Germany which is responsible for 4.8% of the global manufacturing output, has been affected more than many other European countries in the downturn in manufacturing after the Covid-19 pandemic. Combined with the increase in cost of energy due to the embargo on Russian energy after the Russo-Ukrainian War, lower demand for new automobiles, and increased competition from China, Germany should be looking for a way to maintain their technological edge in the world.
Manufacturing production indices (2019Q4=100)
- Germany suffers the same issues as the rest of the euro area. Source: Centre for Economic Policy Research (CEPR)
Rather than look to the future, the German government turned their back on the technology that could have propelled the country into decades of prosperity.
Lilium was offered €50 million from the state of Bavaria if it could get a an equal €50 million backing from the German federal government. The German parliament foolishly refused. Short-sighted politicians such as Frank Schäffler of the Free Democratic Party (FDP) said at the time: “I think it is wrong to help Lilium.” Besides the FDP, the Greens were also against supporting Lilium and their eco-friendly all-electric jets, which were seen as transportation for the rich.
Others, including FDP members with ties to Bavaria, held wiser views:
“By blocking the Lilium guarantee, the Greens are showing that they lack the foresight for future technologies and Germany as a business location. While billions of taxpayers’ money are flowing into questionable projects with a green label, there is no room for real innovations such as the flying taxi project. Such decisions risk important jobs and valuable know-how moving abroad. A disappointing day for the aviation industry in Germany and Bavaria – and a setback for our business location.” – Lukas Köhler MdB, deputy chairman of the FDP Bavaria and vice-chairman of the FDP parliamentary group.
“I regret that, despite intensive negotiations within the coalition, no agreement could be reached on aid for Lilium. For the FDP faction, after in-depth discussions, the chances of federal aid outweighed the risks. The failure is not a good signal for the company, the jobs and Bavaria as a high-tech location. At the same time, the case also makes it clear that we need a clearer strategy for financing and promoting start-ups in Germany and Bavaria.” – Karsten Klein MdB, The deputy chairman of the FDP Bavaria, regional group leader and chairman of the FDP parliamentary group in the Budget Committee.
“Germany cannot afford to allow industrial jobs of the future to disappear…That is why we as the SPD would have liked to have given state support to this climate-neutral technology of the future. Unfortunately, there was no majority for this economic policy conviction in the current coalition.” – Dennis Rohde, Bundestag Budget Officer, and member of the Social Democratic Party.
Lilium’s collapse would not only affect Lilium, but would cause “sustainable reputational damage to Germany as a deep-tech location” – Christoph Stresing, Managing Director of the Federal Association of German Startups
“a promising idea, electric aviation, where the whole world is looking to Germany for patents, the federal government would not be prepared to invest a minimal amount……Then another technology will leave the country ..that cannot be our goal.” – Markus Söder, Bavarian Prime Minister and and member of the political party Christian Social Union of Bavaria (CSU)
“We have done our homework! We are all the more surprised that things are now stuck at the federal level!…….It is primarily a question of whether we want to develop an absolutely future-oriented technology here in Germany and bring it to industrial maturity, or whether we want to leave the new technological leaps and ultimately industrialization and new jobs to others. That would be negligent.” – Markus Blume, Bavarian State Minister for Science and Arts, and member of the political party Christian Social Union of Bavaria (CSU).
Comments from Lilium execs below:
“Do we now want to let the electrification of aviation migrate abroad if the world’s best technology for this has been developed by German engineers? Shouldn’t even pragmatism win over ideology here? Does Germany want to buy electric aircraft in the U.S. and China in the future, just as passenger aircraft (Boeing, McDonnell Douglas, Lockheed) did back then, because we didn’t have our own industry?” – Klaus Roewe, CEO of Lilium
“I am disappointed by our country’s inability to act,” Daniel Wiegand, Co-founder of Lilium and Chief Engineer for Innovation
Daniel Weigand, who had the boldness to start an electric aerospace company in Germany, said he did so because he’s “patriotic and stubborn.” Nevertheless the German federal government doesn’t support patriotism, boldness or ambitious goals. They support more of the same of what they see in the mirror: sloth, stagnation, complacency, and cowardness.
Lilium had a unique story, Daniel Wiegand, Sebastian Born, Matthias Meiner and Patrick Nathen formed the company as engineers and PhD students at the Technical University of Munich. This was particularly special, because had it succeeded, it would have shown how those with the technical skills and vision could have reaped the rewards for themselves by starting their own company, rather than selling their brilliance and technical skills for crumbs as regular employees to a mega corporation ran by people who often have no clue about engineering and science.
