n n n ‘. concat(e. i18n. t(“search. voice. recognition_retry”),’n
Andy Missan; General Counsel; Archer Aviation Inc.
Tom Muñiz; Chief executive officer; Archer Aviation Inc.
Marc Mesler; CHIEF FINANCIAL OFFICER; Archer Aviation Inc.
Operator
Good morning and thank you for Archer Aviation Incorporated’s fourth quarter 23 financial results conference call. My call is Kate and I will be the moderator of today’s call. (Operator Instructions) Now I’d like to turn the floor over to your host, Andy. Missan, General Counsel. You can continue.
Andy Missan
Thanks operator. Hello everyone, and thank you for joining us to review Archer’s fourth quarter and complete the fiscal 2023 operational and monetary effects. My call is Andy Missan, general counsel at Archer. On the callArray Adam Goldstein, our founder and CEO; Mark Mesler, our CFO; and Tom Muniz, our director of operations. During the call, we will make forward-looking statements. These statements involve dangers and uncertainties that could possibly cause actual effects to differ materially from those contemplated in the forward-looking statements. For more information on those dangers and insecurities, please see our filings with the SEC under the heading Risk Factors. Any forward-looking statements we make in connection with this call are based on Array’s assumptions and we undertake no legal responsibility to update those statements as a result of new data or long-term events. Array During this call, we will discuss GAAP and non-GAAP monetary measures. A reconciliation of certain GAAP measures to non-GAAP measures is included in our letter to shareholders posted on our IR website. And now I’d like to turn it over to Adam.
Archer has taken a unique and specific path to certification, scale, production and advertising. I’ll explain why our technique in each of those spaces gives me confidence that we will be able to be consistent nationally in 2025. First, we have designed our aircraft from day one for certification, now that the focus of our team changes. to the final primary phase of the Midnight Certification Program, which the FDA calls the Implementation Phase. We believe our technique has shortened our path to certification and will consistently allow us to get there before anyone else in the industry. As you saw in our previous announcement today, approximately 80% of Midnight’s subsystems and elements come from leading aerospace suppliers with certification heritage, meaning they are already flying on loads or thousands of other qualified aircraft today or are derived from from others in the beyond of qualified designs. Since the FAA is already very familiar with those systems in their certification history. This strategy has consistently prevented us from temporarily maturing design and midnight verification, which has prevented us from becoming what we believe is the first company in the industry to simultaneously build 3 compatible aircraft to be used in pilot and flight verification. and to download effects. consistent with FA. It is a component of our FAA type certification program. Today it is even clearer to us that if we had followed the path of fully vertical integration, we would face a threat an order of magnitude greater than the certification of the R&D budget and uncertainty about our ability to increase production and publish meaningful or coherent advertisements. Instead, our groups continued to execute at a constant, targeted speed with the most productive and consistent suppliers in the aerospace industry, with minimal threat of initiating a costly redesign. As you may have noted in our letter to percentage holders, we have compiled detailed information regarding the strategic sourcing of our aircraft subsystems and elements, as well as the steps we will take as part of the implementation phase. implementation of our certification program. Tom will explain this in more detail in an effort to gain more clarity on how we have been able and plan to continue to progress well through the FAA certification process. Equally vital is the continued determination of our team to ensure we can scale our production to meet needs. You may not have learned it, but Stellantis was actually the first of the strategic relationship reforms even before United. When I founded Archer, researching the electric vehicle industry, I knew that reaching the maximum level to manufacture our aircraft in the highest volume was perhaps the most important factor in our long-term success, along with designing and certifying aircraft. We’ve been knowingly doing this since 2020. And combined, we’re on track to build out our entire high-volume production facility in Georgia by the end of this year, which will be capable of generating up to 650 aircraft per year. This positions us as the only company in the industry with the capabilities to produce and deliver scale aircraft in 2025 and the second part of this decade. There’s still a lot of work to be done to scale production, but there’s no better component to do it with since The Lumpiness recently announced that they had made a profit on electric cars and were going full speed ahead when the time came. electrification. Our sales team is seeing high demand for electric vehicle toll planes globally and potential consumers are very excited about what this can offer. Therefore, we are lucky to have several viable options, both locally and abroad, for an immediate advertising launch. These same consumers now realize that in the coming years, we will most likely be the only player in the industry promoting an airplane that is FAA rated and can also be produced in giant volumes. As a result, our team has built a strong indicative order book of up to 700 aircraft, with a potential price tag of $3. 