Business News

Uber is promoting its flying taxi enterprise

Joby Lufttaxi eVTOL demonstrator. After more than six years of secret development, Joby Aviation is lifting the lid on its innovative eVTOL air taxi program.

Source: Joby Aviation

The air taxi business is at least a few years away from launch, but there is already consolidation among startups. Joby Aviation, California, which develops all-electric vertical take-off and landing aircraft, is acquiring Uber Elevate, Uber's aviation division.

The move will allow Joby to use Uber's app to offer air taxi rides when the company's plane finally enters service, which could be as early as 2023. Although the terms of the deal were not disclosed, Uber has agreed to invest $ 75 million in Joby Aviation. Earlier this year, Uber invested $ 50 million in Joby as part of the Series C funding round.

"We were proud to partner with Uber Elevate last year and we are even more proud to have you on the Joby team today," said JoeBen Bevirt, founder and CEO of Joby Aviation, in a press release announcing the deal has been.

For Uber, the deal comes a day after the autonomous driving division known as the Advanced Technologies Group was sold to Aurora, a self-driving autostart company.

"Aurora will know exactly what to build, what routes there are, what skills the driver needs to learn to cater to the largest segment of the market and essentially the easiest way to build this technology," said Uber CEO Dara Khosrowshahi, told CNBC's "Squawk Box".

By separating from Advanced Technologies Group and Uber Elevate, the hail giant can save hundreds of millions of dollars that would have been required to develop autonomous hail and urban air taxi services over the next several years.

For Joby Aviation, the integration of Uber Elevate could help the company achieve its goal of offering short trips in urban areas with vertical takeoff and landing planes. Joby's aircraft, operated in conjunction with Uber's Ride-Hail app, could provide customers with a seamless way to use ride-hail services and air taxis in a single trip.

"These tools and new team members will be invaluable to us as we accelerate our commercial launch plans," Bevirt said in a company release.

Of course, Joby Aviation is still a long way from the start. The company has built and is testing an all-electric aircraft that can carry four passengers and a pilot up to 150 miles at a top speed of 200 mph. Joby conducts test flights on a regular basis, but the aircraft has yet to be certified by the FAA. Regardless, Joby hasn't set prices for an air taxi ride, which will be an indication of whether air taxis are really taking off with the crowds.

– CNBC's Meghan Reeder contributed to this article.

Related Articles