Archer Aviation (ACHR +0.93%) has one big goal to achieve over the next few years: approval of its Midnight vertical lift short haul aircraft for commercial use in the U.S. market. This aircraft is basically an air taxi, which is a totally new way of thinking about air travel.
While a vertical lift aircraft doesn't need a lot of runway, Archer Aviation has built an impressive runway for the growth of its business. So does the upstart business make for a good investment today? Let's take a closer look.
The big step for Archer Aviation
Archer Aviation has an aircraft called Midnight. It is starting to formalize the manufacturing process, with as many as 10 Midnight aircraft expected to be built in 2025. This is a great start for a business that is just getting off the ground, with Archer Aviation continuing to cross important developmental milestones off of its list.
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That said, one really important milestone that will take a little longer to complete is FAA approval to use Midnight on a commercial basis in the U.S. market. In fact, most of the 10 aircraft Archer Aviation is building this year are likely to be used for testing. But the FAA process is about getting U.S. approval; other countries have similar, but perhaps not as strict, processes. Which is why the story to watch in 2025 is Abu Dhabi, where Archer Aviation is hoping to carry its first commercial customers in late 2025 or early 2026.
The company inked an agreement to offer an air taxi service in Abu Dhabi in late 2023. So it has taken a few years to get the service off the ground, as the agreement was signed fairly early on in Midnight's commercial approval process. But the company is currently developing a site for the first "verti-port" and setting up pilot training processes in Abu Dhabi. Once it gets the green light to carry commercial customers it should be able to start doing so very quickly.
The next few years could be very active
The Abu Dhabi effort is important in many ways. On the one hand, the company is using it to create a blueprint that it can use in other countries as it looks to roll out more air taxi services worldwide. On the other hand, it is still the first commercial test of Archer Aviation's air taxi concept. Both are notable.
In early 2025, Archer Aviation signed a deal with an Ethiopian airline to launch an air taxi service in that country. Shortly afterward, it signed an agreement with a company in Indonesia for an air taxi service there. Once the Abu Dhabi air taxi service is set up, Archer Aviation can move on to the next country.
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But it isn't just foreign countries that are lined up for air taxi services. Archer is also working to get services set up in California and New York. In fact, it was even selected as the air taxi provider for the 2028 Summer Olympics to be held in California. Getting these two services off the ground will obviously require FAA approval, but once that is granted, Archer Aviation is set to move quickly.
Which brings the story back to Abu Dhabi. The template that Archer Aviation creates in that market will be used to speed up deployment in Ethiopia, Indonesia, and in the various U.S. markets where air taxi services are planned. So Archer Aviation has big plans, and soon it will have experience in bringing those plans to fruition.
The next three years will be active years
All in, Archer Aviation is likely to go from a good idea to an actual business over the next three years. It probably won't be a smooth process since what the company is doing has never been done before. However, once the first air taxi service is up and running, the second, third, fourth, and fifth air taxi services should fall into place fairly quickly.
If you are watching Archer Aviation, the rubber is going to hit the road in the next three years. More aggressive investors might want to jump aboard today, before this company hits liftoff.