5 billion, putting us in a formidable position to deliver our components around the world by midnight and , in turn, start to generate a significant source of income. source of income for Archer starting next year. In the United Arab Emirates, we see promising overnight spots in Abu Dhabi and Dubai, as well as an air corridor between the two cities. We have established agreements with two major airlines, Chateau and Falcon Aviation. We continue to believe that this primary market will be an early launch market for us. We also continue to believe that India will be the world’s largest market for flying cars, and are temporarily moving forward by building a joint venture with our component, Inter Globe Enterprises, India’s largest travel, aviation and generation conglomerate. hospitality, with which we plan to launch an air taxi service in the direction of Delhi, Mumbai and Bengaluru in 2026. This brings us to the last but possibly the most vital detail of our strategy: capital power. Our goal is to execute a low capital cost technique to grow the business. This technique extends to everything we do, from our resolution to working with primary aerospace suppliers on 80% of our subsystems and things rather than vertical integration and, more broadly, to the way we technify production and form where we deploy planes. In an electric vehicle and toll vehicle industry, increasing production is typically one of the most important capital requirements. Our purpose has been to concentrate our use of capital on aircraft design and certification and minimize the capital we will have to deploy to achieve volume production capabilities. That’s why we announced last year our resolve to become the largest contract aircraft manufacturer. Our plan is for Stellantis to absorb the additional and future capital expenditures required to produce batches of midnight aircraft per year, and we will collaborate together to ensure we have an appropriate supply chain strategy and production aircraft at the lowest cost imaginable. From there, we plan to have a turnkey relationship with Stellantis that will help us fulfill our aircraft desires for our direct-to-consumer UAM business, as well as our global base of visitors who need to order aircraft and ship them at midnight worldwide. world for your advertising display. . Array We are immediately maturing our contract production plans and aim to finalize the main milestones by the end of this year, as the launch has absorbed the large primary capital expenditure and capital needs to manufacture our aircraft at scale . I believe we are the only EV toll company in the world to announce such a relationship with a leading automaker, giving us significant cash flow benefits over our competition who are investing millions of dollars in production off its own balance sheet. sheet. Array We will continue to be consistent with more key points in the strategy in the coming quarters, but this puts us in an unprecedented position to bring this business to market very well. You can see this power in our monetary position, which has necessarily remained strong in recent quarters, even during some of the most intense spending consisting of periods as we were building our control laboratories, our production facilities in California and were expanding our source. . chain and multi-zone structure. Mark will explain this in more detail, as well as our expected expenses. But I must emphasize that our current spending guidance includes capital and current capital expenditures that can also be controlled prospectively when we finalize our contract production agreement. Therefore, this represents significant potential relief on the spending we expect to make over the long term between this facility, the strategic contract manufacturing relationships with Stellantis, and their continued willingness to invest capital directly into Archer. I am very pleased with their alignment to ensure we remain well capitalized as we work together to bring the business to market as temporarily as possible. It was wonderful to host the statement from CEO Carlos Tavares; Board Chairman John Elkann and several other science team leaders at Archer’s headquarters and embedded control laboratory and production facilities last month sought to become more aligned with our strategy. Now I need to take a moment to thank the FAA for their continued support and support of our industry. I flew to Washington, DC to meet with Administrator Michael Whittaker a few weeks ago and I am pleased that the Administration has chosen more than ever to prioritize mobility, innovation, and the Air Force complex. This has been evident in our interactions with regulators over the past several months, especially as we have had the opportunity to regularly host FAA leaders at our California facilities. In particular, the FAA recently awarded Archer our Part 145 certification, and we are grateful to be one of only two corporations globally to achieve this milestone, which is a major vote of confidence from the FAA in our purpose of serving the next year. . Lastly, you may have heard me use the term flying cars today. As we expand Archer’s success around the world, we also began to think seriously about the advertising nomenclature for our aircraft. Former NASA executive Mark Moore first coined the term electric vehicle tolling or electric vertical takeoff and landing with his invention of the groundbreaking airplane in 2009. In turn, he helped jumpstart our industry and the call has lasted longer It’s been a decade, but there’s no doubt that it’s still a mouthful for newcomers. Peter Teal, known for saying that the world was looking for flying cars and instead they gave them 140 characters, was not wrong. He arrived only a few years late. Therefore, we decided to adopt the term flying cars, because in order to make urban air mobility available to the general public, we will have to integrate the long term of maritime transport into today’s reality. The fact that flying cars are starting to enter society is a testament to the hard jobs everyone here at Archer, our components, and others in the industry are doing. We’re not just innovating the shipping industry, we’re redefining it. Turning those that have been introduced into reality, one flight at a time. With that, I’ll hand it over to Tom.
