Lilium will not receive German federal loan guarantee

UPDATED: Lilium will continue negotiations with Bavaria for a €50m loan after its application for a federal loan guarantee worth the same amount was denied by the German government.
In a post published on X, Bavarian politician Karsten Klein stated: “I regret that, despite intensive negotiations within the coalition, no agreement could be reached on aid for Lilium . For the Free Democratic Party, after in-depth discussions, the chances of receiving federal aid outweighed the risks.”
The decision, which was item 60 on the two-day agenda, if agreed, would have seen Lilium secure a loan guarantee worth €100m – €50m from the federal government and €50m from the state of Bavaria.
The state tranche had been agreed in September subject to the federal government agreeing to match it. That was a reality Lilium CEO Klaus Roewe was confident would be seen into fruition back in the summer when he said he expected guarantees “in a matter of weeks”.
Lilium published a Form 6-K confirming the federal government’s decision yesterday. It also revealed it is continuing discussions with the State of Bavaria in an attempt to secure the €50m it had previously agreed to front before the federal government’s refusal.
Previously, the eVTOL developer had publicly voiced its difficulties in securing state loan guarantees having first applied to Bavarian government in late 2023.
On May 15 of this year, Lilium announced a step forward in its funding discussions with its home state of Bavaria and the German government. “We’re very encouraged,” Roewe told us at the time. “Bavaria and the German government have commissioned the state bank KfW to conduct due diligence on Lilium as part of the customary investment process.
“Once the diligence is completed, we expect to receive guarantees from the Federal Government and the State of Bavaria as security for a loan from the German state bank.” The due diligence process which began in May was set to last between six to eight weeks.
Earlier this week, Roewe responded to what he calls “misunderstandings“ regarding the Lilium’s loan from German development bank KfW. In a statement published on LinkedIn, Roewe sought to clarify a number of points regarding Lilium’s €100m loan, alternative fundraising efforts and ensuring Germany has an electric aircraft programme.
Now with no hope of attaining federal backing in Germany, Lilium might look elsewhere to France and possibly the US for support.
Back in May 2024, the firm announced it was in “advanced talks“ with the French government on potential subsidies and loan guarantees worth up to €400m. To date nothing further has been revealed.
Lilium declined to comment.