00:00We welcome Stuart Simpson. He is the CEO of Vertical Aerospace, that being an eVTOL business.
00:07But it's not just eVTOL anymore, it's going hybrid.
00:09And we're here to discuss with you, Stuart, how you're announcing, I think it's a 1,000-mile hybrid electric VTOL.
00:17So this is all about vertical takeoff and landing, but now in the much longer range.
00:22That's absolutely correct, and thank you for that. That really captures what we're doing brilliantly.
00:27Our background was as an electric aircraft, but we always knew this was coming.
00:31So we're not jumping on a bandwagon. We designed from the start to have the largest airframe in this sector.
00:37More people, more things. Perfect for defence.
00:40Okay. It feels as though initially we captured you as someone who wanted to do quick hop-on, hop-off passenger rides.
00:49But then why make this transition in defence?
00:51What had you hit in terms of milestones to be able to decide that now was the time to add on the hybrid offering?
00:57So we've been working on our hybrid for over 18 months.
01:00So this is something when the board felt comfortable, we can do it, we announced it.
01:06So we always knew it was in the long-term plan, larger airframe, but we've proved the hybrid on the bench.
01:11We'll have the whole aircraft flying with a hybrid powertrain next summer. Incredibly exciting.
01:16When it comes to flying, what you need is sign-off and regulation and certification.
01:20Some might say, look, this movement into the defence space often allows certification to become maybe a little clearer.
01:27Is that tends to be why we see companies such as yours try to offer into the space?
01:32So for us, as I say, always on the roadmap for us, we've got a very clear 2028 certification date for our all-electric vehicle.
01:41This is a slightly different path, may accelerate things a little bit, which is great for us and our shell holders.
01:46But it's all additive to the base case, the kill-all electric aircraft.
01:51So what applications will you find in defence for a hybrid such as yours?
01:55I think all. I mean, people, things, it's all about that and it's stealthy.
02:01So the huge range, the huge payload and low noise signature, low heat signature means this is open to all sorts of applications in the defence space.
02:11Let's talk about where you're from because you've jetted in from the United Kingdom and really you're one of the last European eVTOL and now hybrid offerings standing in Europe more broadly.
02:22Why is that the case? And do you need to come over to the United States for customer base at least?
02:27So we have amazing customers all around the world, including American Airlines in the US.
02:32It's a great partner with them.
02:34Being based in Europe means we certify under the CAA and EASA, which is a very clear standard.
02:40You can double click on it, download the work stack, and we know we can certify in 2028.
02:45Very clear process.
02:47Well, it's as clear as the FAA.
02:50Because often we find that those regulators actually take their lead from here.
02:54Yeah, actually, it's much clearer.
02:55In 2016, EASA wrote a very specific piece of legislation called SC VTOL, Special Condition VTOL,
03:04and that tells you how to certify the aircraft.
03:06Being very precise, 10 to the minus 9, one in a billion, same as a large passenger jet, which is what we think customers need and deserve.
03:15So there is no transition in safety when you get off a large passenger jet across the Atlantic, jump on one of our aircraft and fly downtown into New York.
03:23So you talk about the customer base that's already here in the US from a civil aviation perspective.
03:27But what about from a defense perspective?
03:29Who do you hope to be selling into?
03:31So we can't really talk about that.
03:33We've had deep discussions for a long time with many potential customers, particularly in Europe, because that's where we're based.
03:39And given the geopolitical environment at the minute, it's a really unique selling point.
03:43We are the only player in Europe.
03:45So that gives us a prime position there to capture that market.
03:49We'd, of course, love to sell into the US as well.
03:51Just signed a billion dollar deal with Honeywell last week.
03:53So it positions us brilliantly.
03:55And that's from a supply chain perspective.
03:56Talk us through the Honeywell agreement and what's ultimately being brought to bear with that particular partnership.
04:02Yeah, I mean, at Honeywell, we've worked with them for six years.
04:04So they're deeply embedded, our team and the Honeywell team.
04:08And we've signed up with them to provide basically the whole cockpit of the aircraft, the way the pilot interfaces with the aircraft and tells it what to do, and the whole flight control system underneath it.
04:21So it's fully integrated.
04:22And a huge bonus, you can bolt on autonomy really simply.
04:26So it positions us brilliantly.
04:27Really exciting day last week.
04:29Okay, so when you're intertwining your own technology and that of Honeywell's, how seamlessly does that have to work?
04:34What sort of technological breakthroughs are you having to make at the moment?
04:37Actually, after six years, we've made the breakthroughs.
04:39We've signed the production and certification contract with them.
04:43So we are locked in with them.
04:44We're locked in with another couple of suppliers for production and cert.
04:47And we'll have more announcements over the coming weeks and months on that.
04:50So you really feel that by come 2028, we will have your electric offering in disguise as well as a hybrid one?
04:58Absolutely.
04:59And what's the cost that takes you there?
05:02Have you got that all planned out?
05:03I know that you've been putting out your money.
05:05Well, the statements of how you currently are seeing net operating cash flow outflows.
05:10Do you need to raise more to get to that 2028 level?
05:14Yeah, absolutely.
05:15We cleaned up our balance sheet in December.
05:18And just to bring that to life, I couldn't go to any conferences.
05:22I did one investor conference last year because our balance sheet was not investable.
05:26We cleared that out the 23rd of December, raised $90 million in a couple of weeks.
05:31And when I did that, it was clear we'd raise money again this year.
05:34And what sort of strategic investors or indeed venture investors are you looking for?
05:39So we're looking at all the different verticals.
05:41And I think if I take a step back, what myself, the chairman, and majority shareholder Jason,
05:47the biggest thing for us over the next couple of years would be to land a strategic investor.
05:52Not because we necessarily need one, but it's such a vote of confidence in the future of the business.
05:57And we have seen partnerships.
05:59Joby, for example, is working closely with airlines, with Uber.
06:02But how are you seeing the competitive landscape evolve, particularly here in the United States?
06:07Well, we've got the best aircraft.
06:09We are the only one in the world at the safety standard we're doing.
06:12We are the only one.
06:13So that gives us a unique position.
06:15We've got the biggest cabin I've sat in the others.
06:18We're a little bit smaller.
06:19Ours is big.
06:19We have four executive class seats.
06:22You can expand it to six.
06:23You can take luggage.
06:24We have the best aircraft.
06:26So, yeah, really excited about bringing it to market.
06:29It's only a few short years now.
06:30And when you say that you've got the best safety standards, who is the judge of that thus far if we're still awaiting CAA approval, FAA approval?
06:40It's the regulating.
06:42The CAA and EASA have defined these aircraft to be as same as large passenger jets, the same level of safety.
06:49Because this is mass transport.
06:50The goal is to have thousands of these flying.
06:52So you really want to have the highest level of safety.
06:55And that is definitively 10 to the minus 9.
06:58The FAA is at a slightly lower level.
07:01OK, so you've ticked that box.
07:03What next in terms of how you continue along the milestones that you've currently set yourself?
07:08We'll be doing some incredible flight testing later this quarter.
07:12And that's already signed off and in the plan?
07:15If we were based in America, we'd be doing it already.
07:17But there's a joint liability in the UK between the regulator and the company.
07:21So to fly in public airspace, which we'll be doing, they need to sign that off.
07:26So it's a major, major step when we do that later this quarter.
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