Over the weekend the Washington Spectator published my essay, Diary of a Transit Miracle, recounting the arduous march of NYC congestion pricing from a gleam in a trio of prominent New Yorkers’ eyes at the end of the 1960s, to the verge of startup at the upcoming stroke of midnight June 30, the startup time announced by the MTA last Friday.
Landing page for this post’s original version.
I’m cross-posting it here — the third post on the subject in this space in the past 12 months (following this in December and this post last June) — because the advent of congestion pricing in the U.S. is “a really big deal,” as a number of friends and colleagues have told me in recent weeks. As my new essay makes clear, charging motorists to drive into the heart of Manhattan isn’t just a rejection of unconstrained motordom, it’s a new beachhead in “externality pricing” — social-cost surcharging — of which carbon taxes are the ultimate form.
The essay features two governors, two mayors — one of whom I served a half-century ago as a lowly but admiring data cruncher — a civic “Walter Cronkite,” a Nobel economist, raucous transit activists, a gridlock guru and yours truly, plus a cameo appearance by Robert Moses. It includes footage of the historic 1969 press conference in which Mayor John Lindsay and two distinguished associates enunciated the core idea of using externality pricing to better balance automobiles and mass transit that animated the arduous but ultimately triumphant congestion pricing campaign.
— C.K., April 29, 2024
Diary of a Transit Miracle
A miracle is coming to New York City. Beginning on July 1, and barring a last-minute hitch, motorists will soon pay a hefty $15 to enter the southern half of Manhattan — the area bounded by the Hudson River, the East River and 60th Street.
An anticipated 15 percent or so of drivers will switch to transit, unsnarling roads within the “congestion zone” and routes leading to it. The other 80 or 90 percent will grumble but continue driving. That is by design. The toll bounty, a billion dollars a year, will finance subway enhancements like station elevators and digital signals that will increase train throughput and lure more car trips onto trains.
The result will be faster, smoother commutes, especially for car drivers and taxicab and Uber passengers, who will pay a modest surcharge of $1.25 to $2.50 per trip. Drivers of for-hire vehicles will benefit as well, as lesser gridlock leads to more fares.1
The miracle is three-fold: Winners will vastly outnumber losers; New York will be made healthier, calmer and more prosperous; and that this salutary measure is happening at all, after a half-century of setbacks.
Obstacles to congestion pricing
Congestion pricing, as the policy is known, faced formidable obstacles even beyond the difficulty inherent in asking a group of people to start forking over a billion dollars a year for something that’s always been free.
Congestion pricing also had to contend with: an ingrained pro-motoring ideology that casts any restraint on driving as a betrayal of the American Dream; a general aversion to social-cost surcharges (what economists call “externality pricing”); exasperation over the region’s balkanized and convoluted toll and transit regimes; and, of late, a decline in social solidarity and appeals to the common good.
The advent of congestion pricing in New York is, thus, cause not just for celebration but wonderment. How did this wonky yet radical idea advance to the verge of enactment?
Origins
The trail begins in the waning days of 1969, when newly re-elected mayor John Lindsay recruited two well-regarded New Yorkers to devise a plan to fend off a 50 percent rise in subway and bus fares.
William Vickrey, a Canadian transplant teaching at Columbia and a future Nobel economics laureate, was a protean theorist of externality pricing. New York-bred mediator Theodore Kheel was admired as a civic Walter Cronkite for his plain-spoken common sense.
Lindsay, too often dismissed as a lightweight, understood mass transit as key to loosening automobiles’ spreading chokehold over the city. He had made combating air pollution a pillar of his first term and was fast becoming an exemplar of urban environmentalism. From his municipal engineers, Lindsay knew that technology to clean up tailpipes still lay in the future. A transit fare hike that would add yet more vehicles to city streets imperiled his clean-air agenda.
The triumvirate proposed a suite of motorist fees to preserve the fare. Their program ― higher registration fees and gasoline taxes, a parking garage tax, doubled tolls ― though mild in today’s terms, threatened powerful bureaucracies and their auto allies. Newly dethroned “master-builder” Robert Moses opined that Kheel, in his zeal to save the fare, had “gone berserk over bridge and tunnel tolls.”2 The program went nowhere.
L to R: Kheel, Lindsay, Vickrey. Click arrow to view (please excuse two brief garbled passages toward end).
Moses was right to be alarmed. From a City Hall podium on Dec. 16, 1969, Mayor Lindsay showcased Kheel’s and Vickrey’s respective reports, “A Balanced System of Transportation is a Must” and “A Transit Fare Increase is Costly Revenue.” (Click link in still photo above to view 27-minute video.) The trio propounded a new urban doctrine rebalancing automobiles and public transportation: “Automobiles are strangling our cities… Starving mass transit imposes costs that are difficult to measure, yet real… Correcting the fiscal imbalance between transit and the automobile is key to enhancing our environment and quality of life…”
Their remarks set generations of urbanists on course toward congestion pricing.
