Will a US flying car designer take China’s Geely to the skies?
Zhejiang Geely says it has agreed to buy Terrafugia, adding to its portfolio of car brands that included Volvo, Lotus and Proton
China’s Zhejiang Geely, which owns Volvo and Lotus car brands, has agreed to buy Terrafugia, a US startup that designed the world’s first practical flying cars, as the Chinese carmaker taps into cutting edge technologies that could allow urban commuters to take to the skies in their cars.
The Hangzhou-based company that had just made global headlines with its takeover of a key stake in Malaysia’s Proton has been planning on a possible acquisition of Terrafugia since last year, a source familiar with the matter told the South China Morning Post. The purchase amount has not been disclosed.
The acquisition of the 11-year-old US flying car designer is the first attempt by a Chinese company to capitalise on a fancy yet exotic concept of a passenger vehicle that flies like an air plane in the air and drives like a car on the ground.
“Flying cars can be seen as an ‘ultimate solution’ to traffic problems and this concept can sound particularly appealing to urban Chinese who are often struggling with serious traffic congestions during peak hours,”said Yale Zhang, managing director with Automotive Foresight, a consultancy.
“Although it will take many years for makers of flying cars to achieve commercial success, it makes good sense for Geely to first go in and acquire the know-how for their long-term agenda.”
Unlike in the field of driverless cars, there are only a handful of startups worldwide are chasing a flying car dream, with proposed designs spanning from full-bodied aircraft to helicopter-esque models. It is over the recent years that larger firms like Uber have stepped in with own programmes dedicated to research on vertical take-off and landing of aerial vehicles.
Larry Page, a Google co-founder and now the chief executive of parent company Alphabet, has also secretly spent more than US$100 million on developing flying cars, according to US media reports.
Terrafugia, founded by a group of MIT graduates in 2006, is the designer of the world’s first practical flying car, called the Transition. It is currently accepting US$10,000 deposits for prospective buyers to reserve a spot in line to purchase the vehicle, with the first deliveries expected in three years’ time and at an estimated price tag of US$279,000.
The Boston-based startup said the “roadable aircraft” has a cruise range of 400 miles with top speeds up to 100 miles per hour, and is capable of driving at highway speeds.
It is also equipped with a full vehicle parachute and advanced autonomous flight technologies such as automatic terrain avoidance.
Terrafugia raised a total of US$5.82 million in five funding rounds from Boston-based angel investor Semyon Dukach and venture capital firm Transcendent Holdings, according to data from crunchbase.
However, experts cautioned that it could take an additional 10 to 20 years for flying cars to hit the roads in Asia, sparing commuters of traffic jam woes.
“First, you need to get a flying license, which is practically hard in Asia, and then the government will have to work out a comprehensive suite of regulations before allowing the vehicle to fly around,” Zhang said.
“And it is also worth noting that many flying cars still need a runway to take off, which you won’t have when you’re stuck in traffic.”