Fresh off its defense-sector pivot, Joby Aviation (JOBY) is making another big move, this time targeting the high-end passenger market.
On Monday, Joby announced it will acquire Blade Air Mobility's (BLDE) urban air mobility passenger business in the U.S. and Southern Europe. While Joby develops electric vertical takeoff and landing (eVTOL) aircraft, Blade currently operates a helicopter-based air taxi service.
Joby said the deal will allow it to gradually transition Blade’s “large, loyal base of passengers from conventional helicopters to next-generation Joby aircraft,” which the company expects will reduce infrastructure spending and lower customer acquisition costs.
Under the agreement, Joby will pay up to $125 million in cash or stock, with $35 million of that contingent on meeting performance milestones and retaining key employees.
Blade CEO Rob Wiesenthal will continue leading the business as a wholly owned subsidiary of Joby. The transaction is set to close in the coming weeks.
Luxury transport for the 1%
Blade flew more than 50,000 passengers in 2024 from 12 urban terminals in the U.S., with New York City as its flagship market. The company operates dedicated lounges and terminals at JFK, Newark, and multiple locations across Manhattan, including Wall Street.
As Andrew Ross Sorkin wrote in the DealBook newsletter, Blade has “become synonymous with services to beat traffic to get to ritzy locations” for its wealthy clientele. A one-way helicopter flight from Manhattan to the Hamptons can cost nearly $1,200 per seat.
Joby plans to launch its VTOL service in Dubai next year, but U.S. regulators may take years to approve similar operations stateside. JoeBen Bevirt, founder and CEO of Joby Aviation, said acquiring Blade’s infrastructure and customer base gives the company a major head start:
“We will be in the best possible position to launch our quiet, electric aircraft as soon as certification is secured," he said.
"This is a strategically important acquisition that will support the successful launch of Joby’s commercial operations in Dubai, our subsequent global rollout and our continued leadership in the sector.”
Blade’s medical unit spins out
The deal doesn’t include Blade’s medical transport division, which will remain public under a new name, Strata Critical Medical. That business generated about two-thirds of Blade’s revenue in Q1.
Joby will, however, become Strata’s preferred VTOL partner for organ transport once its aircraft fleet is launched.
Blade has struggled financially since going public in a 2021 SPAC merger, never posting an annual profit and losing about half its stock value since listing. But Monday’s news lifted Blade shares 17.2%, while Joby surged 18.8% on the announcement.
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