Setbacks
Quantifying those precepts became my research agenda 40 years later. In the interim, two creditable attempts to enact congestion pricing crashed and burned.
The central element of Lindsay’s 1973 “transportation control plan” was tolls on the city’s East River bridges, a measure designed to eliminate enough traffic to satisfy federal clean-air standards. Though the plan’s formal demise didn’t come until 1977, in legislation written by liberal lawmakers from Brooklyn and Queens, the toll idea never stood a chance. Electronic tolling was 20 years away, and adding stop-and-go toll booths seemed more likely to compound vehicular exhaust than to cut it.
Three decades later, in 2007, Mayor Michael Bloomberg asked Albany to toll not just the same East River bridges but also the more-trafficked 60th Street “portal” to mid-Manhattan. Predictably, faux-populist legislators saw Bloomberg’s billionaire wealth as an invitation to denounce the congestion fee as an affront to the little guy.
The mayor may have hurt his cause by presenting congestion pricing primarily as a climate and pollution measure. The pollution rationale was no longer compelling in the way it had been in Lindsay’s day, as automotive engineers had slashed rates of toxic vehicle exhaust ten-fold. Appeals tied to global warming also fell flat; remember, congestion pricing contemplated that most drivers would stay in their fossil-fuel burning cars.
This isn’t to say that congestion pricing confers no climate benefits. Rather, the benefits are subtler ones that can be hard to convey to voters, such as making climate-friendly urban living more attractive. A further benefit may come as congestion pricing demonstrates the unique power of externality pricing, as explained below.
From the Rubble
Even as Bloomberg’s toll plan was faltering in Albany, new loci of support were germinating in the city.
Changing times demanded not just the intellectual leadership of think-tanks like the Regional Plan Association and the good-government Straphangers Campaign, but gritty, grassroots transit organizing. Enter the newly-minted Riders Alliance.
2017 subway handbill exemplified new militancy targeting Gov. Andrew Cuomo for failing transit.
As subway service began cratering in 2015, the inevitable result of budget-raiding by a skein of governors, the Alliance posted crowd-sourced photos of stalled trains and jammed platforms alongside demands for improved service from “#CuomosMTA.” Before long, the papers were pointing the finger at the governor not just in “Why Your Commute Is Bad” explainers but in tear-jerkers like the Times’ May 2017 classic, “Money Out of Your Pocket”: New Yorkers Tell of Subway Delay Woes.
The drumbeat was deafening. Cuomo finally blinked. On a Sunday in August 2017, he phoned the Times’ Albany bureau chief and handed him a scoop for the next day’s front page: Cuomo Calls Manhattan Traffic Plan an Idea ‘Whose Time Has Come’.
The “traffic plan” was congestion pricing.
Data Cruncher
Two months later, Cuomo’s staff summoned me to the midtown office of the consulting firm they had retained to “scope” congestion pricing ― essentially, to compute how much revenue tolls could generate. They wanted to see if an Excel spreadsheet model I had constructed and refined over the prior decade could aid their scoping process.
The model was called the Balanced Transportation Analyzer, a name bestowed in 2007 by Ted Kheel.
Ted, in his nineties, had recruited me to determine whether a large enough congestion toll could pay to make city transit free. The idea worked on paper but foundered politically. Nevertheless, Ted saw in my Excel modeling a way to capture phenomena like “rebound effects” (motorists driving more as road space frees up) and “mode switching” between cars, trains, buses and taxicabs, that he and Prof. Vickrey had identified in their 1969 work but lacked the computing ability to quantify.
Ted’s philanthropy enabled me over the next decade to expand, test and update my transportation modeling. With a hundred “tabs” and 160,000 equations, the “BTA” can instantly answer almost any conceivable question about New York congestion pricing, as well as these two central ones: how much revenue it will yield, and how much time will travelers save in lightened traffic and better transit.3
The BTA model aced its 2017 audition and became the computational engine for the congestion pricing legislation the governor’s team enacted into law in 2019. Its impact has been even broader.4 “Having the model helped make the case with the public, journalists, elected officials and others,” Eric McClure, director of the livable-streets advocacy group StreetsPAC, wrote recently, in part by helping congestion pricing proponents push back on opponents’ exaggerated claims of disastrous outcomes and their incessant demands for special treatment. The model may also have influenced the detailed toll design adopted by the MTA board earlier this year, which hewed close to the toll design I had recommended last summer.5
The BTA also provided sustenance during congestion pricing’s seven lean years ― the 2009-2016 period in which the torch was kept lit by a new triumvirate known as “Move NY” ― traffic guru “Gridlock” Sam Schwartz, the very able campaign strategist Alex Matthiessen, and myself. The model helped our team evangelize congestion pricing’s transformative benefits to elected officials and the public. This, I believe, was a key element in mustering the critical mass of support that ultimately swayed not one but two governors.
