Deal Watch: Surf Air Mobility acquires Ampaire
For the shortest month of the year, February certainly has been busy with aviation deals. The most recent among this flurry of deals has been Surf Air Mobility’s (SAM’s) acquisition of Ampaire, one of the companies pioneering electric-hybrid aircraft technology.
This comes a year after Surf Air Mobility acquired charter broker BlackBird and more recently, follows Joby Aviation merger to go public via a SPAC at $6.6bn and Archer’s Special Purpose Acquisition Company (SPAC) merger, which will value the eVTOL start-up at $3.8bn.
Ampaire CEO Kevin Noertker told Revolution.Aero that the electric revolution will happen faster through the partnership of both companies. Noertker said: “We’re combining all of the critical components to achieve our shared vision of a future where personalised air travel is affordable for everyone and sustainable for generations to come.”
DiamondStream’s MD Brian Flynn told Revolution.Aero: “Ampaire’s technology is foundational for low-cost hybrid electric aircraft.”
Flynn believes the companies are strategically aligned. Cost per available seat mile (CASM) will serve as a bedrock for the Surf Air Mobility business model, he said.
Further, being under the Surf Air Mobility umbrella greatly mitigates two risks. “The risk was that as independent companies, they would not work as efficiently to achieve a common goal and the risk/time required to raise additional necessary capital. Their shared vision and mutual respect should enable them to ‘go faster’ than they could as independently owned and operated companies.”
Ampaire’s EEL aircraft has successfully logged over 100 flight hours in California and Hawaii – between Kahului to Hana on Maui.
By attaching a battery to the belly of the aircraft, Ampaire retrofitted a Cessna 337 Skymaster and rechristened it the Electric EEL (337 arranged back-to-front). The EEL is capable of flying 200 miles with three passengers or 450lbs (200kg) of cargo.
This is the first aircraft of this type to receive FAA experimental market survey approval, allowing the company to carry passengers other than flight crew. The aircraft displayed 100% dispatch reliability and long endurance flights of more than 340 miles (550 kms) and durations up to three hours.
Ampaire’s use of the 1963 push-pull configuration aircraft to refresh it for the modern age highlights an important point. The future of aviation has a heavy influence of the past. Noertker said there are thousands of aircraft eligible for a similar powertrain upgrade.
Aircraft certified under the FAA’s Part 23 rules will offer the best payload and performance combination for available hybrid-electric technology.
Not only does this deal underscore the movement of traditional business aviation companies – such as Directional Aviation and Wheels Up – to the urban and advanced air mobility (UAM/AAM) sectors, but also a shift towards hybrid electric aviation.
Research from UBS suggests this $178bn market could take-off – with hybrid cargo and passenger aircraft carrying up to nine passengers over short distances – as soon as 2022.
“And regional platforms capable of flying up to one hour from 2028. UBS Global Aerospace, Transport and Energy teams explore the implications of a greener aviation boom and a potential new US$178bn market up for grabs,” said the report.
Surf Air Mobility kicked off its business offering fliers unlimited regional flights for an annual membership of $19,200 a year, meaning it is well-placed to accelerate the hybrid electric movement.
The future is all-electric
Surf Air Mobility intends to make hybrid electric powertrain upgrades available to fleet owners on and off its consumer platform, as well as license its technology to OEMs for new aircraft types. But the eventual goal for the company is to fly fully electric.
Surf Air Mobility president Fred Reid said the company would focus on shorter, regional routes in the near term. “By improving the cost structure, we’re able to create a new kind of point-to-point network that opens up previously untenable markets with more direct connections. With half of all US flights 500 miles or less, hybrid electric technology will have an immediate and broad-reaching impact,” he said.
Noertker said successfully merging the two companies would take time. “We will slowly start to integrate over the course of 2021, bringing the teams and brands closer together. Our current projections estimate that the first hybrid-electric aircraft upgrades will be certified by the end of 2023.”
Regional airlines looking to replace turboprop aircraft on routes up to 500 miles are ideal customers. Ampaire plans to do this by renewing more aircraft not traditionally seen in the business aviation context. It is working on converting traditional Twin Otters into a low-emission variant called the Eco Otter SX design. The company will use $6.4m funding from NASA to convert the 19-seater from its current turboprop engines.
Surf Air Mobility hopes to fly passengers on hybrid planes as early as 2024. But before that, the industry can expect more deals in the coming months, with German manufacturer Lilium in talks to go public and new SPAC New Vista Acquisition Corp looking for aviation companies to merge with.
Is it too soon to write-off jet aviation?
Kevin Noertker, Ampaire, Dean Donovan, DiamondStream Partners, Neil Cloughley, Faradair, Eric Bartsch, VerdeGo Aero, Andrew Patton, ZeroAvia