Tom Muñiz
Marc Mesler
Thanks tom. When you combine all the key achievements that Adam and Tom just discussed, it becomes clear. We have made tremendous progress in key spaces that will allow Archer to achieve advertising, certification, large-scale production and advertising component partnerships. It’s wonderful to see how all the pieces start to come together. Before moving on to our ongoing monetary performance, I would like to briefly remind you of some key points of our business style and how it will operate as we become successful in advertising, in particular the effect of expanding our indicative order. book. Remember that Archer’s marketing strategy is a hybrid technique in which we sell aircraft to different suppliers through what we call Archer direct, similar to the OEM style, and use our aircraft to operate as a direct air sharing service. to consumers on express routes. so we call Air Archer. This hybrid technique allows us to take advantage of direct sales opportunities from the beginning of our business to generate significant profits. As the air ridesharing business has grown over the past year, we have built a significant indicative order book for direct sales of our aircraft to our fleets. As we defined in our letter to shareholders, we currently have assets in a position to prospectively deliver up to 700 aircraft after certification. With an estimated average advertising value of $5 million each, we have the potential to generate up to $3. 5 billion in revenue from this order book. Additionally, we expect our indicative order book for direct aircraft sales to continue to grow in 2024 and 2025 as we will most likely be the only OEM in the market position with an FAA-certified aircraft available for sale. purchased and can be produced in volume. Matrix This creates a tremendous opportunity to take off and generate significant profits and cash flow for the business. This is a key business-style differentiator compared to other industry players who will only operate their aircraft within their own UAM networks. Obviously, there are many pieces that need to be put in place to achieve publicity and there is a lot of hard work to do, but we are confident that we have the team to do it. Now let’s move on to our consistent monetary compliance. We have been very thoughtful in the way we manage our liquidity. Over the past four quarters, Archer’s unlimited money balance has remained relatively stable. In fact, you can see that our cash flow actually increased slightly from Q3 2023 to Q4 2023. Our liquidity strength has been aided by our relationship with Stellantis. Last year, Stellantis provided us with a $150 million inventory advance purchase agreement that allowed Archer to access this capital at our discretion. This allowed us to opportunistically leverage superior share value to minimize dilution. We anticipate that this release will continue to obtain this type of liquidity assistance through advertising. Given our position as a long-term strategic component of the company, we expect them to do so on attractive terms and through attractive structures. We ended FY23 with approximately $625 million of liquidity, including $464. 6 million of cash and cash equivalents on our balance sheet, combined with approximately $153 million remaining in debt and equity proceeds. under our various agreements. We also have another $6. 9 million in limited money. Quarter over quarter, cash build increased by $3. 2 million, from $451. 4 million to $454. 6 million. Cash used for acquisitions and acquisitions of property, plant and equipment in the fourth quarter was $91. 2 million, offset by net debt and equity financing activities of approximately $94 million. Dollars. Year-over-year, money decreased by $66. 6 million, from $531. 2 million to $464. 6 million, primarily due to money used in consistent operations and in the purchase of property, plant and apparatus consistently for $ 314. 1 million, offset by net debt and equity financing activities of $248. 3 million. I also note that we made approximately $2 million in profits from the Department of Defense for the centers that we consistently formed under our contract with the Air Force for the year. Turning to GAAP expenses, overall expenses consistent with expenses for the fourth quarter of 2023 were $107. 3 million, including $20. 4 million in inventory-based payments. and $4. 4 million in warranty expenses. These effects were within our estimated diversity beyond $100 million to $110 million. For full fiscal year 23, GAAP overhead expenses were $446. 9 million, totaling $135. 1 million in non-cash expenses, adding inventory-based refund guarantee expenses and other items. Our fourth quarter 2023 non-GAAP overhead expenses were $87. 