Blade, which is known for its urban air mobility passenger service in the United States and Southern Europe, is selling its passenger division, in a deal that I’d consider to be pretty logical.
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Blade sells passenger division to Joby Aviation
Blade Air Mobility has entered into an agreement to sell its passenger division to Joby Aviation for up to $125 million, with a deal expected to close in the coming weeks. Many people don’t know this, but Blade’s biggest business is actually transporting human organs, and that won’t be part of this deal.
Blade’s medical division will instead rebrand as Strata Critical Medical (no relation to Citi), 😉 focusing on leveraging its asset-light platform to provide mission critical logistics and medical services to hospitals and healthcare providers.
Blade’s divestiture of its passenger business includes operations in the United States and Europe, lounges and terminals in key hubs, and the Blade brand. Operations will continue as before, with the business functioning as a standalone entity within Joby upon closing.
As part of this transaction, Strata will gain access to Joby Aviation for medical use as part of a long term eVTOL partnership between the companies. The expectation is that the quiet capabilities of Joby’s aircraft, coupled with its potential to operate at lower costs than traditional helicopters and other short range aircraft, will provide value to Strata customers, and a competitive advantage for the company.
This seems like a sensible urban air mobility acquisition
Joby’s acquisition of Blade’s passenger business seems pretty logical, especially as we get closer to eVTOLs becoming something we see on a widespread basis.
For context, Blade is known for its helicopter “taxis,” particularly in markets like New York. Some people might be surprised that the purchase price for the passenger business isn’t more, but keep in mind that Blade doesn’t actually operate helicopters, but instead, it’s more of a technology company. It’s essentially the Uber of helicopters, since the actual flights are operated by separate companies.
Joby, meanwhile, is one of the leaders in the development of eVTOLs (electric vertical takeoff and landing aircraft). The company has a huge number of orders for its eVTOLs, and even has investments from airlines like Delta.
Since Joby doesn’t just plan to manufacture these eVTOLs, but also plans to operate them, it makes sense that the company would want to acquire a platform like Blade. This will allow it to rapidly grow in markets like New York, once the company’s flagship product is fully certified and ready to go. After all, you’d expect that eVTOLs will largely be replacing helicopters.
It’s clear that eVTOLs are the future of urban air mobility, and that’s great in terms of emissions. However, I remain somewhat skeptical about just how widespread their use will be. A lot of people would have you believe that we’re all eventually going to be getting from major cities to airports in these air taxis, and I’m just not convinced about the scalability of it all.
With one pilot and four passengers, how many of these can operate in a way that’s both safe and economically viable? To be clear, I see no reason they couldn’t replace the existing helicopters that are flying, I just question if we’re going to see some exponential growth in terms of the number of people getting to airports via an air taxi of some sort.
Bottom line
Joby Aviation has acquired Blade’s air mobility passenger service. The deal is expected to close in the coming weeks, and with that, we’ll see Joby take over Blade’s terminals, lounges, brand, and more. Given Joby’s ambitions, this kind of an acquisition makes a lot of sense.
If you’re a Blade customer, don’t expect any changes for now. However, once eVTOLs do start flying passengers, this should help accelerate their introduction into Blade markets.
What do you make of Joby acquiring Blade?
“ Some people might be surprised that the purchase price for the passenger business isn’t more, but keep in mind that Blade doesn’t actually operate helicopters,”
Also, keep in mind that Blade’s air taxi operation is likely significantly unprofitable.