Aerospace and engineering group Rolls-Royce has shut down plans for an electric flying taxi business almost three years after the Spirit of Innovation broke the electric air speed record by recording a 345.4mph flight.
The news was announced in a trading update on Thursday, with a comment saying: “In September, we made the decision to close Rolls-Royce Electrical’s Advanced Air Mobility activities.”
That was in contrast to Rolls-Royce’s enthusiastic launch of the project when it declared: “The Electrical power and propulsion systems will lead the way for Advanced Air Mobility (AAM), enabling silent short and vertical take-off and landing capabilities while lowering emissions and reducing fuel consumption.”
High hopes at one stage
At the time, it said urban air mobility (UAM) such as air taxis and electric take-off and landing vehicles (eVTOL) were due to take to the skies by the mid-2020s, creating a billion-pound market.
The aircraft were designed to carry up to four people or transport light cargo and the urban air mobility industry would “revolutionise intracity travel and supply chains”.
The idea was that, as battery technology improved and new hybrid-electric concepts were introduced, eVTOL would become “even more sustainable and able to fly for longer ranges at higher speeds”.
However, plans changed when former Rolls-Royce boss Warren East left the company. He had been the power behind the project but new chief executive Tufan Erginbilgic was doubtful about the eventual cost and how long development would take.
No takers when division put up for sale
Despite the UK government putting in money to support the project, Erginbilgic signalled last year that the Advanced Air Mobility division was going to be up for sale. When it failed to find a buyer, the decision was taken to close the division down.
In the same trading statement the announcement was made, Erginbilgic said of the company as a whole: “Our transformation of Rolls-Royce into a high-performing, competitive, resilient and growing business continues with pace and intensity.
Business looks good in other areas
“Continued good performance year to date gives us further confidence in the delivery of our 2024 guidance despite a supply chain environment which remains challenging.
“We are also making good progress towards our mid-term targets, with a front-end loaded delivery of profit and cash flow improvements. There is more we still need and want to do, as we expand the earnings and cash potential of Rolls-Royce.”
The company revealed its trading was in line with expectations. The full year guidance for 2024 of an underlying operating profit between £2.1bn and £2.3bn and free cash flow between £2.1bn and £2.2bn remained unchanged, it said.
“We continue to strengthen our balance sheet. This has been recognised by the ratings agencies, all of which now hold us at an investment grade rating, and all with a positive outlook,” it added.
