The Munich air taxi startup Lilium is facing significant liquidity problems and urgently needs additional funding to continue its planned operations. According to the company's half-year report, quick capital raising is essential to achieve the market launch of its eVTOL aircraft in 2026. Otherwise, cost cuts, reduced operations, or even insolvency are threatened.
Just a few months after the capital increase in May, during which Lilium raised $114 million from investors such as Atomico, Earlybird Venture Capital, and Tencent, the startup's financial situation appears increasingly strained. The two-year-old company reported a net loss of 87 million euros in the current report, significantly better than the 385 million euros loss in the previous year, but still alarmingly high.
To meet immediate liquidity requirements, Lilium has received commitments of around 32 million euros from existing investors. However, a significant portion of this funding depends on the approval of the German federal government for a convertible loan of 100 million euros, which is to be provided in partnership with the Free State of Bavaria. Without these funds, the company may be forced to take drastic measures.
Lilium is not the only company in the electric flying taxi sector facing financial difficulties. Already in April, the German competitor Volocopter warned of the risk of insolvency, but managed to secure an undisclosed amount shortly thereafter. Christian Bauer, Chief Financial and Commercial Officer at Volocopter, stated at the Sifted Summit that the industry, after the 2021 hype during which around 10 billion euros flowed into the industry, now has to operate with only about one billion euros per year. "Now everyone is fighting for this one billion," said Bauer.
The difficulties in raising capital for hardware-focused, pre-revenue companies like Lilium reflect the changing investor landscape. While enormous sums were invested in promising technologies in recent years, the available funds are now significantly scarcer, intensifying the competition for financial support.
Lilium, which allows its flying taxis to take off vertically with electric propellers, positions itself as a pioneer in the rapidly growing urban air mobility market. However, the planned market launch in 2026 largely depends on whether the company can secure the urgently needed funding. Otherwise, the ambitious flying taxi revolution project could fail, which would have far-reaching consequences for the entire industry.
