Lilium Collapses Again As Report Highlights Electric Aviation Benefits

German electric aircraft manufacturer Lilium has filed for bankruptcy for the second time in four months, casting fresh doubt over the commercial viability of electric aviation just as a new industry report highlights the potential for battery-powered aircraft to cut short-haul flight emissions by up to 70%.

Lilium, once a frontrunner in the electric vertical take-off and landing (eVTOL) sector, was forced into insolvency after a promised €200 million rescue deal failed to materialise. The company, which had secured around €1.5 billion in investments over the past decade, had already faced financial turmoil in late 2024, leading to job losses and a halt in operations.

Despite this setback for the sector, a study by CE Delft for Elysian Aircraft suggests that electric aviation could still play a key role in reducing the industry's environmental footprint. 

The report assessed the E9X, an electric aircraft under development by Elysian, and found that for flights up to 1,000 kilometres, battery-electric aircraft significantly outperform conventional jet fuel-based alternatives. 

The climate benefits come primarily from higher energy efficiency and the elimination of non-CO₂ emissions, which contribute heavily to aviation’s overall climate impact.

The study found that when measuring system energy efficiency, battery-electric aircraft perform on par with high-speed trains and electric cars in terms of energy input versus output. 

However, while these findings bolster the case for electric aviation, Lilium’s failure highlights the technical and financial hurdles companies face in turning these environmental gains into a viable business.

Founded in 2015, Lilium aimed to revolutionise urban air mobility with its eVTOL Lilium Jet, attracting major investors and government support. But technical challenges, high development costs, and regulatory barriers proved too difficult to overcome. 

After failing to secure a €50 million government loan in October 2024, the company filed for insolvency and made 1,000 redundancies. 

A last-minute investment deal in December temporarily revived operations, but by February, funding had collapsed, forcing Lilium to shut down for good.

The wider eVTOL sector has drawn around $13 billion in investment since 2019, yet many companies remain far from profitability. Industry predictions indicate the first certified eVTOL passenger flights may not take off until 2026 or 2027, with the US expected to lead initial operations. 

This long road to commercialisation raises questions about how many of today’s electric aviation pioneers will survive the transition from prototype to full-scale production.

For electric aviation to become a genuine solution for decarbonising the industry, developers, investors, and regulators must work together to navigate financial risks, accelerate certification processes, and prioritise investment in infrastructure. 

Make sure you are part of that discussion at WATS 2025.