British startup Vertical Aerospace is expanding its electric aviation ambitions into the defense sector, unveiling plans to develop a hybrid-electric version of its VX4 aircraft as European defense spending surges in response to geopolitical tensions.
The company, known for its electric vertical takeoff and landing (eVTOL) aircraft designed for urban air mobility, said the hybrid model will offer a range of up to 1,000 miles — significantly more than the current fully electric version. Vertical has already secured over 1,500 preorders for the VX4 from major commercial customers including American Airlines, Japan Airlines, GOL, and Bristow.
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“We always knew this aircraft would be defense-capable because of the nature of it,” CEO Stuart Simpson said in a recent interview, adding that the new variant has been in development for 18 months. Vertical confirmed the hybrid VX4 will integrate a new powertrain and begin flight testing next year.
Vertical sees an opening in the European defense market as interest grows in low-emission, autonomous-capable aircraft. The company’s VTOL technology, featuring low acoustic and heat signatures, is seen as particularly suited for logistics and defense operations. The startup has partnered with Honeywell to develop its flight control and aircraft management systems — a collaboration aligned with Honeywell’s existing U.S. military projects.
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The announcement comes amid a wave of funding into European defense startups. According to industry data, venture capital investment in the sector reached $1 billion in 2023, a fivefold increase since 2018. European institutions have also launched dedicated funds, including the €1 billion NATO Innovation Fund and Estonia’s €100 million SmartCap defense fund.
With few regional competitors remaining, Vertical now occupies a rare position in Europe’s eVTOL industry. German firms Volocopter and Lilium have exited the market, leaving the UK-based startup as one of the continent’s last active players.
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Despite this strategic advantage, Vertical trails behind U.S. peers in capital raised. The company has secured $468.8 million to date, compared to over $2.8 billion for Joby Aviation and $3.3 billion for Archer Aviation. Vertical recently raised $90 million through a direct public offering in January and said it has been developing its hybrid model within a $100 million annual budget.
“Our competitors have been spending $400 [million] to $500 million,” Simpson noted. “We are incredibly efficient and focused.”
Unlike Joby and Archer, which are already investing in automated manufacturing lines, Vertical said it will focus on building a small number of aircraft manually before scaling production after achieving certification — currently targeted for 2028.
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“The hybrid power train will be integrated into our next-generation VX4 variant with flight testing planned to start next year,” Simpson said during the company’s first-quarter earnings call.
While Vertical has not yet secured defense customers, it said discussions with government agencies are ongoing. The company believes its position as the only active European eVTOL developer could help attract future defense contracts.