Eve, Embraer’s urban air mobility company, will operate in four major business areas and not only in the production and marketing of its electric vertical take-off and landing vehicle (eVTOL). On its way to being listed on the New York Stock Exchange (NYSE), it will operate in support and services, operations, and air traffic control, with the development of management software for the so-called flying cars.

“All the numbers available point to a large market. This is what attracted Embraer and led it to incubate this project in EmbraerX,” said Tuesday the Eve CEO, Andre Stein, at the Credit Suisse 2022 Latin America Investment conference.

According to the executive, this is a market of more than $750 billion by 2040, considering the urban air mobility ecosystem. For Eve, the initial conservative projections suggest potential revenue of $4.5 billion by 2030, with a 15% market share.

Launched as an independent startup in October 2020, Eve is in the process of merging with U.S.-based Zanite Acquisition, in a deal that values it at $2.4 billion. The deal was announced at the end of 2021 and is expected to close in the second quarter of 2022.

According to CFO Eduardo Couto, Eve plans to be listed at Nyse as of the second quarter. “This is a relatively new operation for Brazilian companies, mixing M&A with a traditional IPO,” he said.

Eve is joining an already listed company, which has about $237 million of cash. Another $305 million in new money will come into Eve’s cash reserves from the deal, so that after the merger the company will have raised more than $500 million to develop its project. Embraer will be the controlling shareholder, initially with an 80% stake in the company.

According to Mr. Stein, the decision to launch Eve as a company independent from Embraer will maintain the agility characteristic of startups while providing access to the resources and structure of a global leader, in this case the aircraft manufacturer. “Eve will be able to seek new partnerships very freely, and even new investors, which would not be possible as a division of Embraer,” he said.

With 17 announced partnerships and 1,735 aircraft in its order backlog, valued at $5.2 billion, Eve keeps plans to certify its eVTOL in 2025 and put it into commercial operation in 2026. The gross margin of the operation is expected to be around 25% and the EBITDA margin between 15% and 20%.

Four companies that are developing flying cars are already listed on the NYSE. But Eve’s management believes that its project is differentiated, given the size of the current order portfolio, the diversity of clients and the aeronautical knowledge of the partners, especially Embraer.

According to the executives, Eve also offers greater certification capacity, in the wake of Embraer’s accumulated experience with regulatory bodies and the close relationship between the National Civil Aviation Agency (Anac) and the FAA, the U.S. authority. According to Mr. Stein, the plan is to certify eVTOL first at Anac and then seek FAA validation. “Brazil has the potential to be one of the pioneers,” he said.

For Embraer’s Vice-President of People, ESG and Communication, Carlos Alberto Griner, electric propulsion corresponds to one of the main solutions for reducing the environmental impact of aviation — particularly in regional aviation, a market in which the Brazilian company stands out globally. “These changes will start with regional aviation. And Eve will revolutionize the market,” he says.