Stellantis Invests Additional $55 Million In Archer Following Recent Flight Test Milestone
Stellantis has invested an additional $55 million in Archer Aviation, following the achievement of a recent flight test milestone. This investment is part of a broader strategic funding agreement between the two companies, adding to Stellantis' $39 million open market purchases of Archer stock and a $110 million investment earlier in 2023. Archer is nearing the completion of its high-volume manufacturing facility in Covington, Georgia, which will support the production of up to 650 aircraft annually. This facility is expected to be one of the largest in the aircraft industry by volume. Archer aims to transform urban travel with its electric vertical takeoff and landing (eVTOL) aircraft, reducing commute times significantly. Stellantis has been a strategic partner since 2020, providing manufacturing, supply chain, and design expertise.
- Stellantis invested an additional $55 million in Archer Aviation.
- Total investment by Stellantis in Archer during 2023 amounts to $149 million.
- Archer's manufacturing facility in Georgia is nearing completion and will support the production of up to 650 aircraft annually.
- Stellantis' strategic partnership since 2020 has provided valuable manufacturing, supply chain, and design expertise.
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Insights
Stellantis' additional $55 million investment in Archer Aviation indicates ongoing confidence in the eVTOL market's potential. Financially, this investment should provide Archer with the necessary capital to continue its high-volume manufacturing facility's construction in Georgia, which is projected to support production of up to 650 aircraft annually. For retail investors, this investment could signify a long-term growth opportunity, given the strategic backing from a major automotive player. However, it's also important to recognize the financial pressure this project places on Stellantis and Archer.
From a valuation perspective, Stellantis' investment might help stabilize Archer's stock, which could have been under volatility due to its high R&D and infrastructure costs. This is particularly relevant as Stellantis has already purchased $39 million worth of Archer stock in the open market earlier this year, demonstrating substantial financial involvement.
Over the short term, investors might see this as a stabilizing move, reducing some uncertainties. In the long term, however, it hinges heavily on Archer's ability to meet its ambitious production targets and the broader adoption of eVTOL technology. Potential drawbacks include the capital intensity and high execution risk associated with such pioneering projects. Retail investors should weigh these aspects carefully.
The investment highlights the strategic partnership between Stellantis and Archer since 2020, focusing on developing eVTOL technology. Urban air mobility is an emerging market projected to revolutionize urban transportation by offering faster, sustainable alternatives to traditional commutes. The substantial investment suggests confidence in the growth potential of this market.
Archer's manufacturing facility, once completed, positions it strongly within the nascent eVTOL sector, potentially offering a competitive advantage. However, it's essential for investors to consider whether the market demand aligns with Archer's production capacity. The company's goal to transform urban travel is ambitious but hinges on regulatory approvals, public acceptance and infrastructure development.
In the short term, this investment consolidates Archer's financial base, allowing it to focus on meeting production timelines. In the long term, success will depend on Archer's ability to deliver on its promised technological advancements and operational efficiency. There are potential risks, including regulatory challenges and market adoption, which should be considered by investors.
From a technological standpoint, Archer's progress in eVTOL aircraft development is noteworthy. The transition flight test milestone indicates significant advancements towards making eVTOL a viable urban transportation solution. This technological progress, backed by Stellantis' investment and manufacturing expertise, positions Archer well in a competitive industry. However, investors should note that the technology is still in a relatively early stage, requiring further development and regulatory approval.
The collaboration with Stellantis leverages its manufacturing and supply chain expertise, critical for scaling production efficiently. This synergy could accelerate Archer's path to market, but the technical challenges and costs associated with mass production of eVTOL aircraft remain significant hurdles. For retail investors, understanding these technological complexities and the timeframes involved is important for assessing the potential return on investment.
While the investment underscores optimism about eVTOL technology, the long-term success of such initiatives depends on continuous innovation, safety validation and regulatory compliance. Investors should stay informed about technological developments and their implications on the broader adoption of eVTOL solutions.
