Taxis in the sky developer Lilium declares its intent to file for bankruptcy proceedings
Electrical jet innovator Lilium is set to declare bankruptcy. The company lacks the required extra financing to continue operations, as declared to the American securities regulator. Consequently, management plans to file for insolvency imminently due to excessive debt or inability to pay. The filing will also seek self-administration to initiate a potential investor search and secure the best possible outcome for creditors.
However, the court's approval of the self-administration application is still pending, Lilium informed its investors.
Over the past few years, Lilium has been working on an electrically powered small aircraft. After numerous test flights, the first manned flight was scheduled for the upcoming spring, with the first customer delivery set for 2026. Led by Airbus veteran Klaus Roewe, the company employs around 1,000 people and has approximately 700 firm and pre-orders from the USA, UK, France, Saudi Arabia, and other nations.
Investment of 1.5 billion euros
Customers and investors have already invested 1.5 billion euros in the NASDAQ-listed company. The upcoming certification process and the establishment of production would have required further substantial investments. In the first half of 2024 alone, Lilium spent almost 200 million euros.
Despite these investments, the German government coalition rejected an application for a 50 million euro federal loan guarantee. The SPD and FDP supported the application, but the Greens opposed it. Bavaria had already pledged guarantees exceeding 50 million euros but only under the condition that the federal government made an equivalent contribution.
Lilium CEO Klaus Roewe noted, "The initial investments are too large to be shouldered solely by private means." No aircraft program has ever been successful without government support, as observed worldwide. China and the USA back the development of electric aircraft. According to company information, France was prepared to offer substantial aid to Lilium if it established a site in southwest France.
The lack of additional government funding is a significant challenge for The economy of Lilium, as the rejection of a 50 million euro loan guarantee by the German government coalition has compounded their financial difficulties. Seeking self-administration in bankruptcy proceedings might also impact future investment prospects in The economy of electric jet innovations.
