I’m spending $150 anyway.

[Jake] Yeah.

[Charles] You know, $195 and $150. Okay, I still have to take an Uber to get there. And maybe it’s a pain in the neck if I have heavy bags.

And it’s more if I’m travelling with my family of four. But if it’s me with my overnight bag going for a two-day business trip, you know, it doesn’t cost me a bit more to take the Blade. Now, because it runs every half hour, you know, it doesn’t necessarily save me time.

And because I have to get to Midtown and I live and work downtown, you know, it takes me, I need to give myself half an hour to get there. And then maybe the thing leaves within 15 minutes, or maybe it leaves in 25 minutes, or maybe it leaves in five minutes. So it doesn’t save me that much time right now.

But when they’re running, like clockwork, and taking off every five, 10 minutes, and they’re doing it from multiple locations around the city, because people don’t mind a quiet little bzzz taking off, you know, it could be an important amount of people using it. It’s not going to take, it’s not going to change how many cars are on the roads. You know, the number of people using it is not going to change traffic patterns.

It’s not like taking a train with 5,000 people to the airport. But it’s a big enough market that Joby is going to be able to sell as many helicopters as they can make for the next, for the first five years of production. And their plan is not to sell them.

Their plan is to operate the taxi service. Which allows for a totally different revenue range. Because, you know, when you have to sell a $5 million aircraft 100 times a year to make $500 million, you know, it’s harder to get to $5 billion.

Then every time you produce one of those, you’re generating $2 million worth of annual revenues for as long as the eye can see. And the other thing that’s important to consider is that these things work today. They work today with today, not even with today’s battery technology, but they’re working today with the technology that was designed into these batteries two and three years ago.

Because that’s the battery that they showed the FAA they were using to get this thing going. Today’s batteries are going to be more efficient, and three years from now’s batteries are going to be significantly more efficient. So every year that goes by, this thing gets more range, or the next one off the production line will get more range.

And if you upgrade the batteries, they’ll get more range. And so it’s potentially a very, very, very big market. And look, it doesn’t mean that everyone’s commuting with these things.

If there are 50 of them in 50 cities around the world, you get to where you need to be fast.

[Jake] I’m ready for the Jetsons future that you’re describing.

[Charles] It may really be very close. And it’s been coming a long time. It hasn’t happened yet.

But they’re sort of flying this thing in demo flights for the past two years. I mean, there was one flying in lower Manhattan a year and a half ago, and they’re flying them all over the place right now. They’re flying thousands of hours a month, I think, right now.

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VALUE: After Hours (S08 E12): Flying Taxis Are Closer Than You Think – Inside Joby Aviation’s Breakthrough

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