The Excitement of Investors – Part 1

A version of this article first appeared in our free newsletter, to subscribe click here

Introduction

I started working with aviation startup companies in 2001 and now our business consists of about 95% aviation startups. Occasionally I have been commissioned to carry out due diligence work for aviation investors, these assessments are based on some simple scratch tests that get you a quick feel for the likelihood a project is to meet investor expectations.

You also find out pretty quickly that investors do not like due diligence assessments that are not in agreement with their personal biases.

My approach is not luddite in nature. New technology is good, it is even better if it results in an overall superior aircraft product. However, the laws of physics are immutable, can be cruel, and they do not care if you try to attempt the impossible. They just passively guarantee your failure.

If you think the laws of physics are cruel and immutable, wait until you try to take your aircraft through certification.

In this newsletter I take a quick look at electric aircraft, hydrogen aircraft and ‘forward looking’ production numbers.

The usual caveats apply – there is lots of great engineering and innovation happening out there. That is not the issue – I am amazed by many of the eVTOL programs and their technical achievements. The level of investment, the price of the product, the performance of the product and the size of the market is where the concern should be targeted. Is there a market, what size is the market, and what price are they willing to bear for the performance you are offering?

I am afraid projects are avoiding realistic answers to these questions. To quote Adam Savage “I reject your reality and substitute my own.”. Many projects private reality and actual reality are further apart then most investors realize.

I have been blessed to have seen the good, the bad, the ugly and the SPAC.

Batteries

What’s wrong with electric aircraft? Generally nothing. Electricity exists, batteries exist and motors exist. They work. Almost 100% of the appliances in your home are electrical and they are all efficient and reliable. 

Current battery technology, when compared to a modern turbine engine and jet fuel is about 14 times less weight efficient. A good rule of thumb that if you convert over a conventional aircraft to electric power, flying at the same weight and speed you will have approximately 14 times less range or endurance.

When ever you see the published figures for an electric aircraft project, take an equivalent traditional form of air transport and divide their performance numbers by 14. If the electric aircraft range and endurance numbers are significantly higher than the number you come up with they are basing their numbers on a yet to exist battery technology, they believe they have made an aerodynamic breakthrough that will significantly reduce the drag, they have got their math wrong or you are looking at ‘shine’ added to the performance numbers to attract investment. Or a combination of all of the above.

A good example is the Eviation Alice (https://www.eviation.co/aircraft/#1). They claim 9 passengers, 440Nm, 220knots. It is not clear if these metrics are able to occur simultaneously but as no qualifier is given let’s make that assumption as it is clearly the assumption you are encouraged to make.

The equivalent traditional aircraft would be the PC-12 a turbine engine, 9 passenger aircraft. This has a cruise speed of 285knots (https://www.pilatus-aircraft.com/en/fly/pc-12) in their long range cruise configuration (255knots) with 6 passengers they have a maximum range of 1568Nm

If the PC-12 were to be electrified we can divide those numbers by 14 to get a rough idea for the range – 1568 / 14 = 112Nm.

Eviation may have discovered some hitherto unknown performance breakthrough. With their 440Nm range compared to the expected 112Nm range they have achieved a factor of around 4.0 over what a crude interpretation of conventional physics would predict.

Examining the data on their website it can be found that batteries will take up 60% of the MTOW and the occupants will weigh about 2500lb. With an MTOW of 14000lb the useful load constitutes 2500 / 14000 = 18% (approx.). This leaves the aircraft airframe and systems (the conventional empty weight) at 100 – (60 + 18) = 22% of MTOW.

This looks like one of those physics defying breakthroughs. We can compare it to available data. This is an oft used graph that I believe originated in the excellent book by Dan Raymer (https://arc.aiaa.org/doi/book/10.2514/4.104909)

From examination of the empty weight fraction defined on the y axis of the above graph, a value of 0.22 is literally off the scale.

I am not picking on Eviation – at least they have made their metrics publicly available and they may have some very clever justification for these numbers – some new materials technology to get the empty weight down to 22% and new battery technology that will give a huge improvement over current battery energy density. However, the skeptical side of me finds this hard to believe.

It should be noted that these claims are not extraordinary compared to similar projects. Indeed these level of claims have become commonplace. Once a level of acceptable level of ‘forward looking metrics’ has been established, in order to compete in the market for investment other projects have to match or even improve on the same ‘forward looking metrics’ to get an edge in the market for investment.

I am not going to cover the failure modes of current battery technology. They are not favorable for certification or overall safety. They can be mitigated but this takes additional weight and reduces the effective energy density of a battery powered system further still.

For those with EAS (Eco-Anxiety Syndrome): Will electric aircraft save the planet? No.

We still have to generate the power and create the infrastructure to charge the batteries when the aircraft are on the ground. Batteries use lots of nasty chemicals and they have a finite life and require safe disposal.

