Cash-Strapped Electric Jet Manufacturer Lilium Picks KPMG to Handle Sale

Lilium on Tuesday enlisted accounting consultancy KPMG to help find a buyer for the business after failing to secure a loan guarantee from the Bavarian government, which forced it to file for insolvency.

The manufacturer said more than 1,000 employees are continuing to work toward the first crewed flight of its flagship model, for which it has received 780 firm orders, reservations, options, and memoranda of understanding (MOUs) from operators worldwide.

The restructuring of the company—which could result in liquidation via the sale of individual assets or the entire business—will be led by Lilium’s current management and overseen by two German court-appointed lawyers. The firm said initial investor briefings will begin soon.

The Nasdaq, meanwhile, notified Lilium that its U.S. shares will be delisted by the opening bell on Wednesday. Ordinary shares may continue to be traded “over the counter,” which the firm said could depress share price and trading volume.

“With the support of our appointed custodian and the restructuring experts, we at Lilium remain fully focused on re-emerging following restructuring, with fresh investment to support the all-electric Lilium Jet’s path to certification and entry into service,” said Klaus Roewe, CEO of Lilium.

Lilium’s flagship Lilium Jet is designed for a pilot to fly as many as seven passengers on regional, city-to-city trips as far as 125 sm (109 nm). At the core of the model are 30 electric ducted fans, which provide lift during takeoff and landing as well as thrust during forward flight. The configuration sacrifices some efficiency during hover flight for improved cruise performance and a lower noise profile.

Lilium had been hoping to secure funding from the German state as eVTOL competitors in other countries garner support from their respective governments. When its request for a loan guarantee was denied, though, investors—who had been gearing up for another funding round—got cold feet. The hope now is that KPMG can help find a buyer to take on some or all of the business, potentially reviving the Lilium Jet.

Lilium said it has informed employees about payment and met with suppliers to revise their expectations amid the financial crisis.

According to the manufacturer, the first two Lilium Jet prototypes are in final assembly, and one is almost ready for ground testing, The fuselage and wings for a third aircraft are also being assembled, and one airframe has undergone structural testing in a static test rig.

Earlier this year, the firm reiterated its expectation that the jet’s inaugural crewed flight would come in early 2025. But given the current situation, it would not be surprising if the company misses that deadline—or the jet never flies at all. Any delay to crewed flight testing could have a ripple effect on the Lilium Jet’s planned 2026 entry into service in regions such as the U.S., Europe, Middle East, and Asia.

In the U.S., Lilium is working with newly formed operator UrbanLink Air Mobility to launch service in South Florida, California, and Puerto Rico. The company last year became the first to earn certification bases for an eVTOL aircraft design from both the FAA and European Union Aviation Safety Agency (EASA).

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