U.S. federal authorities have given the company significant improvements with a new set of standards and regulations.
On Tuesday, the US federal government gave Joby Aviation (JOBY 12.57%) a very strong tailwind, which helped the company’s stock rise considerably that day. The stock rose nearly 13% on the news, outperforming the S&P 500 index, which was essentially flat.
Monster lift from FAA
On that day, the Federal Aviation Administration (FAA) officially introduced a new category of air transportation under its jurisdiction called electric lifts. This includes services such as cargo delivery and passenger air taxis, and Joby specializes in electric vertical takeoff and landing (eVTOL) aircraft designed specifically for this sector.
In this move, the FAA, best known as the aviation industry’s federal regulator, finalized the certifications and training that both instructors and pilots are expected to obtain. It also specifies a number of requirements regarding the operation of such machines.
Regulators said electric lifts are the first new category of aircraft in nearly 80 years.
Unsurprisingly, Joby was enthusiastic about this major development in his field. “The regulations announced today ensure that the United States continues to play a global leadership role in the development and adoption of clean flight,” said founder and CEO Joven Bebert. He reportedly said,
uncertain future
While the FAA’s move is a big step forward for next-generation air transportation services in general and for Joby in particular, keep in mind that it’s still early days for the electric lift industry (to use the FAA’s new terminology). As a business, Joby still needs to prove that it can be a viable and ultimately profitable operator in this still wide open space.
Eric Volkman has no position in any stocks mentioned. The Motley Fool has no position in any stocks mentioned. The Motley Fool has a disclosure policy.
