German air taxi manufacturer Volocopter on Monday said it had filed for bankruptcy at the Karlsruhe District Court, days after one of its close competitors was saved from collapse.

However, the company said it was still seeking investors and planned to press ahead with its plan to enter the commercial air taxi market.

Why is Volocopter in trouble?

Volocopter, based near Stuttgart, still needs type certification from the European Union Aviation Safety Agency (EASA) for the market launch of its two-seater Volocity product line.

Although it has applied for insolvency proceedings, the company said it was proceeding on the assumption that an investor would be found in the new year.

In the meantime, it said the bankruptcy petition was necessary for it to stay afloat.

"Despite recent intensive fundraising efforts, finding a viable solution to maintain regular operations outside of insolvency proceedings has not been possible," Volocopter said.

"Business operations will continue as usual during the provisional insolvency proceedings."

The company said it was "nearing the finishing line" in gaining approval for the Volocity's all-electric vertical takeoff and landing technology. 

"The company needs financing to take the final steps towards market entry. We will endeavor to develop a restructuring concept by the end of February and implement it with investors," said court-appointed provisional insolvency administrator Tobias Wahl.

The company, founded in 2011, suffered a blow when it was forced to cancel test flights during the summer Olympic Games in Paris because the certificate for its aircraft engine did not arrive in time.

Volocopter said in December that that the Volocity model had fulfilled three-quarters of the EASA criteria required. The firm is working on a five-seater model, which it aims to unveil in 2027.

Competitor back from the brink

Last week, an investor was found to rescue the German electric plane pioneer Lilium from insolvency.

The Mobile Uplift Corporation consortium agreed to buy the startup, which has developed an eVTOL mini aircraft for the past decade.

Lilium's predicament fueled a debate in Germany about whether enough was being done to support startups. 

rc/wd (Reuters, AFP)