I’m going to be initiating coverage of Joby Aviation soon, and I felt like the perfect place to start is a quick competition overview between these two main players in the eVTOL space.
Note, this article won’t cover the actual business case for eVTOLs as a sector. I’ll try to cover the business economics at a later date as there are many advantages and disadvantages of eVTOLs compared to legacy helicopters that will go into the analysis. At this time, I’ll try to keep the scope pretty narrow, comparing only Joby’s and Archer’s platforms.
Introduction
Joby and Archer (Figure 1) are two of the main players in the U.S. eVTOL space. Joby, founded in 2009 and Archer, founded in 2018, are taking two very distinct paths to reaching certification & commercialization.
From the founding dates, alone, one might suspect that Joby is well ahead of Archer since they’ve been at this for nearly a decade longer, and that’s somewhat correct, but Archer has made certain business maneuvers in an attempt to close that gap.
Namely, Archer has chosen to use a more modular approach, taking advantage of off-the-shelf components that are readily available and likely easier to certify. Alternatively, Joby has gone the more vertically integrated route, designing and manufacturing more customized components. There are advantages and disadvantages to both. I’ll cover them in more detail further down.
Aircraft Specifications
Progress
Flight Testing
(Note, if viewing on mobile, this chart is best viewed in landscape to expand annotations).
Highlighted in red is the first full-scale demonstration of transition flight for both companies. From this timeline, we see that Joby achieved full transition flight nearly 7 years before Archer. However, it is worth noting that version 1 of the S4 and Midnight crafts may have been at different levels of maturity.
The approach that Archer is taking has clearly accelerated their development timeline - demonstrated by going from company founding to first full-scale transition flight in under 6 years. Much quicker than the 8 years it took Joby.
Certification
Both companies now claim to be in Stage 4 of the certification process. Stage 4 is the phase where the company has to demonstrate compliance with all FAA regulations. Here, they’ll perform (and submit to the FAA) all of the analysis and testing needed to achieve Type Certification. Stage 4 is by-far the most difficult phase to clear.
It’s unclear to me where exactly Archer stands in this process. They began reporting initiation of Stage 4 near the end of 2023, signaled by the following quote in their shareholder letter:
Our focus is now on the last phase of Midnight’s Type Certification program. The FAA calls this the “Implementation Phase” as outlined in FAA Order 8110.4c.
~Archer Shareholder Letter - Q4 2023
Joby reports both their internal progress as well as the FAA’s reviewed progress which naturally lags slightly behind. The chart above reflects Joby's reported internal progress (which I believe reflects documentation that has been internally signed-off on, but yet to be reviewed by the FAA). It’s unclear which metric Archer is reporting, so it’s worth noting that these timelines may not compare quite apples-to-apples.
UAE launch
Both companies have signed agreements with several airlines and nations abroad. The most imminent, for both companies, are expected to be in the middle east.
Operations in the middle east can start prior to U.S. certification. However, they still have to clear the aircraft with the UAE’s own airworthiness governing body, the GCAA. Operations won’t start until the GCAA is comfortable with the respective aircraft platforms.
Both companies are aiming to begin testing in the region summer of 2025, with ambitions of starting commercial operations sometime in 2026.
We’ll see how the GCAA handles Archer’s bid being that they are just now starting the FAA Stage 4 certification process, and have yet to perform a manned hover or transition.
Additional Commentary
Unit Cost
One of the biggest draws of the modular approach that Archer is pursuing is that using readily available components should be cheaper and quicker to market. I’ve seen estimates that pin Midnight unit costs being 20-30% cheaper to produce.
That may be the case. But in aviation, this approach can lead to higher costs downstream. And it’s unclear how much this approach may save, upfront, anyways.
For instance, the Midnight is outfitted with 12 rotors vs Joby’s 6. Archer also has to equip their aircraft with 14% more battery capacity (while still falling well short on range). And then there’s just the raw mass of the aircraft. Archer’s empty weight is 40% higher than Joby. This additional mass represents simply a higher bill of materials count - a heavier aircraft just has more “stuff” in it. All of these reduce the unit cost advantage that Archer claims to have.
The obvious downside is weight. There’s an inherent feedback loop for weight and cost in aviation: a heavier aircraft requires more energy to fly, which demands a larger battery pack, bigger or additional motors and propellers, and larger lifting surfaces. Each of these additions further increases the aircraft’s weight, leading to diminishing returns in performance, efficiency, and cost.
Alternatively, this also means that every pound of weight saved (in Joby’s case) leads to compounding improvements on required energy usage. Mature aerospace companies (think of the Boeings of the world) will often spend months and millions of dollars squeezing out every last pound from an airframe. The fact that Archer doesn’t seem concerned about this is troublesome.
The downstream effect is that this manifests into Archer having shorter range and slower flight time, both of which are reflected in the specs table above, and will lead to more time in transit and more time spent charging compared to Joby.
Joby’s lighter weight and faster cruise speed means higher passenger throughput per aircraft. In addition, their smaller planform area means more aircraft can operate per unit of available landing space - a valuable resource in congested cities like New York and LA.
In the end, Archer’s path to market may not actually offer better unit economics, neither up-front nor in-service. The only advantage may simply be time to market, which still may be behind Joby who has a near decade-long headstart.
