Archer Aviation CEO Adam Goldstein thinks defense, not air taxis, could be its “front and center” business

A flying car, an electric helicopter, an air taxi, an eVTOL (electric vertical takeoff and landing) aircraft: whatever you want to call the vehicle, it’s closer than ever to being in a sky near you.

Air taxis are having quite a year, from big cash raises to executive orders. The promise: to one day soon shuttle about four passengers short distances (like to the airport) by air, potentially shaving hours off of travel time, for a fraction of the cost of what a helicopter trip typically costs. Shares of the companies that promise this future have taken off in recent months.

Archer Aviation is a major player in the industry, with plans to launch commercial air taxi service in the US before the LA Olympic Games in 2028, pending an FAA green light. We sat down with the company’s CEO, Adam Goldstein, to talk about where Archer’s future might be headed.

This conversation has been edited for clarity and length.

Sherwood News: You announced the completion of a test flight in Abu Dhabi earlier this month — break that down. I’d love to know how transferable the lessons that you get from flying in Abu Dhabi are when you’re thinking about flying in LA or New York or Miami.

Adam Goldstein: Any of the operational lessons are certainly very transferable. I’d actually say probably most things that we do will be super transferable over there, with some of the big differences being the weather. It’s very hot and harsh over there. No matter how much air-conditioning you have, if you open the doors and it’s a hundred and whatever degrees outside, the air all goes out. It’s all the lessons of being hot.

We don’t really have that many climates in the US, or in the West, that are consistently like that. It definitely helps us from that standpoint.

So with Abu Dhabi, it’s early, there’s regulatory lean-in, there’s capital, there are people that want it, and there’s a society that wants it. I think that’s really great, and I think that’ll help accelerate the rest of the world.

In the latest test we did, Abu Dhabi just wanted to show a flight in front of the Grand Mosque. That was their big thing. They were like, put a plane up in front of the Grand Mosque, show the picture, and it’ll be beautiful and prideful for the country. That’s what they wanted, so that’s what we did. But at the same time, what we’re getting is to fly and learn in those conditions and ultimately try to launch commercial operations there.

Sherwood: Can you help me picture stepping into a future LA vertiport? How big is it, and where in the city might it be? Is it on a rooftop like a helipad, or is it ground-level? Is it more like a mini airport or a lounge? It’s hard to even imagine.

Goldstein: There are multiple variations of this. There was a vision that Uber had put out that kind of showed the Grand Central of these things. Sitting over the freeway so you’re not taking up new real estate. It’s going to take a while before these things come out there.

The opposite side will be the bus stop versions. All I really need is a 50-foot landing pad, a 50-foot safety area around that, and a fence. That’s really all I need. In some locations, you won’t even need a fence, like in Texas.

It’s going to be somewhere between those two. If you’ve ever been to a private FBO [fixed-base operator] or a regional airport, they’re just small, little check-in things and there’s not a lot of stuff in there. I think we’d want to provide more of an elevated experience than that. But the concept is not to spend your time in the takeoff and landing location — it’s to go, take off, fly wherever you want.

For the Olympics, there will be some big, amazing things that get built. I’m imagining SoFi stadium’s vertiport is much nicer, bigger, and a lot more people can land there than some of the more bus stop type of things and outposts that will be out there. It’ll be a mix.

[Editor’s note: Archer is the official air taxi partner for the 2028 LA Games.]

Sherwood: And from a logistics standpoint, the user experience? When and how would customers be buying a ticket on a flight, and are the flights on-demand or are those a fixed schedule?

Goldstein: The 20-year view is highways in the sky. It’s super liquid: you don’t need a seat, you just show up. It’s like a sky ride. You hop on and you go from Orange County to, you know, Santa Monica, and it’s just no big deal.

I think in the beginning it won’t be nearly that liquid, obviously. You’ll need to book something, book a time. It’s not that it’ll be scheduled necessarily in the way United planes are scheduled, but more every 10 or 15 minutes you can take off and land, whatever it is. And you’ll need to know if there’s going to be room or not, because there’s going to be way more demand than supply we can give for a while.