5 million, which was just above the high end of our diversity estimate of $85 million due to the opportunistic acceleration of certain supplier expenses during the quarter also for non-recurring costs and centers. As for airplanes. factors, as we begin production of our first 3 compliant aircraft. We incurred approximately $19 million in one-time costs and drastic expenses with our suppliers during the quarter, an increase from $12 million to $15 million in the quarter we had consistently through the first three quarters of 2023. For the full fiscal year In 2023, our non-GAAP or consistent overhead expenses were $307. 8 million. Consistent annual expenses for the year come with mandatory investments to achieve the key elements of our market positioning plan. We continue to invest in design progression, verification and certification activities for our flagship aircraft. Additionally, we have incurred expenses in several of our source chain components to identify mandatory applications to manufacture factors and systems for our midnight plane. We have invested in construction production facilities in California and in the set of painters and infrastructure for our SG&A purposes necessary to expand our business relationships. Of the total $328 million in non-GAAP administrative expenses for the year, approximately $60 million was for non-recurring pricing and drastic expenses with our suppliers. We expect that through 2024 we will continue to be very disciplined in our efforts to achieve advertising in the most capital-effective way possible. I will communicate shortly about 2024 and the dynamics that will have an effect on our ending. In support of the efforts outlined by Adam and Tom, our end of the year will focus on building our fleet of six compliant hijacked aircraft, of which we have already begun manufacturing the first 3, and completing our installation high-volume production facility in Covington. , Georgia. Array Continue to invest in our supplier applications to support on-site production of our factors and continue to strengthen our critical purpose workforce in support of our technical certification and flight verification efforts, unleashing our production at scale , making an investment. in our possession, other aid and infrastructure. groups to enable our planned advertising. As Adam mentioned, in an effort to finalize our commitments to act as a contract manufacturer, in the long term we have the option to offset and, in particular, reduce our money outlays with respect to capital expenditures, one-time expenses similar to building our chain of origin, the production workforce, the draconsistent components withys and any other expenditure of money similar to the increase in production scale. On the revenue side, we expect to see further benefits from our year-round contracts with the Department of Defense for viapass flight verification, aircraft delivery, battery energy storage systems, pilot education and flight simulators. flight and the progression of autonomy. In addition, we also expect to obtain additional pre-delivery invoices for our existing aircraft commitments under our new agreement to be executed in this context by the first quarter of 2024. We anticipate GAAP-consistent overhead of approximately $100. million to $120 million, which comes with an expected spare parts inventory. rights-based reimbursement and underwriting of approximately $25 million, resulting in non-GAAP overhead expenses of $75 million to $95 million. According to the author, we will now open it for questions.
Operator
Thank you. (Operator’s Instructions) Savi Syth, Raymond James.
And hey, smart afternoon. In terms of burning money, Mark, I wonder if you can sense what’s happening in other types of tailwinds as well. But I was curious, as the quarters go by, do you plan to intensify your efforts or why are you getting advantages from some of this favorable cash flow?Yes, we deserve it to be a little more stable.
Marc Mesler
I think I spoke to you through a Savi framework. So, as I pointed out, our spending is sometimes divided into 4 categories. We have staff, one-time investments, IT and CapEx providers. And given our reliance on Tier 1 providers and maturity of the program. The expansion of our workforce is expected to be more modest this year than in the future and the increase in price portions similar to those of compliant EPS and flight control cars are more ad hoc in nature. to see our quarterly run rate go down in the second part of the year and, let’s say, the run rate, I mean, Jeff, the diversity that I provided for the first quarter, you might see this contract in the second part of the year.
That’s helpful. And if I may, with regard to flight testing, could you give us a little more detail about the scope of such testing, the timing of the year and the proportion of tests that will be carried out depending on the type of flight?Testing. The existing aircraft you own compared to compatible aircraft. I just need to appreciate some of them, the magnitude of the paintings that will be here in 2024.
