“Toyota has done the engineering homework that you and I never could.

“It’s torn this thing apart, studied the patents, and run the numbers in a way no Wall Street analyst ever will.

“And then it did something that should stop you cold…

“The company wrote a check for $894 million — and went to work building a factory beside a child prodigy some are comparing to Elon Musk.”

That’s the beginning of an ad from Jason Simpkins for The Crow’s Nest ($99/yr, six month refund period)… and it’s a pretty breathless pitch about the next big revolution in transportation, but it also seems like maybe a nice break from talking about nothing but space and AI stocks, so let’s dig in… more from the ad…

“… what the horse and carriage was to the 18th century…

“What trains were to the 19th…

“And what automobiles were to the 20th…

“That’s what his amazing new invention will be to the 21st century

“Because the commute envisioned by The Jetsons has finally arrived.

“With an airship that can hover in an instant or dart off to the horizon like a dragonfly….

“What I’m going to share with you today is a whole new way to travel — one that makes traffic jams, gas-guzzlers, and even self-driving cars a thing of the past.

“A two-hour commute? GONE!

“Replaced by a 20-minute jaunt in a total industry takeover called ‘Uber Air.'”

So we’ve got a new technology, some name-dropping about Elon Musk and President Trump (both of which are almost required in any stock teaser ad these days), and a “child prodigy” leader. What’s going on?

Here’s a little more of the tease:

“Major launches are already planned in 10 states, including Florida, New Jersey, New York, Texas, and more…

“Along with an exclusive agreement to operate in Dubai….

“It’s an electrically powered plane that takes off and lands like a helicopter that even total novices can safely operate to…

– Provide fast transport for soldiers and sailors to and from the battlefield
– Evacuate the wounded
– Deliver much-needed supplies and ammunition
– And deploy special forces with a new kind of aircraft that’s 100 times quieter than conventional aircraft during takeoff and landing — and nearly silent in flight

“With or without a pilot on board.

“Like a helicopter but at a fraction of what it costs to buy, operate and maintain.”

What else do we learn about this “Uber Air” story?

“… the world’s largest, most successful ride-sharing service has already poured $125 million into this tiny firm, agreeing to become partners.

“So it can leverage this new wave in aviation to create an entirely new way to get its customers from point A to point B.

“As part of a massive effort called Uber Elevate…

“A firm that some are predicting will be the world’s largest airline by departures just four years from now.

“It sounds crazy, I know…

“But 20 years ago, no one imagined they would one day dial up an Uber or a Lyft.

“Now millions of people get around in rideshares every day.”

And the manufacturing prowess they’re building comes from a different partner:

“Toyota has dumped $894 million into this same company and is working in tandem with it at its new manufacturing plant.

“At a factory that one day will likely encompass 2 million square feet of manufacturing space, cranking out thousands of them.

“On par with Tesla’s biggest plants.

“All built and operated by a company still trading for as little as $10 a share.”

We all remember the many “flying car” pitches from 2021, I imagine, so why does this one stand out? Here’s how Simpkins puts it:

“This isn’t the only company building these amazing new flying machines.

“Like the early days of the automobile industry, there are dozens of players — at various stages — hoping to cash in on this.

“But There’s Only One Best-in-Class Company…

“The Firm I’m Going to Share With You Today…

“… critical patents for:

– A unified air traffic control system and method for seamless takeoffs:
– An electric tiltrotor patent that enables the craft to hover on command.
– A system and method for noise mitigation for flights as quiet as a conversation.
– A new battery thermal management design to keep the operating systems cool.
– And an electric power system architecture that allows for redundancy if motors fail — ensuring safe flights.

“They’ve also designed a new universal charging system that one day may become the industry standard, just like Tesla.

“It can charge every plane in the fleet in as little as five minutes between flights and is freely available to the entire industry.”

And they have a second major partner/customer:

“Delta — one of the biggest airlines in the world.

“Starting with a $60 million up-front investment, with another $200 million earmarked for future funding.

“Aside from the $894 million investment by Toyota, that’s the other piece of the puzzle that’s so exciting.

“Being able to deliver this revolutionary new experience to Delta’s 190 million customers by integrating it into the booking flow with the simplicity of the Uber Air app.”

And Simpkins runs through some hypothetical math to argue for this investment:

“Because the more I crunch these numbers, the more certain I am that this $10 stock is ready for liftoff.

“To start, let’s take a look at the revenue that could be generated by the number of proven flights in the test I told you about earlier…

“The one at Dallas-Fort Worth.

“Where this small firm proved they could handle 120 fights per hour.

“Which over the course of 12 hours would be 1,440 flights per day.

“And let’s assume each flight carried three passengers each… which equates to 4,320 passenger trips a day.

“If each paid $75 per trip — which is based on the company’s planned price of $3 per mile, that would generate $324,000 in revenue each day.

“Or roughly $118 million each year….

“That’s just one application at one airport…. Delta has over 290 locations.

“Just two dozen sites would add about $2.8 billion to their top line, growing their sales by 5,183%….

