Archer Aviation's Tokyo Dreams: Or, How to Lose Money Flying Over Tokyo Bay
So, Archer Aviation thinks they're gonna be the next big thing in air taxis, huh? Let's be real: aren't there, like, a million of these companies all promising the same freakin' thing? Flying cars, personal helicopters, whatever. It's always "just around the corner."
And now they've got a "partnership" in Tokyo. Big deal.
According to the press release, the Tokyo Metropolitan Government selected a Japan Airlines-led group, which includes Archer, Sumitomo Corporation, and their joint venture Soracle, to join the first phase of Tokyo’s “eVTOL Implementation Project.” Sounds impressive, right? "eVTOL Implementation Project"—bet that cost a fortune just to name.
But what does it actually mean?
They’re gonna "prepare the city for electric air taxi services, using Archer’s Midnight aircraft as the model for early test flights." Test flights. Over Tokyo Bay. With a "model" aircraft. This ain't exactly the Jetsons, folks.
Vaporware Takes Flight?
CEO Adam Goldstein says this is "an important step toward making urban air travel a normal part of city life." Right. And I'm sure those Tokyo commuters, already crammed onto trains like sardines, are just dying for another expensive and probably unreliable way to get to work.
Speaking of unreliable, let’s talk about Archer's stock price. Shares slipped 8.25% on Tuesday, following a 7.1% drop the previous day. Downward trends all around! And this is after the Tokyo announcement. Seems like Wall Street isn't exactly buying what Archer's selling.
I mean, the stock has risen more than 190% in the past year. But that just proves my point: hype sells, even if the product doesn't exist yet. It's the "electric vertical takeoff and landing market," baby! Throw in some buzzwords, and watch the money roll in... at least for a little while.
Oh, and they expect to start recognizing revenue in early 2026. Initial sales will be small, but they expect steady growth from thereon. Steady growth? From small initial sales? That's like saying you're gonna build a skyscraper on a foundation of sand. Good luck with that.
Full-scale passenger flights are planned for 2028. 2028! That's, like, a million years from now in tech time. Who even knows if Archer will exist in 2028?
Financial Red Flags Everywhere
Let's dig into the financials, shall we? Archer boasts total assets of approximately $1.94 billion but carries along substantial liabilities of $257.4 million. Okay, not terrible.
But then you see the steep $206 million loss in net income. Ouch. That's a big red flag waving frantically in the wind. They've got cash, sure—$1.72 billion in cash at the end of June 2025. But they're bleeding money like a stuck pig with operational losses pegged at $103.4 million over the same quarter.
And get this: return on assets at negative 54.74% and return on equity at negative 60.83%. Those aren't just bad numbers; they're straight-up terrifying numbers.
The company’s stock volatility plays its own silent movie in the background, choreographed by a market cap nearing $4.53 billion underpinned by the pivotal price-to-book ratio around 3.67. Translation: it's all smoke and mirrors, propped up by "innovation, venture capital, and R&D commitments." Which, let's be honest, is just a fancy way of saying "we're spending a ton of money on stuff that might not work."
They're even offering 81,250,000 shares of its Class A common stock, expected to raise $650 million. To be used for the acquisition and redevelopment of Hawthorne Airport and other corporate purposes. Translation: they need cash. Badly. Archer Aviation Announces $650 Million Stock Offering
The FAA Problem
And let's not forget the FAA. CEO Goldstein admits that talks with the Federal Aviation Administration are continuing, although progress has slowed due to the current government shutdown. To offset delays, Archer is working with overseas partners such as the United Arab Emirates to speed up its entry into commercial service. Because, offcourse, dodging US regulations by going overseas is a great sign of future success, right?
Then again, maybe I'm just being cynical. Maybe Archer will revolutionize urban air travel. Maybe I'll be eating crow in 2028 as I'm whisked away to work in a sleek, electric air taxi.
Nah. Ain't gonna happen.
This Ain't Flyin' High, It's Burnin' Cash
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