(Reuters) – Archer Aviation said on Wednesday the U.S. Federal Aviation Administration (FAA) has granted the company a certificate to begin commercial operations, making it the second electric air taxi manufacturer to reach this major milestone.
Shares of the Santa Clara, California-based company rose 3% in morning trading after receiving the nod, known as Part 135 certification.
The flagship electric vertical take-off and landing aircraft (eVTOL), ‘Midnight’, has yet to receive type certification from the US aviation regulator. That certification means that an aircraft meets FAA design and safety standards.
Archer, which is backed by companies including Stellantis, Boeing and United Airlines, said it plans to use conventional aircraft to refine its “systems and procedures.”
Peer Joby Aviation received Part 135 certification from the FAA in 2022.
Archer is one of a group of eVTOL makers who want to revolutionize urban traffic in busy cities by offering short-haul air travel.
But the industry faces regulatory and technological challenges, such as battery density, which have weighed on eVTOL manufacturer stocks.
Archer shares are down 47% this year, while Joby Aviation is down 26.7%.
However, that hasn’t stopped big companies from betting on the eVTOL makers. Earlier this year, automaker Stellantis increased its stake in Archer by about 8.3 million shares, making it the company’s largest shareholder, according to LSEG data.
(Reporting by Abhijith Ganapavaram and additional reporting by Abhinav Parmar in Bengaluru; Editing by Tasim Zahid)
