2025 hasn’t started on a good note for Saudi Crown Prince Mohammed bin Salman, as his $1.5 trillion Neom city faces fresh challenges. Avoiding gossip and speculation, we focus on facts, and it seems the ambitious dreams of the futuristic city, encompassing The Line, Trojena, and Oxagon, may be hitting turbulence even before takeoff. Neom’s air taxi partner, Volocopter, a German air taxi developer, has filed for insolvency, citing difficulties in securing fresh funding.
This news comes despite Volocopter having high-profile backers such as Mercedes-Benz, Honeywell, Daimler, Intel, and Mitsui Sumitomo Insurance Group. The only silver lining for Neom City is that Volocopter announced its operations would continue during insolvency proceedings as it seeks new investors.
Neom City is celebrated as a pioneering development with bold visions, including concepts like artificial moons, flying robots, and urban air mobility. Volocopter’s electric vertical take-off and landing (eVTOL) aircraft were a key component of these plans, aligning with Neom’s zero-emissions transport system and sustainability ethos. In 2022, Neom invested $175 million in Volocopter, naming it the sole operator for initial public transport routes across its flagship projects, including The Line, Oxagon, and Trojena.
“Numerous successful financing rounds have driven the company’s development and operations in the past,” the company’s insolvency announcement said. “With one of the lowest burn rates in the industry, Volocopter has successfully operated in an extremely difficult financial environment.”
Interestingly, Majid Mufti, CEO of the Neom Investment Fund, holds a seat on Volocopter’s advisory board, potentially providing a strategic advantage for Neom City. Volocopter stated it plans to finalize a restructuring concept by February 2025 and remains committed to launching its VoloCity craft later that year, pending certification from the European Union Aviation Safety Agency.
