Archer Aviation (ACHR), the eVTOL air taxi company, is back in the spotlight after short seller Grizzly Research issued a report that questions the company’s future. The firm compared Archer to troubled truck start-up Nikola, calling the electric air taxi developer the “Nikola of the Skies.” The report points to weak orders, a quiet factory, and reliance on publicity rather than progress. Investors are now weighing whether the concerns hold weight.
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In the meantime, ACHR shares have had a tough year so far, dropping 11% year-to-date and more than 8% in the last five trading sessions.
Doubts About Aircraft and Orders
To begin, Grizzly argues that Archer’s Midnight aircraft is flawed and unlikely to be cleared for flight by regulators. The group says the design itself faces hurdles that cannot be fixed with minor changes. This sets a sharp contrast with Archer’s own message that certification is on track.
Next, the report raises questions about Archer’s order book, which the company values at $6 billion. Grizzly claims that many of the orders are linked to partners with weak financials or limited aviation experience. It notes that an order tied to Air Chateau is unlikely to be real, since the group has only ever bought one helicopter in the past.
Another order tied to Future Flight Global comes from a small firm with no track record. In addition, a deal with KakaoMobility in Korea has already fallen apart, yet it still shows up in the order pipeline. The research firm also points out that Archer often highlights its work with the U.S. Air Force, yet only a small part of the full contract has been awarded so far.
Factory Activity and Public Relations
Furthermore, Grizzly says that Archer’s Covington, Georgia, factory shows little sign of mass production. Investigators visited the site over the summer and reported empty lots and no sign of scaled output. Archer has stated that the site can support up to 650 aircraft per year, but Grizzly argues that this target is unrealistic.
At the same time, the report claims that Archer leans heavily on events and photos to shape its story. One example is the “Launch Edition” in Abu Dhabi. Grizzly says the aircraft shown was not new, but rather a reused unit meant for display. The firm states that Archer has even “delivered” the same aircraft more than once, raising questions about its disclosure.
In addition, Grizzly notes that rival Joby Aviation (JOBY) is making faster gains across certification and commercial prep. The firm suggests that Joby’s progress stands in contrast to Archer’s reliance on future promises. Still, Archer continues to promote its path toward both urban flight and defense. Grizzly frames the move into defense as a late attempt to shift focus, but investors will have to decide if that pivot has real depth.
Is Archer Aviation Stock a Good Buy?
Despite Grizzly’s research report, Wall Street analysts remain optimistic about the company. Based on seven recent ratings, Archer Aviation boasts a “Strong Buy” consensus with an average 12-month price target of $13.14. This implies a 52.44% upside from the current price.
Investor Takeaway
Overall, the Grizzly report paints Archer as a company with a glossy image but shaky fundamentals. Yet as with any short seller report, the claims reflect one view. Investors will likely watch how regulators, partners, and rivals move next. The market’s response will show whether Archer can push back on doubts or if concerns about its order book and aircraft hold ground.