ARC Aerosystems, a UK-based advanced air mobility developer, is making headlines with its strategic decision to sell its C600 vertical take-off and landing (VTOL) cargo drone program. This move signifies a pivotal shift in the company’s focus towards the development and certification of a new generation of crewed gyroplanes, specifically the Pegasus III and Linx programs. Here’s a deep dive into the reasons behind this decision, the potential benefits, and what it means for the future of ARC Aerosystems.
Why the C600 is on the Chopping Block
The primary driver behind ARC Aerosystems’ decision to sell the C600 program is to strategically allocate resources towards its crewed aircraft ventures. By divesting the cargo drone program, ARC aims to raise up to £20 million ($25 million). This capital injection will be instrumental in accelerating the development and bringing the Pegasus III gyroplane to market by 2027.
Funding Future Ambitions
ARC Aerosystems is also aiming to secure £70 million over the next five years to facilitate the entry into service of the larger Linx P9 by 2029. This ambitious fundraising plan underscores the company’s commitment to establishing a strong presence in the crewed aircraft market.
Streamlining Operations
The sale of the C600 program allows ARC Aerosystems to streamline its operations and concentrate its expertise on gyroplane technology. This focused approach is expected to enhance efficiency and accelerate the development process, ultimately leading to faster time-to-market for its crewed aircraft.
What is the C600?
The C600 is a heavy-lift cargo drone designed for vertical take-off and landing. Prototypes have been rigorously tested since 2018, demonstrating full transitions from vertical to wing-borne flight and trials in real-world operating environments.
C600 Specifications
- Payload: Up to 150 kg (330 lbs)
- Range: Up to 644 km (400 miles) with the hybrid-electric model
- Speed: Cruise speed of 120 km/h (74.5 mph), maximum speed of 150 km/h (93 mph)
- Configuration: VTOL with 8 vertical lift propellers and 1 pusher propeller
- Power: Hybrid-electric or all-electric options
- Applications: Air cargo, logistics, medical air services, humanitarian aid
Advanced Testing and Development
The C600 has undergone extensive testing, including trials in the north of Scotland as part of the UK government-backed Future Flight Challenge (FFC). ARC Aerosystems reports that the C600 has reached a technology readiness level (TRL) of 7 and a manufacturing readiness level of 4.
The Future is Gyroplanes: Pegasus III and Linx
ARC Aerosystems is betting big on the future of gyroplane technology with its Pegasus III and Linx programs. These aircraft represent the company’s vision for advanced air mobility, offering unique capabilities and potential applications.
Pegasus III: The Immediate Focus
The Pegasus III is a gyroplane designed for versatility and efficiency. Its key features include:
- Low operating cost: Making it an economically attractive option
- Long range/endurance: Suitable for a variety of missions
- Jump take-off: Allowing for operations from confined spaces
- No-roll landing: Enhancing safety and operational flexibility
ARC Aerosystems plans to start accepting deposit-backed orders for the Pegasus III next year, with a target market entry in 2027.
Linx P9: The Long-Term Vision
The Linx P9 is a larger, nine-seat compound rotorcraft designed for passenger transport. Key specifications include:
- Hybrid Engine: Greater efficiency and range
- Cruise speed: (@75% 7,000 ft) 300km/h
- Max range (10 min reserve): 180km
- Jump Take-off: Vertical takeoff capability
ARC Aerosystems anticipates the Linx P9 entering service by 2029, contingent on securing the necessary funding.
The Financial Implications
ARC Aerosystems hopes to raise up to £20 million ($25 million) from the C600 sale. If the company only raises £6 million, they may pursue C600 production in the UK with a separate management team.
Investment and Valuation
ARC Aerosystems has already invested £10 million in the C600 program, including £1.7 million from FFC projects and a £3 million convertible loan from the British Business Bank. Investment firm Turquoise International conducted an independent valuation of the program, factoring in future cash-flow forecasts.
Revenue Projections
Forecasts prepared for the sale suggest the C600 program could generate revenues of up to £33 million by the end of the decade, driven by the growing market for drone transport services.
What’s Included in the Sale?
The sale of the C600 program includes a comprehensive package of assets:
- Prototypes: Multiple prototypes of the C600 aircraft
- Control systems: The technology and software necessary to operate the drones
- Spare parts: Ensuring ongoing maintenance and support
- Intangible assets: Flight-test reports, design manuals, safety cases, and research data
LandOn Aeronautics
ARC Aerosystems has established a German-registered business, LandOn Aeronautics, to hold the C600 program. The employees of LandOn will transfer to the new buyer, ensuring continuity and expertise.
Ongoing Support
ARC Aerosystems’ senior team will provide advisory roles to support the buyer through the production phase. The technology and production for the C600 could remain in the UK if required by the buyer.
The Broader Context
ARC Aerosystems’ decision to focus on crewed gyroplanes reflects a broader trend in the advanced air mobility market. While cargo drones offer significant potential for logistics and delivery services, the market for passenger-carrying VTOL aircraft is expected to grow substantially in the coming years.
Strategic Partnerships
ARC Aerosystems has established strategic partnerships to support its growth and development. A deal with Saudi-based Life Shield is expected to bring upwards of £300m of investment into the aerospace sectors of the UK and Saudi Arabia. This partnership includes the creation of Life Shield Aerospace, which will manufacture ARC’s designs in Saudi Arabia for domestic use and export.
A Bold Vision for the Future
ARC Aerosystems’ decision to sell its C600 cargo drone program is a bold move that underscores its commitment to crewed gyroplane technology. By focusing its resources on the Pegasus III and Linx programs, the company aims to establish a leading position in the advanced air mobility market. With its innovative designs, strategic partnerships, and clear vision for the future, ARC Aerosystems is poised to shape the future of air transportation.