“… the company has projected that each new Uber Air they produce will generate about $1 million per year in pure profit over time.

“… according to documents it’s filed with the SEC, the company plans to have as many as 850 Uber Airs in the skies overhead at some point in the near future.

“That would generate $850 million in company profit, equal to roughly $0.87 per share.

“At a 30 P/E — which is entirely reasonable for a growth company like this, if not low — that would equate to a share price of around $26…

“Giving early investors the chance to more than DOUBLE their money over the next two years as they begin to ramp up.”

And he spitballs that “$1 million in profit per aircraft” number…

“… by 2030 and beyond, the company projects a fleet of Uber Airs many times larger… to the tune of 14,000 vehicles generating $20 billion in sales with services in 20 cities.

“Doing the Math, That Equates to $14 Billion in Profits

“Or roughly, an incredible $14.30 per share.”

So who’s our secret “Uber Air” stock? This is Joby Aviation (JOBY), which did indeed buy the Uber Elevate division from Uber a few years ago… and which, yes, is aiming to launch air taxi services using its (piloted) eVTOL aircraft, starting with the launch in Dubai but also testing in New York and Texas under some special federal testing dispensation as they get to the final steps of FAA certification (they’re expected to have full FAA certification within the next year or so, it’s a long and multi-step process they’ve been working through for a long time).

JOBY and their VTOL competitors were popular “flying car” stocks during the 2021 market mania, mostly because a few of them went public through SPAC mergers at about the same time (Archer Aviation (ACHR), Vertical Aerospace (EVTL), Eve Holdings (EVEX)). Those were all wild “overpromise” stories in 2021, as was the case with most of the “SPAC IPO” stocks at the time (that’s still a “feature” of SPACs today), and they collapsed pretty thoroughly during the 2022-2024 period as a result… but it has become clear over the past year that JOBY is the market favorite, and has the earliest jump on generating revenue.

That’s a good sign, as is the partnership with Toyota to expand their manufacturing. And it’s also encouraging that they’ve been testing hydrogen fuel cell versions of their aircraft, which can potentially bring a dramatic increase in distances traveled (from 100 miles or so to 500 miles), even though I have no idea whether that will eventually be commercially viable (or safe enough for consumer use).

And how does that projection from Simpkins work out? If we say that this rapidly scaling air taxi services generates $14.30 per share in profit in, say, 2035, and that they are able to get there without dilution, both of which are huge “if’s” for a company that is just starting to field test the service and may need to raise additional capital if they’re going to expand manufacturing much more quickly… and we assume that they’ll trade at 20X earnings at that time, that would be $286. If the stock is at $10 now, then that’s a hypothetical runway to potential 40-50% annual gains for the next decade. Half of that would be excellent, so there’s some room for dilution, and for delays in scaling up from 1,000 aircraft in a few years to that 14,000 number Simpkins cites.

What’s the risk level? I’d have to say, “pretty high.” Who knows, maybe these first Manhattan test flights to JFK will result in a collision or two, or their costs will be 5X what they project them to be, and they’ll have to restrict usage to just the uber-wealthy who are already using helicopters. Lots of things could go wrong, even if we accept that this particular company is the “first mover” and perhaps has the inside lane to being the “top dog” in this industry, thanks to the superiority of their designs and performance and/or the Uber and Toyota (and Delta) partnerships.

Simpkins’ former colleague, Alex Koyfman, pitched this as the “Tesla of the Air” back in 2021, and I wasn’t ready to buy into the idea then, it was too early (FAA certification started in 2018)… but now? They passed a key FAA milestone last month, which was impressive, so they really are likely to be certified within the next year or so, allowing them to really start offering their Air Taxi services at commercial scale. It will probably take a few years to become meaningful, even if everything works really well, they’re still in certification and I’m sure there will be local airport and consumer concerns and protests as well as celebratory acceptance (after all, it was only ~18 months ago that a skilled military pilot in a Blackhawk helicopter collided with a jet on approach to National Airport — congestion near airports is a big issue)… and whether they achieve real commercial acceptance beyond the “replacing helicopters for the uber wealthy” is, of course, an open question.

This is not going to start out as “Uber Air,” if all goes well it’s going to start as “Uber Black Air”, at $150-300/seat for basic “to the airport” shuttle service out of heliports in Manhattan or Downtown Dallas, which is roughly the same price as the existing helicopter shuttle services (like Blade Air from Manhattan to JFK, which is $195 on scheduled service, as long as your bag isn’t too heavy). Plenty of folks in Texas and New York will pay those fares with a smile to avoid an hour in traffic jams, particularly since Uber Black or a Limo are also often in the $100-300 range, and a private helicopter charter would be more like $2,000+… but extending the market beyond that will take a lot of capital and a lot of time.

Still, it’s getting to be more of a “real” story than it was five years ago… maybe worth following and thinking about a little speculative buy at some point, I’ll put JOBY on the watchlist and let you know if I ever decide to take a nibble.

Sound like your kind of story? Too speculative, or prefer the other VTOL stocks? Let us know with a comment below… thanks for reading!