In 2024, the European eVTOL industry encountered severe financial difficulties, with notable German startups Volocopter and Lilium on the brink of insolvency despite having raised billions in funding.

Volocopter GmbH officially applied for insolvency proceedings in December 2024 after struggling to secure essential additional funding, underscoring the capital constraints plaguing the industry.

Lilium, while boasting technological advantages such as speed and passenger capacity, has been hampered by financial mismanagement and a failed NASDAQ listing.

Insider reports revealed that Lilium missed a critical capital investment exceeding $200 million, which significantly eroded investor confidence.

In a bid to stabilize, Lilium sought a €100 million convertible loan, but the German government denied a €50 million guarantee that would have facilitated this funding.

Additionally, Lilium signed an asset purchase agreement with Mobile Uplift Corporation GmbH, aiming to revive its operations with over €200 million in funding, although it is grappling with internal issues like unpaid staff and frozen accounts.

Meanwhile, Czech startup Zuri is working on a hybrid-electric VTOL aircraft, facing challenges in attracting investors, yet benefiting from lower operating costs in its home country.

In contrast, US eVTOL companies, such as Archer Aviation, have successfully secured substantial investments and regulatory approvals, placing European firms at a competitive disadvantage.

On a more positive note, Vertical Aerospace has emerged as a strong contender in the UK with its VX4 eVTOL and a sustainable operational model, aiming for commercial operations by 2028.

The future of Europe's eVTOL sector remains uncertain, with fears that American and Chinese companies may dominate urban air mobility due to their stronger financial backing and support.

Despite these challenges, Volocopter announced a partnership with Jet Systems Hélicoptères Services to initiate eVTOL services in France, although it too faces significant financial hurdles for market entry.