Had Daniel Wiegand, and his colleagues began their company in America and made it to the point of where they had 106 confirmed orders and 600 pre-orders, it is highly doubtful Lilium would had suffered bankruptcy. Congressmen and senators from their state would have lobbied for Federal funds, Wall Street would have been salivating over the thought of having a slice of that electric pie. Instead, Archer funded largely by Blackrock-managed assets (along with Stellantis and Vanguard) and Joby funded by Toyota will have access to huge government (including military) contracts to keep them afloat with the necessary funds to back their civilian and military projects.
We started with nothing more than a shared dream, working out of a tiny shared flat room for nearly two years. Our meals were either ramen or Sebastian’s [Born] famous pizza noodles while we poured every bit of energy into building our first prototypes. I’ll never forget our first seed investment from Freigeist (formerly e42). Frank [Thelen] once said: “My heart says yes, my head says no.” That’s what it takes to take a leap of faith.
Scaling the company with visionary investors and partners, going public to secure funding for one of the most ambitious deep-tech endeavors—it’s been a ride filled with dizzying highs and soul-crushing lows. It has cost us so much, but I would do it all over again, without hesitation, 100%. – Patrick Nathen, Lilium Co-founder and Chief of Global Product Strategy
With the failures in Germany, primarily at the hands of the Green Party, it seems as if France would have been a better option for Lilium. VTOL buzz previously reported of talks between the French government providing €220 million in funding for Lilium to manufacture its aircraft in France.
The French investment is a direct result of the “Choose France Summit” held on the 13th of May at the Château de Versailles, in which Lilium was in talks with the French government regarding financial investment into the company. Lilium could utilize France’s highly developed aerospace sector, its historical pedigree and bring 850 jobs to France while securing €220 million in necessary funding from the French government. France has a large supplier base in its aerospace industry, which would enable Lilium to acquire parts and other supplies at more competitive prices. France is also the world’s largest net exporter of electricity, with 65% derived from nuclear power, and 14% from wind and solar. Only 8% of France’s electricity is produced from fossil fuels. As France has already done with the electrification of the railways, France can power air travel with cleaner electric energy thanks to Lilium. Thus, Lilium could provide France with a green portfolio (or maybe blue, as in clean blue skies) within the aerospace sector that perfectly aligns with the French values regarding taking care of the planet. VTOL buzz article here: click link
A false hope came during Christmas Eve 2024, when Lilium announced that an asset purchase agreement with Mobile Uplift Corporation GmbH (MUC) had materialized, and MUC which was headed by Philipp Schoeller would purchase the cash depleted Subsidiaries Lilium GmbH and Lilium eAircraft GmbH. As we reported in our article on Christmas Day, Mobile Uplift Corporation GmbH planned to “immediately” employ the majority of the Lilium employees whose contracts were terminated on December 20th 2024 under the requirements of German law, once the transaction had been finalized in early January 2025.
Nevertheless, reports in February indicated that these Lilium employees haven’t been paid their salaries, and were waiting until St. Valentine’s Day for their January paychecks. There were doubts of how much cash was actually injected into this new Lilium company, now called Lilium Aerospace GmbH. Severin Tatarczyk replaced Philipp Schoeller, and agreed to wait past St. Valentine’s day before initiating a second bankruptcy based on the hopes and promises of €150 million in funding arranged by Marian Boček, who in the presence of his lawyer assured that a portion of the €150 million will be shortly available to keep Lilium operations running and pay its salary and vendor obligations in the next few months. For reasons unknown, the funds promised by Marian Boček never materialized, and Lilium filed for a second bankruptcy, as announced on February 21st 2025.
Statement from Lilium’s Internal Comms Team, explaining the decision to proceed with the 2nd bankruptcy filing
Severin Tatarczyk’s statement (translated from German):
“Lilium Aerospace has filed for insolvency
Munich, February 21, 2025. As the funding options to secure Lilium’s future have not materialized in time, Lilium Aerospace has filed for insolvency today. While talks about alternative solutions are still ongoing, the chance for restructuring right now is highly unlikely and therefore operations will be stopped.
Giving the situation, this is deeply regretful for all employees and Lilium Aerospace thanks them for their resilience and dedication.”
We will see what the future holds for Lilium as a company, its technology, and the employees of Lilium. The potential is there for a bright future of all-electric Lilium jets, and with the right investors it can still happen. Let’s wish Lilium and its employees all the best and hope this is not the final end of Lilium as a pioneer in the future of aviation.