PR Matters
Aviation is a capital intensive endeavor. Archer management catches a lot of flak for putting so much emphasis on making publicity rounds - most recently signing sponsorship deals with the Olympics in 2028 as well as an appearance on Jimmy Fallon. It’s clearly working. Immediately after the PR blitz, Archer’s market cap exceeded Joby’s by about 20% (more than a billion dollars), despite (seemingly) being two years behind in development.
Being able to hit above your weight class is a huge benefit for companies that need to raise capital. The fact that Archer likely trails Joby, and yet, can raise capital on better terms is a testament to the incredible job that Adam Goldstein is doing.
Business Developments & Future Platforms
Archer has generated a lot of buzz by partnering with defense companies Anduril and Palantir. Both of which offer sort of a “mystery box” buzz for investors.
While both deals are a little short on details, we know a little more about the Anduril partnership. Archer plans to develop a hybrid system for increased range and performance. This project will also offer the potential to reach commercialization without FAA Type Certificate (TC) since the plan may be to only do remotely piloted operations with the craft while in a military (not commercial) setting.
Then there’s Palantir. I believe the hope is that Archer has a deep involvement in the Air Traffic Control redesign. It’s still unclear what their involvement will be, though.
In both cases, my take is that these may split Archer’s focus. Designing a hybrid system in parallel while trying to hit domestic certification targets seems like an unnecessary cash burn at this time. And this applies, even more so, to the potential ATC deal, which feels to be outside of Archer’s scope and expertise.
In contrast, Joby plans to “only” operate air-taxi services and sell their aircraft to trusted partners. Not much excitement, and certainly no right-tail effects to consider at this time.
Joby can always pursue a hybrid system later on with a conversion of their S4 and a Supplemental Type Certificate (STC). An STC is typically much easier once a base platform has been certified - often taking only 18-24 months to achieve for smaller modifications.
Joby does have a Hydrogen electric hybrid that it’s developed and flown. They flew that demonstrator over 500 miles in 2024. While that seems like a fun project, I have my doubts on whether it’ll be a practical solution to long range flight. Either way, it does demonstrate that Joby can potentially pursue other powerplants in the future.
Archer Short Report
At this point, this article probably reads like an Archer smear campaign. Clearly, I’m somewhat biased (though, hopefully I’ve presented a rational case). So here’s my chance to defend them a bit.
Culper recently released a Short Report criticizing Archers progress and their recent PR blitz (which I’ve already addressed as a positive for Archer shareholders) and claiming fraudulent behavior from Archer’s management.
While nothing in Culper’s report is technically incorrect, the presentation isn’t as damning as they make it seem.
One claim is that Archer has misrepresented their progress to investors. The aerospace industry is known for schedule slippages, and being that it’s very much a hardware industry, these delays are never small.
One recent example is the new Air Force 1 variant (VC-25B). That program was launched in 2017 with an initial projected delivery date of 2024. Today, it's looking like 2027 at the earliest (and likely closer to 2029). So they'll end up being 4 years behind schedule on a program that was supposed to take only 7 years - a 50% schedule slip.
And that's Boeing modifying an existing aircraft...not even a new design… We’re talking about a company that’s been in this business since the birth of the airplane.
That just puts into perspective how hard it is for companies like Joby and Archer. They're startups performing their first clean-sheet design, building their first set of manufacturing lines, for a brand new class of aircraft.
Any aggressive timelines should be taken with a giant grain of salt.
All that to say, I certainly wouldn’t short Archer based on the information provided in Culper’s report. They do have a functional aircraft, a war-chest of a balance sheet, and a cult-like fanbase. The most I can say is to expect more delays, which isn’t really actionable from a trading perspective and there’s certainly no indication that Archer is the next Theranos or Nikola.
Prediction Time
It typically takes a minimum of 3 years to go from first flight to type certification. For both of these companies, it’s hard to know where to start that clock since several iterations have been developed and flight testing has been ongoing for years.
If we consider this “start date” to be first full-transition flight of their production-intent aircraft (uninhabited), then it makes sense that Joby is “rounding the corner” in the certification process since they’ve had the S4 operating since 2020.
If that’s the case, Archer likely won’t see TC until mid 2027. And that’s really not considering that there has been a second round of major iterations to Archer’s Midnight platform. In addition, realistic expectations in this industry is to assume a roughly 30% schedule slippage which could tack on an additional year to their timeline. It’s certainly possible that Archer makes it to TC prior to their Olympic bid, but if I were a betting man, I’d put that at about even-odds.
In regards to Joby, they’ve covered 30% of stage 4 in the past year. Being at 60% (internally) complete, it’s reasonable to say that 12 months (minimum) is needed to clear the rest of the way. In addition, the FAA needs to clear everything on their end. I would say a reasonable estimate is that Joby can reach TC in the next 18-24 months. Joby is also subject to schedule risk, but their slippage risk should be measured in months at this point, not years.
To summarize:
Archer Type Certification: 2028+
Joby Type Certification: late 2026+
Helpful. I
ran a report today looking at $ACHR mainly, but $JOBY and a few Chinese competitors as well.
In this space the fact $ACHR has the Andruil/Palantir sponsorships may catapult them ahead even though they seem to be behind in development.