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Aerion’s Demise and the Bitter Puncture of the Supersonic Travel Bubble
Ten passengers, 7800 kilometers at Mach 1.4. London-New York in three hours. If the Concorde hadn’t existed, we would have said supersonic commercial flying was too good to be true. More than once, the aviation industry desperately searched for a disruptive element. It is still looking for that element today, among renders promising features close to the impossible, technology that only exists on paper and a horde of funds eager to participate in the last great business no one has seen yet.
Urban mobility with autonomous electric vehicles, hydrogen planes, supersonic and hypersonic jetliners: anything works to create a tech bubble and turn investors with a severe case of FOMO upside down until a coin drops.
One of these bubbles is undoubtedly the replacement for the most beautiful commercial aircraft ever built. One day, someone opened a gate and there they were: a few startups trying to create a faster, greener and cheaper Concorde 2.0. Boom Aerospace with the Overture, Aerion with the AS2, Spike Aerospace with the S-512. Or the HyperMach HyperStar, which raised a lot of eyebrows in 2011 with its Mach 5 36-seater airliner project but was last heard of in 2017. And some other projects that did not go beyond PowerPoint.
But finally, the bubble suffered a severe puncture: Aerion, one of the best-armed projects with support from Boeing and GE, informed its clients that it could not raise the necessary capital for development and will not be able to continue operating. GE confirmed that has stopped working on its Affinity supersonic engine, as its sole customer is no longer alive.
Asked by Private Jet Card Comparisons, Aerion said: “In the current financial environment, it has been shown that it is a great challenge to close deals to meet the new capital requirements scheduled and necessary to finalize the transition from AS2 to production. Given these conditions, Aerion Corporation is now taking appropriate action considering the current financial environment. ”
As if the challenges of a disruptive project didn’t suffice – lack of technological maturity, development costs, transition to production expenses – a global pandemic and its subsequent economic downturn that broke the commercial aviation market joined forces with a poor prospect for supersonic business travel now that another technology has become even more pervasive: remote connectivity. The companies that had a better chance of surviving this year and a half are the ones that could integrate remote work tools. Therefore, there’s no need for an expensive supersonic trip if businesses could solve things via Zoom. Times are changing.
Gone is the “significant investment” by Boeing, which had already decommissioned the engineering teams working on the AS2 last year. Gone are the 20 planes ordered by FlexJets, and the 20 by NetJets. At $120 million per aircraft, it was still necessary to know who ordered the 620 remaining aircraft Aerion said it had in its portfolio between firm orders and options, totaling $80 billion in assets.
Also gone is Aerion Park, a $300 million complex in Florida that was to create 700 jobs. None of that is going to happen. The pandemic context was an insurmountable factor for Aerion Corporation, which will save the renders for another time when supersonic flight is technically affordable and financially sound. And, of course, a new opportunity for those gullible and eager investors to show up.
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