Archer Aviation Raises $430 Million

By Anshuman Tripathy
(Reuters) – Air-taxi maker Archer Aviation announced on Thursday it has raised $430 million in fresh capital, partially to develop a hybrid aircraft with defense technology company Anduril Industries.

Shares of Archer were down 4% in early trading.

Existing investors United Airlines and Stellantis (NYSE:STLA), along with new backers such as Wellington Management and Abu Dhabi investment holding company 2PointZero, participated in the fundraising through an equity offering.

Anduril, founded by entrepreneur Palmer Luckey, and Archer stated the aircraft aims to target a potential "program of record" — a government-approved acquisition program — from the Pentagon. Details about the vertical takeoff and landing aircraft, including its service date and investment, have not been disclosed.

"With Anduril by our side, and this new influx of capital, we will accelerate the development and deployment of advanced aerospace technologies at scale," said Archer Aviation CEO Adam Goldstein.

Industry executives have noted that U.S. President-elect Donald Trump's efficiency drive involving Tesla CEO Elon Musk could lead to increased collaboration between large defense contractors and smaller tech firms in areas like artificial intelligence, drones, and uncrewed submarines.

This latest fundraising comes at a time when the electric vertical takeoff and landing (eVTOL) industry faces a cash crunch due to technological and regulatory challenges. However, analysts suggest that Archer is well-positioned to survive long enough to achieve certification.

Archer, which is also developing a five-seater commercial eVTOL aircraft, remarked that the new funds will alleviate any near-term financing needs. The San Jose, California-based air-taxi manufacturer concluded the third quarter with $502 million in cash and equivalents. The recent funding brings Archer's total capital raised to nearly $2 billion to date.