For those who are living with CFS (Carbon Fear Syndrome): The good news is that overall there is a chance that electric aircraft may produce less carbon than JetA fuelled aircraft.

For those of us with RPS (Realistic Physics Syndrome): Electric powered flight is possible and has been done. The commercial applications for aircraft with endurance less than the 1910 Wright Flyer Model B (https://en.wikipedia.org/wiki/Wright_Model_B) are, ahem, slightly limited.

EAS Score – 2/10

CFS Score – 3.5/10

RPS Score – 4/10

In the next article we tackle hydrogen.

2 thoughts on “The Excitement of Investors – Part 1

  1. Excellent article showing simple logic for the fundamental problem with existing or reasonably plausible improved battery technology. I think that the Urban Mobility Evtol projects have attracted a vast amount of hype and with the extra power required for take off, transitioning and landing with associated equipment to change that power to thrust, also noting the safety requirements of single failure cases, the resulting endurance may be unworkable for the investors to see returns.

  2. Very interesting read (two thumbs up).

    If I may though I’ll like to add a bit of insight as to why although – as you have correctly pointed out – the capacity ratio of batteries when compared to that of fossil fuels (in terms of energy density) being one whole order of magnitude less, electric powered, fixed wing aircraft are still a very attractive solution to a big problem to be solved and thus a credible and perhaps even compelling Value Proposition.

    It all comes down to gains made in terms of strength-to-weight ratio afforded as a result of adoption of new composite materials and also the improvements in aerodynamic efficiency of the airframe’s design, thanks also in part, to the adoption of composite materials and manufacturing processes (e.g. RTM) which facilitate aerodynamic shapes that allow new aircraft designs to achieve L/D ratios in excess of 25:1, as opposed to within the traditional range of somewhere between 8:1 and 17:1.

    Include also the fact that electric power plants are not air breathing and thus are not subject to significant ‘performance degradation’ with increasing altitude and we can appreciate a substantial ‘chipping away’ of the disadvantage posed by the ‘energy density’ gap.

    Operational procedure also can also bring gains through more efficient ‘energy consumption’ as Drag is reduced, keeping in mind that fossil fuel consumption is a direct function of Drag and the latter a function of the square of velocity and the density of the air in which the vehicle operates; fly higher and a bit slower perhaps ?

    Then there are all of the environmental benefits (adoption of ‘green energy’ sources and the like), operational cost benefits, etc., etc., all leading to quite a different picture in context of a “System of systems” perspective, I’d offer.

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Your email address will not be published. Required fields are marked *

The Excitement of Investors – Part 1

A version of this article first appeared in our free newsletter, to subscribe click here

Introduction

I started working with aviation startup companies in 2001 and now our business consists of about 95% aviation startups. Occasionally I have been commissioned to carry out due diligence work for aviation investors, these assessments are based on some simple scratch tests that get you a quick feel for the likelihood a project is to meet investor expectations.

You also find out pretty quickly that investors do not like due diligence assessments that are not in agreement with their personal biases.

My approach is not luddite in nature. New technology is good, it is even better if it results in an overall superior aircraft product. However, the laws of physics are immutable, can be cruel, and they do not care if you try to attempt the impossible. They just passively guarantee your failure.

If you think the laws of physics are cruel and immutable, wait until you try to take your aircraft through certification.

In this newsletter I take a quick look at electric aircraft, hydrogen aircraft and ‘forward looking’ production numbers.

The usual caveats apply – there is lots of great engineering and innovation happening out there. That is not the issue – I am amazed by many of the eVTOL programs and their technical achievements. The level of investment, the price of the product, the performance of the product and the size of the market is where the concern should be targeted. Is there a market, what size is the market, and what price are they willing to bear for the performance you are offering?

I am afraid projects are avoiding realistic answers to these questions. To quote Adam Savage “I reject your reality and substitute my own.”. Many projects private reality and actual reality are further apart then most investors realize.

I have been blessed to have seen the good, the bad, the ugly and the SPAC.

Batteries

What’s wrong with electric aircraft? Generally nothing. Electricity exists, batteries exist and motors exist. They work. Almost 100% of the appliances in your home are electrical and they are all efficient and reliable. 

Current battery technology, when compared to a modern turbine engine and jet fuel is about 14 times less weight efficient. A good rule of thumb that if you convert over a conventional aircraft to electric power, flying at the same weight and speed you will have approximately 14 times less range or endurance.

When ever you see the published figures for an electric aircraft project, take an equivalent traditional form of air transport and divide their performance numbers by 14. If the electric aircraft range and endurance numbers are significantly higher than the number you come up with they are basing their numbers on a yet to exist battery technology, they believe they have made an aerodynamic breakthrough that will significantly reduce the drag, they have got their math wrong or you are looking at ‘shine’ added to the performance numbers to attract investment. Or a combination of all of the above.

A good example is the Eviation Alice (https://www.eviation.co/aircraft/#1). They claim 9 passengers, 440Nm, 220knots. It is not clear if these metrics are able to occur simultaneously but as no qualifier is given let’s make that assumption as it is clearly the assumption you are encouraged to make.

