Air taxi makers Joby, Archer, and Vertical Aerospace are locked in courtroom battles over intellectual property and trade secrets, threatening to delay Federal Aviation Administration certification and erode investor confidence in a sector Morgan Stanley values at $1.5 trillion by 2040.
Three of the most advanced electric air taxi makers in the US are fighting each other in court over intellectual property and trade secrets, a legal war that risks delaying Federal Aviation Administration certification and souring investor appetite for a sector Morgan Stanley values at $1.5 trillion by 2040.
"Investors are going to look at things going awry, the resources that are being spent on those lawsuits, and they're going to turn away from the sector," Kyle Clark, chief executive officer of Beta Technologies, told CNBC. "If Joby, Archer, Vertical and Eve go down, we're going to go down with them."
The legal battles unfolded in rapid succession. Joby Aviation sued Archer in November, accusing the rival of corporate espionage after a former Joby employee, George Kivork, joined Archer and allegedly took confidential technical information and stakeholder communications. Archer clapped back weeks later, alleging that Joby concealed ties to China and misclassified Chinese aircraft parts as consumer goods including "hair clips" and "socks" to evade customs scrutiny. Separately, Archer hit British air taxi maker Vertical Aerospace with a patent infringement suit over its Midnight aircraft design, a claim Vertical called "without merit."
The infighting comes at a critical juncture. President Donald Trump's eVTOL Integration Pilot Program, launched by the Department of Transportation in September and expanded to 26 states in March, is designed to accelerate certification and commercial deployment. Testing is expected to start this summer. But the courtroom distractions are consuming resources and attention that could otherwise go toward meeting FAA requirements. Archer said it completed Phase 3 of the four-stage type certification process, while Joby is most of the way through Phase 4 and has begun flight testing its first conforming aircraft. Vertical is pursuing certification through the European Union Aviation Safety Agency with a target of 2028.
The cost of litigation is already visible in market performance. Archer Aviation is down 9% this year and has lost more than a third of its value over the past 12 months. Vertical Aerospace has shed about half its market capitalization after falling nearly 58% in 2025. Eve Mobility lost about 13% of its market cap last year, while Beta Technologies, which went public in November, is down more than 50% from its first close. Joby's stock has lost nearly 7% in 2026 following a 60% run-up in 2025. The sector's combined market value erosion reflects investor impatience with certification timelines that have been pushed back repeatedly — Joby originally targeted 2024, Archer aimed for 2025, and both dates have passed without commercial passenger flights.
"If the industry continues to sue each other, then it's going to drag out certification timelines and increase costs," said Mike Hirschberg, principal at aviation advisory firm H2 Advisors.
The Trump administration's pilot program provides a potential lifeline. The initiative, which Transportation Secretary Sean Duffy described as a way to showcase "the INNOVATION we are seeing in America's skies," gives air taxi makers a structured path to demonstrate passenger flights under FAA oversight. Joby was approved for five of the eight pilot program slots and expects to start flying passengers in demonstrations as soon as this year. Beta Technologies was selected for seven slots, the most of any manufacturer. Archer is scaling for the 2028 Los Angeles Olympics, recently paying $126 million for Hawthorne Municipal Airport near Los Angeles International Airport to build an operational hub.
The stakes extend beyond any single company. Joby has raised $894 million from Toyota and secured an additional $500 million investment in 2024. Vertical secured a funding package worth up to $850 million in April after a near-collapse in 2024 that forced out its founder. Archer acquired around 300 battery, flight control and propeller patents from bankrupt German air taxi maker Lilium last year. The capital intensity of the business — developing aircraft, building manufacturing capacity, and securing certification — means few players can survive a prolonged legal war.
The last time the US aviation industry faced a similar wave of litigation was during the certification battles of the 1990s between Boeing and Airbus over government subsidies, a dispute that dragged on for years and ultimately required World Trade Organization intervention. The eVTOL sector does not have that luxury. With Chinese competitors advancing rapidly and European regulators moving faster on certification through EASA, US air taxi makers risk losing first-mover advantage if courtroom distractions delay commercial launch beyond 2028.
This article is for informational purposes only and does not constitute investment advice.
