Lilium insolvent

The German company has been at work for years on an electric vertical takeoff and landing prototype powered by ducted electric fans in tilting wings. Lilium had hoped to bring its multi-motor "jet" to market with the first wave of eVTOLs.

Lilium's fiscal distress was triggered by the denial of a guarantee for a 50 million-euro loan from the Kreditanstalt für Wiederaufbau by the German parliament’s budget committee. The Greens, Germany's environmentalist political party, voted against the approval. Self-administration, a feature unique to German bankruptcy law, “aims to preserve and continue the business that is the subject of the proceedings. Management would retain control and would continue operating the business under the supervision of a custodian.” However, it is unclear if the court will approve the request. Currently Lilium is unable to finance the continuation of business operations.

Lilium CEO Klaus Roewe said, “Our plan was to obtain shareholder investment in a new funding round anchored by a German government backed loan" of about $109 million. The German parliament did not approve a loan guarantee, and the Free State of Bavaria then removed its own loan guarantee.

Lilium prides itself on having conceived the first eVTOL aircraft with zero operating emissions, according to its website, and the ability to take off from existing heliports or landing spots. The ducted fan technology reduced noise, and the company maintains it will be faster, and carry more passengers (up to six), than current competitors.

The first flight of the Lilium Jet was planned for early 2025 and based on its success, Lilium was hoping for more investors and pre-delivery payments “to finance the company into 2026.”

According to a report in the German TV news program Tagesschau, Roewe said, “initial investment is too big to be lifted by a private company alone.” He said that China and the United States supported the development of electric aircraft with non-repayable loans. Lilium had secured and spent about $1.5 billion from private investors. At the time of this writing, Lilium’s shares traded for $0.073, down from a peak of $14.27 in 2021 according to Nasdaq.

The company was in talks with the French government, which had pledged considerable financial support, should Lilium establish “a battery factory and an assembly line” in France.

Most recently, Lilium exhibited a mock-up of the jet at the National Business Aviation Association’s convention.