Aerion Supersonic shuts down, ending plans to build silent high speed business jets

Business

Artist drawing of a supersonic jet designed to fly at speeds up to Mach 1.4 or approximately 1,000 miles per hour.
Aerion Corporation

Aerion Supersonic, the Nevada-based company that planned to build business jets capable of silently flying nearly twice as fast as commercial aircraft, is shutting down, the company confirmed to CNBC on Friday.

“In the current financial environment, it has proven hugely challenging to close on the scheduled and necessary large new capital requirements” to begin production of its AS2 supersonic jet, the company said in a statement.

“Aerion Corporation is now taking the appropriate steps in consideration of this ongoing financial environment,” the company said.

Florida Today first reported the company’s abrupt closure.

Aerion aimed to fly its first AS2 jet by 2024, with the goal of beginning commercial services by 2026. The company developed a patented technology it calls “boomless cruise,” which it said would allow AS2 to fly without creating a sonic boom – an issue that plagued the supersonic Concorde jets of the past.

The AS2 was priced at $120 million per jet. Aerion CEO Tom Vice said at a UBS conference in January 2020 that he expected it would cost the company about $4 billion to develop AS2, with $1 billion having been spent at the time to develop an engine.

The company had accrued multiple partnerships along the way – including with Boeing, General Electric, and Berkshire Hathaway-owned NetJets – and boasted an $11.2 billion sales backlog for its AS2 jets. Earlier this year Aerion, in press conference with Florida governor Ron DeSantis, unveiled it would build a $375 million manufacturing facility at the Orlando Melbourne International Airport.

An Aerion spokesperson did not respond to requests for comment on what will happen to Aerion’s assets.

Become a smarter investor with CNBC Pro.
Get stock picks, analyst calls, exclusive interviews and access to CNBC TV. 
Sign up to start a free trial today.

Articles You May Like

United Airlines pilots to get raises of more than 14%, 8 weeks of maternity leave in new contract
Top Wall Street analysts stand by these stocks as the first half of 2022 wraps up
Millennials want to retire early at 59. Here’s how to make that happen
44% of Americans work a side hustle to make ends meet — but it may not be an efficient way to earn more, says expert
Supreme Court’s overturning of Roe v. Wade expected to financially hurt the ‘most marginalized’ women, experts say