Joby Aviation (NYSE: JOBY) and Archer Aviation (NYSE: ACHR) both produce electric vertical takeoff and landing (eVTOL) aircraft. These sleek electric aircraft are greener and easier to land in dense urban areas than conventional helicopters.
But over the past 12 months, shares of Joby and Archer have both declined by more than 50%. Investors shunned both stocks for similar reasons. First, the Federal Aviation Administration (FAA) hasn’t approved either company’s eVTOLs for commercial flights in the U.S. yet. Second, inflation and fears of rate hikes are compressing their valuations. Should you buy either of these out-of-favor eVTOL stocks as the bulls look the other way?
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Which company has more irons in the fire?
Joby’s S4 and Archer’s Midnight both carry a single pilot and four passengers. The S4 travels up to 150 miles on a single charge at a maximum speed of 200 miles per hour. The Midnight only has a range of 100 miles with a maximum speed of 150 miles per hour.
The S4 travels faster and farther than the Midnight by using single-tilt-rotor propellers for both lifting and cruising. The Midnight uses two separate propellers for those tasks, which makes it heavier, slower, and less energy-efficient. Joby is also developing a hydrogen-powered version of the S4, which could be charged much faster than the battery-powered one, but Archer isn’t.
Joby aims to become a vertically integrated “transportation as a service” business that manufactures, owns, and operates its own air taxi network. Archer is an original equipment manufacturer (OEM) that sells most of its aircraft to third-party fleets. Joby’s supply chain is also tighter than Archer’s because it uses more first-party components.
Joby and Archer both work with the Department of Defense (DoD), and they have some big commercial investors and partners. Joby’s top backers include Toyota, Delta Air Lines, and Uber. Archer’s partners include Stellantis and United Airlines. Toyota and Stellantis will help them manufacture their eVTOLs, while Delta and United plan to use those eVTOLs to provide airport-to-home air taxi services as add-ons to their commercial flights. Uber plans to integrate Joby’s air taxi flights directly into its platform via its upcoming “Uber Air” service. Both companies plan to launch their first commercial flights in the U.S. and the UAE.
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