Tom Muñiz
Hi Savi, thanks for the question. The last few months have been wonderful in terms of flight verification. As we discussed on the call, we’ve flown over 50 flights between now and the last earnings call. In fact, we’re satisfied with that. Some days, there were five or more flights per day, and we plan to increase that particular number in the coming weeks and months. In terms of what to expect, we’re still in the flyaround expansion verification campaign for midnight. So we continue to fly faster and faster in the transition. And then our main goal is to start with flight verification later this year, and we’re on track to do that in that part of the year.
Operator
Edison Yu, Deutsche Bank.
Hey, thanks for answering the questions. I was just looking to communicate about the timeline, if you combine everything you discussed about studies and flight testing, what would be a realistic timeline or the diversity of effects you could see to get to operations?
Tom Muñiz
Yes, Hi Edison, here’s Tom. I think the right way to think about this is to just take a look at our strategy holistically. That’s why we tried to emphasize in this quarter’s docs that everything we did was based on minimizing threat certification. Going from partnering with suppliers to employing parts with a secure heritage and all that combined with a very undeniable aircraft design that allows us to have a path ahead that is as transparent as possible. I’m here today. I can say that I am confident in the maturity of the aircraft’s design and in the road ahead. There is still a lot of work to be done, evidently for the aircraft to pass certification. But their relationship with the FAA is incredibly positive and we’re making a lot of progress in terms of the exact timeline for certification. I think it’s already there, hey, that point, but we’re doing everything we can to be in a position to market next year.
Compris. Et then keeps up with the DOD. I know that they discussed that they had some input. What do you think of the contribution for this year?And the first plane on track to receive an early contract?
Because the midnight flight verification program was a success, we essentially went into run mode with the Department of Defense for this aircraft. And now we’re waiting for the date when we can begin this delivery procedure to begin flight verification with the Department of Defense. So we’re still hoping that will happen in the short term. But in the meantime, we’ve prioritized other efforts with the Department of Defense. So we started running autonomous flight simulators that cross, use check effects certification, and several other topics. And as Mark discussed in the ready comments, we’ve already started raising cash against us. And that’s okay, we haven’t given any indication of the total amount we’ll be hoping to get this year. And thanks to them, we’ll be hoping this will drive the year forward.
Operator
Andrew Sheppard, Cantor Fitzgerald.
Hello World. A wonderful afternoon. Thank you for responding to our inquiry and congratulations on the quarter and I think I wanted to make an inquiry about the certification of the various parties. I’m referring, I guess in this case, to slide 3. Which, by the way, I think it’s a wonderful thing that we’re adding that. My question is this: I’m just looking to perceive that the point of view behind all of this is essentially the idea procedure that, because you’re getting those parts instead of producing them, then they expect the certification procedure to be much faster or smoother. I guess I’m just looking to perceive the narrative, if you’ll allow me maybe a little bit more, that would be wonderful. Thank you.
Tom Muñiz
Yes. Hi Andreas, I’m Tom. Absolutely. So yes, it’s true. And in reality we are the ones who execute the strategy that we proposed a few years ago. So by partnering with experienced aerospace suppliers and opting for subsystems and parts with heritage certification, we necessarily have all the experience and wisdom of all those, beyond aircraft systems, who help us get things done. And we really want to get a sense of what the graph is referring to or what you can see, with the exception of the electric propulsion system, which we do in-house for the vast majority of the other systems. We are the ones who run corporations like Saffron, Garmin, Honeywell, FACC. And that’s why we can make a lot of progress and have a very transparent vision of what we want to do. I think the other thing in the mix is that we actually designed the plane to be as undeniable as possible. So if you take an example, if you think you’re flying on an airplane today, you look out the window, there are flaps moving or control surfaces moving on the wing, everyone can see them and those are from classic aerospace suppliers, corporations like Hello. So, although we are not using the precise actuator, it is in an airplane that you see today. And a lot of what we do is based on that same generation with the same certification experience. So we think this positions us very well to move forward through this last phase of the certification process.
