Saudia hands Germany's Lilium biggest order yet for flying taxis

By Alexander Hübner

MUNICH (Reuters) -Germany-based air taxi developer Lilium on Thursday clinched its biggest order yet in a deal for Saudi airline Saudia Group to purchase up to 100 of its all-electric flying shuttles, which are still in development.

The state-owned airline made a firm order for 50 of Lilium's electric Vertical Take-Off and Landing (eVTOL) Jets with an option for an additional 50 later, Lilium said.

The first of the shuttles, which have four-to-six seats and are designed to replace road trips or short hops by aircraft or helicopters, are expected to join Saudia's fleet in 2026.

The deal-signing took place at Lilium's headquarters outside Munich during a trip by Saudia executives to Germany.

Lilium co-founder Daniel Wiegand told Reuters that the value of the whole order, including the options was about $700 million.

Competing in a crowded market for eVTOL vehicles, the firm needs advance payments from customers to finalise the development of its flying taxi.

Currently, it has 106 definite orders, including Saudia's, plus 76 options and around 600 memorandums of understanding, Lilium CEO Klaus Roewe said at the event.

Delays in the delivery of testing equipment and other parts have forced Lilium to push back the first manned flight of its vertical take-off aircraft until the beginning of next year, it said on Wednesday.

According to Saudia, it will use the air shuttles to transport pilgrims between Mecca and Jeddah, and to transport guests to major sporting events in the capital Riyadh as well as tourist destinations.

Saudia expects the first 50 planes to be delivered by 2029, Chief Marketing Officer Khaled Tash told Reuters.

During their visit to Germany this week, the airline's executives also visited Airbus in Hamburg following a major order of narrow-bodied jets recently announced as part of Saudi Arabia's plans to boost air traffic and tourism to the country.

Saudia aims to triple its annual passenger numbers to 300 million by the end of the decade. Tourism is a main pillar of Saudi Arabia's "Vision 2030", a sprawling programme of investments to diversify the kingdom's economy away from oil.

(Additional reporting by Rachel More, Editing by Madeline Chambers and Sharon Singleton)