Toyota To Invest $500 Million In U.S. Electric Flying Car Maker Joby Aviation
by Zinnia Lee · ForbesJapanese auto giant Toyota Motor is investing $500 million in Joby Aviation to support the U.S. electric air taxi company’s launch of commercial passenger services, which are slated to begin as soon as next year.
Already Joby’s largest external shareholder, Toyota’s investment is on top of its $394 million capital injection in the company in 2020, the two companies said in a joint statement on Wednesday. The fresh funding will be made in two equal tranches, with the first one expected to close by the end of the year and the second in 2025, they said. The investment, subject to regulatory approvals, will be made in the form of cash for common stock.
Joby will use the proceeds for the certification and commercial production of its electric air taxis, according to the statement. The New York-listed company has said it’s aiming to start commercial services in Dubai in late 2025, flying passengers from the Dubai International Airport to the iconic tree-shaped artificial island of Palm Jumeirah. Its aircraft, pending approval from the U.S. Federal Aviation Administration, is designed to carry four passengers plus a pilot at speeds of up to 200 miles per hour. It has previously flown more than 150 miles on a single charge in a test flight.
“With this additional investment, we are excited to see Joby certify their aircraft and shift to commercial production,” said Tetsuo Ogawa, the president and CEO of Toyota’s North American operations, in the statement. “We share Joby’s view that sustainable flight will be central to alleviating today’s persistent mobility challenges.”
Toyota in 2020 led Joby’s $590 million Series C round, which saw participation from investors including Intel Capital and Baillie Gifford, a Scottish investment firm that has backed tech giants Amazon and Tesla. Joby has previously also attracted investments from SK Telecom, the South Korea telecommunications behemoth controlled by billionaire Chey Tae-won, and Uber Technologies, among others. The 15-year-old company went public in 2021 through a merger with a blank check company that valued it at $6.6 billion.
Toyota, the world’s top-selling automaker, has in recent years been making bets on futuristic transportation technologies, hoping to eventually add them to its lineup that include electric vehicles and hybrid cars. Its Silicon Valley venture capital arm, Toyota Ventures, has invested in U.S. self-driving shuttle startup May Mobility and Ion Storage Systems, a U.S. manufacturer of solid-state batteries, which promise increased energy storey capacity for electric vehicles.
Morgan Stanley has said electric flying taxis could be a more than $1 trillion market by 2040. Other companies that are also betting on the nascent space include South Korean conglomerate Hanwha, which has backed U.S. air taxi developer Overair, and Chinese tech giant Tencent, which has invested in German rival Lilium.