Flying Taxi Maker Archer Settles Boeing Lawsuit, Secures $215M in Funding

By
Vivian Medithi
Vivian Medithi
Full Bio
Vivian Medithi is a freelance writer and critic with bylines at Guardian US, LA Review of Books and No Bells, among others. He previously covered the stock market as an Analyst Editor at InvestorPlace.
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Published August 11, 2023
Midnight Archer aircraft displayed during the International Paris Air Show

EMMANUEL DUNAND / Contributor / Getty Images

Flying taxi company Archer Aviation Inc. (ACHR) settled a lawsuit and agreed instead to collaborate with the Boeing Company (BA). Archer shares skyrocketed about 37% after-hours Thursday but pared most of those gains to trade up about 1% early Friday.

Key Takeaways

  • Archer Aviation and Boeing have settled multiple lawsuits alleging patent infringement and theft of trade secrets.
  • Boeing will invest in Archer and the two companies will collaborate on autonomous technology.
  • Archer Aviation has also seen significant investment by automaker conglomerate Stellantis in the form of a $70 million strategic funding agreement.

What's The Deal With The Boeing Lawsuit?

As part of the agreement, Boeing's air taxi unit Wisk will become Archer's exclusive provider of autonomous technology. The legal battle between Archer and Boeing originated with a 2021 lawsuit by Wisk alleging theft of trade secrets and patent infringement.

At the time, Wisk was a joint venture between Boeing and Kitty Hawk Corporation, an electric aviation startup backed by Google founder Larry Page. Archer countersued Wisk in 2021 and Boeing in 2022.

FAA Nod And $215 Million More To Fuel Growth

Archer hopes to grow fast, especially after receiving the greenlight from the Federal Aviation Authority (FAA) to begin test flights for its Midnight eVTOL aircraft. The FAA approval comes after a monthlong comment period on Archer's Special Airworthiness that ended in January.

With approval secured, the company hopes to begin test flights in the coming weeks, and then deliver its first aircraft to the Department of Defense under a $142 million contract.

Archer also received a $215 million injection from its latest funding round, driven primarily by Chrysler, Jeep, and Ram-owner Stellantis (STLA). In January, Stellantis entered a $70 million strategic funding agreement with Archer, with $55 million of that total still available for use. Other notable investors include Boeing, United Airlines (UAL), and Cathie Wood's Ark Invest.

Archer shares are up more than 200% since the start of the year.

Archer shares YTD

YCharts
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  1. Archer. "Wisk Aero, Archer, and Boeing Reach Agreement To Settle Litigation and Enter into Autonomous Flight Collaboration; Boeing Invests in Archer’s Latest Funding Round."

  2. Nasdaq. "ACHR After-Hours Quotes."

  3. Tech Crunch. "Kitty Hawk, the electric aircraft moonshot backed by Larry Page, is shutting down."

  4. Reuters. "Flying taxi maker Archer settles Boeing Wisk lawsuits, shares jump."

  5. The Federal Register. "Airworthiness Criteria: Special Class Airworthiness Criteria for the Archer Aviation Inc. Model M001 Powered-Lift."

  6. Archer. "Archer Accelerates Path To Market: Secures $215M Investment From Stellantis, Boeing, United Airlines, Ark Invest And Others; FAA Issues Archer Certificate To Begin Flying Midnight; Archer On Track To Complete First Ever EVTOL Aircraft Customer Delivery."

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