The equivalent traditional aircraft would be the PC-12 a turbine engine, 9 passenger aircraft. This has a cruise speed of 285knots (https://www.pilatus-aircraft.com/en/fly/pc-12) in their long range cruise configuration (255knots) with 6 passengers they have a maximum range of 1568Nm

If the PC-12 were to be electrified we can divide those numbers by 14 to get a rough idea for the range – 1568 / 14 = 112Nm.

Eviation may have discovered some hitherto unknown performance breakthrough. With their 440Nm range compared to the expected 112Nm range they have achieved a factor of around 4.0 over what a crude interpretation of conventional physics would predict.

Examining the data on their website it can be found that batteries will take up 60% of the MTOW and the occupants will weigh about 2500lb. With an MTOW of 14000lb the useful load constitutes 2500 / 14000 = 18% (approx.). This leaves the aircraft airframe and systems (the conventional empty weight) at 100 – (60 + 18) = 22% of MTOW.

This looks like one of those physics defying breakthroughs. We can compare it to available data. This is an oft used graph that I believe originated in the excellent book by Dan Raymer (https://arc.aiaa.org/doi/book/10.2514/4.104909)

From examination of the empty weight fraction defined on the y axis of the above graph, a value of 0.22 is literally off the scale.

I am not picking on Eviation – at least they have made their metrics publicly available and they may have some very clever justification for these numbers – some new materials technology to get the empty weight down to 22% and new battery technology that will give a huge improvement over current battery energy density. However, the skeptical side of me finds this hard to believe.

It should be noted that these claims are not extraordinary compared to similar projects. Indeed these level of claims have become commonplace. Once a level of acceptable level of ‘forward looking metrics’ has been established, in order to compete in the market for investment other projects have to match or even improve on the same ‘forward looking metrics’ to get an edge in the market for investment.

I am not going to cover the failure modes of current battery technology. They are not favorable for certification or overall safety. They can be mitigated but this takes additional weight and reduces the effective energy density of a battery powered system further still.

For those with EAS (Eco-Anxiety Syndrome): Will electric aircraft save the planet? No.

We still have to generate the power and create the infrastructure to charge the batteries when the aircraft are on the ground. Batteries use lots of nasty chemicals and they have a finite life and require safe disposal.

For those who are living with CFS (Carbon Fear Syndrome): The good news is that overall there is a chance that electric aircraft may produce less carbon than JetA fuelled aircraft.

For those of us with RPS (Realistic Physics Syndrome): Electric powered flight is possible and has been done. The commercial applications for aircraft with endurance less than the 1910 Wright Flyer Model B (https://en.wikipedia.org/wiki/Wright_Model_B) are, ahem, slightly limited.

EAS Score – 2/10

CFS Score – 3.5/10

RPS Score – 4/10

In the next article we tackle hydrogen.

2 thoughts on “The Excitement of Investors – Part 1

  1. Excellent article showing simple logic for the fundamental problem with existing or reasonably plausible improved battery technology. I think that the Urban Mobility Evtol projects have attracted a vast amount of hype and with the extra power required for take off, transitioning and landing with associated equipment to change that power to thrust, also noting the safety requirements of single failure cases, the resulting endurance may be unworkable for the investors to see returns.

  2. Very interesting read (two thumbs up).

    If I may though I’ll like to add a bit of insight as to why although – as you have correctly pointed out – the capacity ratio of batteries when compared to that of fossil fuels (in terms of energy density) being one whole order of magnitude less, electric powered, fixed wing aircraft are still a very attractive solution to a big problem to be solved and thus a credible and perhaps even compelling Value Proposition.

    It all comes down to gains made in terms of strength-to-weight ratio afforded as a result of adoption of new composite materials and also the improvements in aerodynamic efficiency of the airframe’s design, thanks also in part, to the adoption of composite materials and manufacturing processes (e.g. RTM) which facilitate aerodynamic shapes that allow new aircraft designs to achieve L/D ratios in excess of 25:1, as opposed to within the traditional range of somewhere between 8:1 and 17:1.

    Include also the fact that electric power plants are not air breathing and thus are not subject to significant ‘performance degradation’ with increasing altitude and we can appreciate a substantial ‘chipping away’ of the disadvantage posed by the ‘energy density’ gap.

    Operational procedure also can also bring gains through more efficient ‘energy consumption’ as Drag is reduced, keeping in mind that fossil fuel consumption is a direct function of Drag and the latter a function of the square of velocity and the density of the air in which the vehicle operates; fly higher and a bit slower perhaps ?

    Then there are all of the environmental benefits (adoption of ‘green energy’ sources and the like), operational cost benefits, etc., etc., all leading to quite a different picture in context of a “System of systems” perspective, I’d offer.

Comment On This Post

Your email address will not be published. Required fields are marked *