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Joby Aviation Investors Hope to Avoid Lilium and Volocopter Fate
The recent insolvency filings by Lilium Air Mobility and Volocopter have sent shockwaves through the electric Vertical Take-Off and Landing (eVTOL) industry. These companies, which aimed to revolutionize urban air transportation with their flying taxi services, have become cautionary tales for investors looking to avoid a similar fate.
One such company that is keenly aware of this risk is Joby Aviation. Despite its own eVTOL project facing significant regulatory and technological hurdles, the startup has managed to secure substantial investments in recent times. However, as the dust settles on Lilium and Volocopter’s financial woes, it is clear that even those with significant backing are not immune to the challenges of bringing eVTOL technology to market.
As I have observed, Joby Aviation investors hope to avoid the same fate as their fallen peers. This sentiment is reflected in the company’s recent stock performance, which has been marked by increased volatility. The $10.72 high and $4.50 low in a single year are testament to the unpredictability of investing in this space.
But what can Joby Aviation do to distance itself from Lilium and Volocopter’s failures? For starters, it must prove an achievable return on investment (ROI) and breakeven time horizon. This is no easy feat, considering the significant regulatory hurdles that remain and the lack of a proven end-user business model.
In other words, Joby Aviation must demonstrate that its eVTOL project can generate profits in the long run, while also addressing concerns about the feasibility of such services in the real world. Until then, investors will likely remain skeptical, and the company’s stock performance may continue to be marked by wild fluctuations.
Furthermore, it is essential for Joby Aviation to address the uncertainty surrounding its operations. The recent downgrading of Joby’s stock outlook by JP Morgan analyst Bill Morgan serves as a stark reminder that even those with significant investment backing are not immune to setbacks and challenges.
Ultimately, while it may be tempting to dismiss Lilium and Volocopter as cautionary tales, their failures serve as a harsh reminder of the risks involved in investing in eVTOL technology. For Joby Aviation investors, the hope must be that their investment will not follow a similar path, but rather become a beacon of success for the industry as a whole.
This article was written by Brian Foley.
Source: www.forbes.com
