Electric aircraft manufacturer, Lilium has announced that its main German subsidiaries will enter self-administration proceedings due to financial distress.
This follows the German parliament Budget Committee’s recent decision not to approve a loan guarantee for Lilium, which was essential to securing additional private investment.
The company also failed to reach a loan agreement with the Bavarian government.
The Budget Committee’s decision to withhold approval for a KfW loan guarantee left Lilium unable to finalise a private fundraising round that depended on German government support.
With competitors in the US, France, China, Brazil, and the UK receiving governmental financial support, Lilium saw German backing as essential for investor confidence and to attract further funding.
Lilium CEO Klaus Roewe said:Our plan was to obtain shareholder investment in a new funding round anchored by a German government backed loan of €100 million. We had already conditionally secured additional private capital to complement the KfW loan. However, the Budget Committee was unable to agree on the loan and Bavaria couldn’t do it alone.
In Germany, self-administration allows the company to retain management control, operate under court supervision, and potentially attract new investments or facilitate asset sales. This procedure is seen as an opportunity for in-court restructuring, preserving business continuity where possible.
Despite this major financial setback, Lilium anticipates a first flight of the Lilium Jet in early 2025 and aims to begin deliveries in 2026, supported by an order pipeline of over 780 aircraft for operators worldwide.
CEO Klaus Roewe said:We deeply regret the insolvency and its consequences for all stakeholders at such a crucial stage of our company’s development. However, while there is no guarantee for success in insolvency proceedings, we hope that the Lilium Jet will get a chance for a fresh start after the self-administration process is completed.
We strongly believe that electric flying is our best hope for the decarbonisation of aviation.