They gave it to me. It’s super useful. Thank you for that. And we’d possibly do a quick follow-up regarding the order books you’ve revealed, looking to get an idea. Is this something you possibly plan to continue updating over the next few quarters?I guess My real question is: is there a huge domain of concentration and is that backlog proceeding to build and grow from the direct business style or, you know, the focus is on still-skilled production and more so on the UAM?I’m just looking to get a sense of what we’re thinking in terms of the backlog and what we’re looking for for 2024 and next year.
Thanks Andreas. It’s Adam. So we wanted to literally start highlighting the backlog to literally demonstrate that the company was ready for this next phase of starting to deliver aircraft. Once again, if we take a step back, we built a vehicle whose design was undeniable and which is certified. We have collaborated with leading aerospace suppliers to temporarily advance through the certification process. We are now working with the workplace to establish a production facility with the capacity to deliver significant volumes. So we are working on the demand side to literally meet those volumes and through our business style we have the ability to sell factories to help fund much of that journey. I think it’s literally vital that we start showing them where a lot of the demand is coming from. So obviously we’ve talked a lot about United over the last few years, but we’ve also stepped up conversations with new foreign partners as well as the world, adding Indigo’s parent company and also. like our UA partners in their Castle. What we literally seek to show is that we have confidence in the design. We are confident in the progress of certification. We are confident that we manufacture and build. And now we are beginning to create a call to fulfill all of this. Operator? Operator, can we move on to the next analyst?
Operator
Excuse me, can you hear me?
Yes.
Operator
Bill Peterson, JP Morgan.
Good morning, smart afternoon. I’m Mahima Kakani for Bill (various speakers). It appears that some systems, such as flight controls and environmental controls, are further along in the testing procedure. So I’m pretty curious about what’s pending in terms of Archer’s propulsion systems and whether it moves. Let’s move on to the Ford credit testing procedure you described.
Tom Muñiz
Yeah, hey, happy to answer that. Then you are right. You talked about certain flight control systems, environmental control systems, for which we already do compliance findings or the FAA does combined signatures. Other places. We are not so far. And that brings us back to where we are with our certification plans. So, although several of them have been accepted, several are still open. And to give you an example, we have a certification plan that talks about flight verification. And the explanation why it is not closed is because we are still waiting for the document to be released through the FDA. This affects how the entire industry will approach certain flight verification issues. That’s not to say that it might not happen, you know, that it might not happen or that it might not happen soon, but it’s not done right now. So we don’t do credit compliance studies in those spaces. That said, our goal is to complete the entire certification program in a truly effective manner. So we made a plan early on about the spaces we were looking to focus on first; you talked about the electric propulsion system. That’s where we’ve put a lot of effort with the FAA to make those plans literally transparent and move forward. But overall, I’m very pleased with the progress and the direction things are going.
It’s a very útil. Merci. Et color and then as a follow-up, can you comment on the day-to-day work department between your suppliers and Archer and work with the FAA to approve those compliant and non-compliant parts and other parts?de Vacon take care of it on behalf of Arch.
Tom Muñiz
Yes, that’s precisely the idea. So, there are two parts to consider. The first is the manufacture of the compatible parts that we want to use to carry out the tests. So instead of having to set up all of our own production lines to make things like flight computers, actuators or electronic components, hardware, etc. , we can leverage our suppliers’ infrastructure, capabilities, and expertise in each of those areas. But we go much further when it comes to certification, because we can collaborate with those corporations and leverage their technical and certification expertise to get the job done. So, he thinks of it much more as a combined team of Archer and all the experts from all of our selling partners, working collaboratively with the FDA to achieve that goal. Let’s hope it makes sense.
Operator
Thank you. David Zazula, Barclays.
It is ok. Thank you for attending to my inquiry. But maybe for Tom, if I can keep with Mahima. First consultation there. As far as open questions are concerned, there is still electric propulsion. For example, why do you think it’s still low-risk to continue traveling on a compatible aircraft?Yes, some parts of the certification and testing plant are still pending.