You’re thinking about it from the consumer or user perspective, but if you think about it from the business perspective, you have a vehicle that’s structurally better than helicopters, meaning it’s safer and lower-cost and quieter. If you start to think about cities — what’s the 1,000th-biggest city in the world by GDP or whatever metric? I don’t know the answer, but I bet it’s like a Flagstaff, Arizona, or some city that you would know. And the question is: could you put 10 or 20 of these aircraft in that city?

Hospitals use these vehicles. The pitch is so easy. You already use this thing; do you want something that’ll literally cost you less but it’s safer? That’s a pretty easy pitch. There’s VIP stuff, there are tours, there are different types of emergency services or for moving certain political people around. Can we put 20 aircraft in that city? Sure, I don’t think it’s that big a deal to put 20.

So you’re like, 20 times 1,000, that’s 20,000 units. Times $5 million, that’s a big business, and we haven’t even talked about the defense stuff yet.

Sherwood: Speaking of defense, obviously air taxis are the primary pitch for Archer right now, but you’re also involved in defense contracts, aircraft sales, and aviation software. How do you prioritize those revenue streams internally?

Goldstein: The first defense aircraft we’re building is going to be hybrid and it’s going to be an eVTOL product. We’re going after the industry that they call autonomous and attritable.

I actually think the defense side could end up being larger than the civil side, at least for the first 10 years. So I don’t think of that as a side thing. I think that could be, actually, the thing that’s front and center.

What’s happening right now in the defense world is — it started in Ukraine, and you saw the same thing in Israel-Gaza — unmanned, low-cost systems are defeating expensive, centralized, in some cases manned systems. They call it asymmetric warfare.

The thing that became scary about that is: the advantage the West always had was that we could build the biggest gun, the biggest laser, the biggest weapon system. Now that’s not really the thing that wins anymore. It’s the volume of these low-cost things that you can put out there. And because the US does not have such broad, deep manufacturing as it used to have and some of our adversaries have that, it puts us in a little bit of an upside-down scenario.

The way that, let’s say, the senior people that think through all this stuff look at our industry is that it’s a new industry that has a big civil business, which means lots of manufacturing capability, a huge market to go scale into, big new supply chains are getting built, and the products can be turned into variants to be used for the defense side.

In World War II, we made a lot of airplanes here, but we also had companies like GM and Ford making airplanes. I don’t really see that happening in today’s world. You need new airplane companies doing that. So companies with big civil businesses — especially new businesses that can turn over and switch that to big defense businesses at certain key times — I think are going to be really important. And they look at us as one of those.

We could build a variant of the product that we already build, in the same factories that we already have, that can scale up in the same way we’re scaling up the civil side. If there becomes a very big need for this, we’re there to answer that. And I think it’s pretty obvious that the West is going to need these solutions, these types of capabilities. It’s sooner rather than later, just based on all the conflicts that are pointing toward that.

Sherwood: So defense could be larger for the first 10 years. Is it too far away to estimate when the civil air taxi business would take over?

Goldstein: The civil side is substantially larger in its totality, right? In the near term, the defense side could end up being larger because of the need.

Everybody always asks, well, which one will you do? Civil or defense? One answer is, well, is one a good business and one not a good business? And then two is, what’s necessary? I view myself as a patriot, and if we needed stuff to defend the homeland, we certainly would be there to answer the call.

Sherwood: That feels like a big statement, that you think defense could be larger than air taxis.

Goldstein: Think about it this way: is an Abrams tank as useful today as it was pre-Ukraine, call it five years ago? I would guess the answer is no. It’s less useful, as they’re very vulnerable to attack. It’s the same thing when you start looking at how many drones it takes to overwhelm one of these big, expensive systems — the answer is less than you might imagine.

If there’s going to be this big defense shift into attritable assets, there aren’t a lot of groups out of there that do what we do. We sit in a very unique spot to do that. Anduril is known for building products before they’re awarded contracts. We’re going to show up to the competition with product. And these contracts are really very, very large, so it puts us in a very unique spot.

