Delta invests $60 million in Joby, seeking air-taxi flights to NYC airports

Delta Air Lines Inc. is investing $60 million in urban air taxi developer Joby Aviation Inc. in the latest partnership between a traditional carrier and an upstart trying to revolutionize how people travel.

Delta could boost its investment to as much as $200 million when certain milestones are achieved in the partnership, which will be exclusive for at least five years, the companies announced Tuesday. The goal is to begin flying customers to and from airports in New York and Los Angeles using Joby’s four-passenger electric-powered vehicle as soon as it’s certified, which the company expects as soon as 2024.

“We’ll be integrating the Joby network in all of our customer channels,” Delta Chief Executive Officer Ed Bastian said. “This is going to fit right into the premium experience for our customers.”

Joby’s shares climbed 7.5% at 9:39 a.m. in New York, while Delta slipped 1%.

Delta joins United Airlines Holdings Inc. and American Airlines Group Inc., which have reached similar agreements with flying taxi manufacturers. Unlike those earlier deals, Joby will operate the flights and Delta isn’t planning to acquire any of the aircraft. 

The race to develop new aircraft that can climb straight up like a helicopter and fly like a plane -- known as electric vertical take-off and landing, or eVTOL -- has produced billions of dollars of investment and hype, but significant hurdles remain before it becomes a routine commercial service.

The Federal Aviation Administration has said it’s on schedule to certify Joby’s craft and a handful of others by 2024, but that is the first of several approvals the company will need before beginning operations. It must also be certified to build the devices and to operate them as what will essentially be a small airline.

There is also the question of building infrastructure for the air taxis. They’ll need landing pads in urban areas and major airports. 

Joby founder and Chief Executive Officer JoeBen Bevirt said its air taxi is quieter than current helicopters, which will allow it to use existing helicopter landing spots and to expand operations in densely populated areas.

The companies agreed to partner on flights within the US and UK, Joby said.