Stellantis Invests Additional
- Investment from Stellantis under the companies’ strategic funding agreement builds on the
$39 million worth of open market purchases of Archer stock that Stellantis completed earlier this year, and the$110 million investment made by Stellantis in Archer during 2023 - Construction nears completion on Archer’s high-volume manufacturing facility in Covington, GA, which is on track to be completed later this year
AMSTERDAM and SANTA CLARA, CA, July 2, 2024 – Stellantis N.V. (NYSE: STLA / Euronext Milan: STLAM / Euronext Paris: STLAP) and Archer Aviation Inc. (NYSE:ACHR), a leader in electric vertical takeoff and landing (eVTOL) aircraft, today announced Archer has received an additional
This latest investment builds on Stellantis’ series of open market purchases of 8.3 million shares of Archer’s stock in March of this year that was previously announced. During 2023, Stellantis invested
Archer remains on track to complete construction of its high-volume manufacturing facility in Georgia later this year. This first phase of the build out is a ~350,000 square foot facility on an ~100 acre site designed to support production of up to 650 aircraft annually, which would make it one of the largest manufacturing facilities by volume in the aircraft industry. Archer’s goal with this facility remains to establish a factory that can support its planned commercial ramp up by leveraging the expertise of Stellantis as its contract manufacturer.
“Few things rival the excitement of seeing a dream take flight. I applaud the innovation, expertise and hard work of the engineering and manufacturing teams from Stellantis and Archer,” said Carlos Tavares, Stellantis CEO. “With this additional investment in Archer, we remain on course for a future where freedom of mobility extends beyond today’s roads.”
“The commitment by Stellantis to Archer has been unrivaled, from its foresight to provide the manufacturing expertise and capital needed to accelerate Archer’s business objectives, to the strategic vision and steadfast support from Stellantis CEO Carlos Tavares,” said Archer CEO, Adam Goldstein. “Together, we’re working to redefine urban transportation, opening new worlds of opportunity for citizens across the globe by providing more efficient access to people, places, and events across the regions they live in.”
Stellantis has been a strategic partner to Archer since 2020 through various collaboration initiatives, and as an investor since 2021. During this time, Archer has leveraged Stellantis’ deep manufacturing, supply chain, and design expertise in connection with Archer’s efforts to design, develop, and commercialize its eVTOL aircraft.
Archer’s goal is to transform urban travel, replacing 60–90 minute commutes by car with estimated 10–20 minute electric air taxi flights that are safe, sustainable, low noise, and cost-competitive with ground transportation. Archer’s Midnight is a piloted, four-passenger aircraft designed to perform rapid back-to-back flights with minimal charge time between flights.
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About Stellantis
Stellantis N.V. (NYSE: STLA / Euronext Milan: STLAM / Euronext Paris: STLAP) is one of the world’s leading automakers aiming to provide clean, safe and affordable freedom of mobility to all. It’s best known for its unique portfolio of iconic and innovative brands including Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS Automobiles, FIAT, Jeep®, Lancia, Maserati, Opel, Peugeot, Ram, Vauxhall, Free2move and Leasys. Stellantis is executing its Dare Forward 2030, a bold strategic plan that paves the way to achieve the ambitious target of becoming a carbon net zero mobility tech company by 2038, with single-digit percentage compensation of the remaining emissions, while creating added value for all stakeholders. For more information, visit www.stellantis.com.
About Archer
Archer is a leader in the electrification of aviation. We are designing and developing the key enabling technologies and aircraft that are necessary to power the next great transportation revolution. Our goal is for our proprietary technology to deliver unprecedented connectivity to the people and places across the most congested cities in the world. To learn more, visit www.archer.com.
Stellantis Media Contacts
Fernão SILVEIRA +31 6 43 25 43 41 – fernao.silveira@stellantis.com
Shawn MORGAN +1 248 760 2621 – shawn.morgan@stellantis.com
Archer Media Contacts
The Brand Amp - Archer@TheBrandAmp.com
Stellantis Forward Looking Statements
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Archer Forward Looking Statements
This press release contains forward looking statements regarding Archer’s future business plans, including statements regarding its aircraft performance, the planned production capacity and timing of completion of Archer’s manufacturing facility, and the timing of Archer’s development, commercialization, and certification of its eVTOL aircraft. These forward-looking statements are only predictions and may differ materially from actual results due to a variety of factors. The risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed in Archer’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, available at www.sec.gov. In addition, please note that any forward-looking statements contained herein are based on assumptions that Archer believes to be reasonable as of the date of this press release. Archer undertakes no obligation to update these statements as a result of new information or future events.
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