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Saudi woos electric flying taxis as Gulf rivals vie to be aviation hub

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FILE PHOTO: Midnight, an all-electric aircraft from company Archer Aviation, is seen at the Salinas Municipal Airport in Salinas, California, U.S. August 2, 2023.  REUTERS/Carlos Barria/File Photo
FILE PHOTO: Midnight, an all-electric aircraft from company Archer Aviation, is seen at the Salinas Municipal Airport in Salinas, California, U.S. August 2, 2023. REUTERS/Carlos Barria/File Photo

RIYADH – Saudi Arabia has begun courting Archer Aviation, following the electric air taxi company’s announcement of a partnership with economic and regional rival, the United Arab Emirates.

The competition between the countries to become the top hub in the region is leading to big spending, benefiting new companies like Archer. Last month, Archer signed a pact with the Abu Dhabi Investment Office for multi-million dollar investments to speed up planned commercial air taxi operations in the UAE.

“Since we made our first several announcements in the UAE that has piqued interest” across the region and especially in Saudi Arabia, said Nikhil Goel, chief commercial officer for Archer.

Now, Goel said Archer was in talks with Saudi on potential partnerships in Riyadh, Jeddah, and some of its multi-billion dollar projects in the kingdom.

Archer Aviation, backed by the likes of Chrysler-parent Stellantis, Boeing, and United Airlines, is developing electric vertical takeoff and landing (eVTOL) aircraft that have been touted as the future of urban air mobility.

The oil-rich region’s deep pockets make it a promising frontier for the eVTOL industry which must also overcome certification hurdles to ensure its future.

Aviation investment

As part of its plan to wean itself off oil, Riyadh is pouring billions into its aviation industry to become a regional hub. It announced an order for 105 Airbus narrow-body aircraft on Tuesday, launched new airline Riyadh Air last year, and announced a massive six-runway airport in 2022.

Long-time aviation center Dubai has announced its own big orders and has plans to boost Dubai International Airport’s capacity to 120 million passengers a year by 2026, up from 100 million today.

The eVTOL industry is growing fast and promises to redefine urban transport. But analysts and industry leaders say only a fraction of the 200 or more startups is expected to survive the competition.

The United States’ Federal Aviation Administration (FAA), gave Archer the green light for flight testing of its demonstrator aircraft ‘Maker’ in 2021.

But certification deadlines for eVTOL makers keep getting readjusted, underscoring the challenges that need to be addressed in the nascent sector.

The Gulf offers the possibility of a quick launch, although Goel said all safety requirements would be rigorously respected.

NEOM, the kingdom’s flagship giga project, has already launched a joint venture with eVTOL company Volocopter in 2021 and invested $175 million in the company in 2022.

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