MUNICH - Lilium N.V. (NASDAQ: LILM), a pioneer in electric vertical take-off and landing (eVTOL) aircraft, is in advanced talks with the French government to expand its production capacity in France. The discussions, which revolve around potential government subsidies and loan guarantees, are expected to conclude in the coming weeks, following a recent announcement at the Choose France Summit in Versailles.
The company is exploring several sites in France, particularly in regions known for aerospace and battery production, to establish its new high-volume manufacturing facilities. This strategic move could potentially create up to 850 direct jobs and represents an investment of up to €400 million over the coming years.
Lilium, founded in 2015 and headquartered near Munich, Germany, began initial production of the Lilium Jet in 2023, with commercial service launch planned for 2026. The company aims to meet the anticipated global demand for its jets, with over 780 orders and MoU agreements already in place from operators across various continents.
The expansion into France is expected to leverage the country's rich aerospace heritage and its established network of suppliers in the field of aerospace and electrification. Lilium already collaborates with French suppliers such as Saint-Gobain, Michelin (EPA:MICP), Expliseat, and Ratier-Figeac.
With the eVTOL market projected to reach $1 trillion in global revenues by 2040, according to Morgan Stanley estimates, Lilium's production in France is set to significantly contribute to French export volumes, as the majority of the jets produced are intended for international markets.
The planned facilities in France will be geared towards serving the global demand for Lilium's jets, which are designed to offer high-speed, regional transportation with zero operating emissions.
This news is based on a press release statement from Lilium.
InvestingPro Insights
As Lilium N.V. (NASDAQ: LILM) advances its plans for expanding production capacity in France, investors and industry watchers are closely monitoring the company's financial health and market performance. According to InvestingPro, there are several key factors to consider:
Lilium's market capitalization currently stands at $568.71 million, reflecting investor valuation of the company's prospects. Despite significant interest in the eVTOL space, the company's financial metrics show some challenges. The Price / Book ratio, as of the last twelve months ending Q4 2023, is at a high of 14.24, which could suggest that the stock is overvalued relative to the company's net asset value. This is particularly notable as the company has not yet turned a profit in the past year and is not expected to do so this year, according to analyst projections.
On a more positive note, Lilium has shown strong price returns over the last six months, with a 36.64% increase. This indicates a growing investor confidence in the company's future, despite its current financial performance. Moreover, the company holds more cash than debt on its balance sheet, which provides some financial flexibility as it scales up operations and moves towards the commercial launch of the Lilium Jet.
InvestingPro Tips suggest that while Lilium is quickly burning through cash and suffers from weak gross profit margins, the company has recently experienced a strong return over the last month with a 21.29% increase, and over the last three months with a 17.14% increase. This could signal a turning point for investor sentiment, potentially driven by strategic developments such as the expansion into France.
For those considering an investment in Lilium, InvestingPro offers additional insights and metrics; there are currently 13 more InvestingPro Tips available for LILM. To access these insights and take advantage of the full range of data, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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