I think the trillion-dollar defense budget in the US and the multi-trillions all over the world will shift pretty quick. And if you have assets and products to sell, I do think it will become a big deal, especially if the conflicts heat up.

Sherwood: Public trust is obviously going to be a huge part of the air taxi business. The defense sector can clash with public opinion. What are your thoughts on that? Are you worried about building a consumer-focused business while also building this defense side?

Goldstein: Every major aircraft OEM [original equipment manufacturer] does that. Most of the big planes are Boeing planes. Airbus does the same thing, as do all the suppliers. So I don’t think so.

I feel like the American flag was almost viewed as this symbol of Republicans, and it’s become much more of a symbol of America again, which is great.

We’re in California, and there are a lot of people here that are sensitive. It’s kind of balanced, though, so I think there’s more patriotism. But who knows? Maybe I’m wrong, but I would say no to that, because everybody does it. It’s pretty natural. But I think it’s a good question.

Sherwood: Jumping to the consumer side, you’ve said that Archer wants to be a mass-market air taxi service, priced in the range of an Uber Black at launch. Midnight is reportedly a $5 million aircraft, right? Could you walk me through the model there? How does that work?

Goldstein: First, we will sell aircraft, especially in the beginning, and I think we’ll make more money from aircraft sales than operations. But I can help walk you through why that math still makes sense.

If you’re in New York, an Uber Black costs probably $120 from Manhattan out to JFK. If you assume, of the four seats, three are full, that’s $360 per leg. It takes you six minutes to actually fly that leg. How many legs can you do in an hour? How many can you do per day?

The vehicles are designed to do about 40 trips per day of a nominal mission like that. Knock that down to 25 trips, times three passengers, times $120 per trip. You start to do the math, and these vehicles are doing $3 million to $4 million per year per vehicle in revenue.

Then you look at the cost side of the equation. The pilot’s fixed. The energy is basically free; it doesn’t cost much at all to fly. The two big things that end up costing a lot of money are the landing fees and the maintenance. The maintenance should, especially in the beginning, be relatively minimal. Landing fees are the most unknown one, because we have to convince the JFKs of the world that, hey, there’s not going to be six landings of helicopters anymore — there’s going to be 5,000 now, across the industry.

So you start to look at the cost profile there and it starts to look pretty good in the payback period on these vehicles. The vehicles last for 15 to 20 years. If you think about that, it’s not really an expensive product anymore. The unit cost itself as a percentage of total cost, by our back-of-the-envelope estimates, is like 10%. Everything else is actually way more expensive — the pilots, the landing fees, the maintenance.

Sherwood: There are absolutely astronomical projections for where this industry could go. Morgan Stanley projects there could be trillions of dollars in long-term potential. I’m curious: do you find those outlooks to be distracting to the day-to-day? Do you worry they might distort expectations or set expectations too high?

Goldstein: I think there’s a group of people out there that want the future world to happen, and there’s a big retail crowd that wants that to happen, and that drives excitement around this. It’s not a money thing; it’s a change thing.

If you could fly instead of drive — if you’re in New York and it was $60, $80, $100 to go to the Hamptons, to go to the beach, Jersey, Connecticut, or wherever you wanted — I just have to imagine there’s nobody that thinks their life wouldn’t be better if they had access to that. Anything that’s encouragement of the industry I would say is great because it just brings more people.

So I look at all that stuff as positives, and I brush off a lot of the negativity that’s out there. When I talk to people, the only two groups of people I’ve ever met that don’t want this to happen are one, helicopter manufacturers (those guys don’t like us), and two, people from competitive companies or people invested in competitive companies.

In the end, I think this product is better for everybody. The product exists — they’re helicopters. It’s a more sustainable product, it’s a lower-cost product so there’s a better equity story, and it’s a safer product. Most humans would say their most valuable asset is their time. If I can give you your time back, if I can build you a time machine, I would think that would be very valuable to most people. So I like the people that encourage it. Yes, there are a lot of dreamers out there, but we’re dreamers, too.