Tom Muñiz
Yes, that’s a wonderful question. So the way to think about it is, again, to take a step back and understand. From the beginning, I planned to use those six aircraft in a very specific way to download very quick knowledge to count and execute our workshop program. Each has express goals. And then the passes concentrate on express areas, like what formulas they want to fulfill or things like that. So what you’re seeing going forward with those first Tier 3 aircraft is that we have confidence in a lot of the designs, and we can go ahead and start doing that in the credits paintings that we highlighted in this post. Regarding our vision for electric propulsion and how we plan to move forward. We plan to have several TIA. Se this is a popular type inspection authorization, each corresponding to an express aircraft and in-flight verification objectives. Therefore, the ultrapropulsion formula and related facets are necessarily only one of the elements and one of the objectives of the overall flight verification certification plan.
Hey, David, this is Adam. Continuing here, it doesn’t stop just, you know, vendors are employing tier one vendors as the only component of the undeniable reduced threat certification plan, even under the new electric propulsion formula. I mean, we choose a formula that also has a lower load, for example, we choose cylindrical cells that decide on the pump cells and the cylindrical cells we have committed suppliers that we consider quite undeniable and sympathetic to the other ambitions of the government. We chose from the beginning to build an electric motor. It was very achievable. It offers many possible options for creating high-yielding portions that are much more difficult to certify. Then all possible options go back to this original strategy. And I think that deserves to be clear, looking at the chart that we have, which actually shows that we’re temporarily moving through the steps with the FAA. Again, it’s not that it’s easy, but we’re making significant progress and that’s largely due to the strategy we’ve had from the beginning. I think it will continue to pay off over the next 12 months.
Thank you Adam, thank you Tom. This is a useful color. If I may continue, it has recently received, yes, high-level staff from the FDA. I guess you can also percentage some of the feedback you’ve received. And then, in particular, to the increased attention they receive as high-level personnel, the CIO may lead to seek out Boeing because of the threat of occasions there. Do you think this can also have negative consequences in terms of your certification?Do you think about how important you think this is to your certification adventure in 24 and 25?Thank you.
Tom Muñiz
Yes absolutely. Some ideas about it. The first is that I perceive that from the beginning we chose to keep our design as undeniable as possible and not cross barriers and introduce new technologies or new production processes that are more risky, you know, 3D printing, etc. , anywhere. We did it. there’s no need. And I think that simplicity is really appreciated by the FDA because it makes their job less difficult for all of us. And the thought that comes to mind is that when this control team was here and in many interactions that I have had with the FA, I keep hearing how much they appreciate the suitability and the joy of our team. From time to time I get comments like: “Well, you’re not like a typical aerospace startup. You are a structured and serious team that is much more fun. And I think the reliability that comes from that is really valuable. For example, we recently did one of many software audits and the FAA expert’s comment was that it was one of the most productive audits he had ever seen, and he was very surprised that we had such high quality work coming from a new company. like ours. So I just have to congratulate our team because we have a very wonderful organization of people, whether it’s in-house painters and suppliers that I talked about earlier.
Hi David, here’s Adam. I’m just responding to comments about Boeing. No, we haven’t noticed anyone else getting rid of our task or slowing down their work. In fact, it has accelerated and reversed. And I was recently in Washington, D. C. , to meet with the new administrator. And it was very encouraging that, from a complex level, their mobility took a seat at the table with the manager among the major OEMs they’re building. And that’s why I think the concentrate is in space. And as a result, I think we’ve gotten a lot of attention in our circle of progress.
Operator
Thank you. Austin Moeller, Canaccord. Su line is now open. Austin, your line is now open. Alright, team, it’s like Austin has disconnected. Excuse me. (Operator’s Instructions)
Kate, we can call her.
Operator
Absolutely, this will conclude the Q&A session. Having said that, I will give the floor to Adam Goldstein to make some final remarks.
Thank you for joining today’s call. In addition to our entire team of workers and partners for their tireless execution, supporting our leadership position in the industry and helping to bring flying cars to market next year. I’m very proud of the strategy we’ve adopted since day one with the FAA. current suppliers, which has allowed us to get ahead of others in the industry and generally enter the final stages of the FAA certification procedure and I am equally excited about our effective strategy for capital power that has helped us gain a strong liquidity position as we are technical 2024. Thank you so much for taking the call.
Operator
This concludes today and thank you all for participating, you can now disconnect your lines.