The Hochul Factor
New York Lieutenant Governor Kathy Hochul’s ascension to governor in August 2021 could have been congestion pricing’s death knell. The toll plan was adrift in the federal bureaucracy, and its latter-day champion Andrew Cuomo had exited in “me-too” disgrace. His successor, from distant Buffalo, wasn’t beholden to New York or congestion pricing.
Hochul, who as governor controls city and regional transit, could have disowned congestion pricing as convoluted, bureaucratic and tainted. Instead, she became a resolute and enthusiastic backer. Her spirited support, both in public and behind the scenes, became the decisive ingredient in shepherding congestion pricing to safety.
Why the new governor went all-in on congestion pricing awaits a future journalist or historian. Had she spurned it, the opprobrium from downstate transit advocates would have been intense; but there doubtless would have been cries of “good riddance” as well. Vickrey, Kheel and Riders Alliance notwithstanding, it’s not clear how closely New Yorkers — including transit users — connect congestion tolls to improved travel and a better city.
What makes Hochul’s embrace especially impressive is that congestion pricing is, in a real sense, an attack on a jealously guarded entitlement: the right to inconvenience others by usurping public space for one’s vehicle. The classic lament about entitlements’ iron grip is that “losers cry louder than winners sing.”6 Yet in this case, it seems, potential losers — actual and aspiring zone-bound drivers — are being out-sung by transit interests seeking, in Kheel’s 1969 words, a better balance between public transportation and automobiles.
Credits and Prospects
Let us now praise Andrew Cuomo’s crafting of the legislation that teed up congestion pricing’s successful run.
Rather than specifying a dollar price for the tolls, or a precise traffic reduction, his 2019 bill established a revenue target: sufficient earnings to bond $15 billion in transit investment — which equates to $1 billion a year to cover debt service. This device trained the public’s focus on the gain from congestion pricing (better transit) instead of the pain (the toll). Equally important, with this deft stroke, any toll exemption that a vocal minority might seek would mathematically trigger higher tolls for everyone else. The effect was vastly heightened scrutiny of requests for carve-outs.
Which cities will follow on New York’s heels? No U.S. urban area comes close to our trifecta of gridlock, transit and wealth. Sprawling Los Angeles or Houston, or even Chicago for that matter, might be better served by more granulated traffic tolls than New York’s all-or-none model.
Perhaps Asia’s megalopolises will be swept up in our wake. In the meantime, my focus will be on the holy grail of externality pricing: taxing carbon emissions. Every economist knows that the surest and fastest way to cut down on a “bad” is by taxing it rather than subsidizing possible alternatives. Yet that approach remains counter-intuitive and even anathema to nearly everyone else.
A huge and important legacy that New York congestion pricing could provide is to prove that intelligently taxing societal harms need not be electoral suicide. This proof could help unlock a treasure-trove of prosperity-enhancing pricing reforms including, most prominently, robust carbon taxing.
The author, a policy analyst based in New York City, worked in Mayor Lindsay’s Environmental Protection Administration in 1972-1974. He met Bill Vickrey in 1991 and worked closely with Ted Kheel from 2007 to 2010.
Endnotes
- The new passenger surcharges of $1.25 for taxicabs and $2.50 for “ride-hails” (principally Ubers) apply to trips touching the congestion zone. These will be partially offset by lower fares owing to shorter wait-time charges due to faster travel speeds.
- Quote is from Moses’ August 23, 1969 guest essay in Newsday, “Is Rubber to Pay for Rails?” (not digitally available).
- The current version of the BTA is publicly available at this link: (18 MB Excel file).
- See Fix NYC Advisory Panel Report, Appendix B, 2019.
- A Congestion Toll New York Can Live With, July 2023, by Charles Komanoff, co-authored with Columbia Business School economist Gernot Wagner.
- As pronounced by University of Michigan economist Joel Slemrod, in Goodbye, My Sweet Deduction, New York Times, by Eduardo Porter and David Leonhardt, Nov. 3, 2005.
The voluntary carbon market is booming in 2025. Allied Offsets data showed that in the first quarter of 2025, around 780,000 CDR credits were contracted — a surge of 122% compared to the same period in 2024.
Additionally, 16 million credits were sold in the first six months of 2025 – marking it the strongest start to a year so far. The momentum is fueled by major buyers like Microsoft, aiming to be carbon negative by 2030, and by a surge in biomass-based removal methods that are reshaping corporate offset strategies.
Why Carbon Dioxide Removal Credits Are Surging
Businesses are racing to hit climate targets faster, and carbon dioxide removal (CDR) is emerging as the go-to solution. The biggest boost this year comes from biomass-based methods — like turning farming and forestry waste into tools for trapping CO₂. These projects are cheaper, easier to scale, and more accessible than high-cost tech such as direct air capture (DAC).
By early 2025, biomass CDR accounted for about 40% of credit volumes. Microsoft and other big players are securing large volumes, setting quality benchmarks, and pushing the market toward transparent, high-integrity projects.
Source: Zion Market Research
Technology Shifts in CDR
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Biomass-based CDR — including BECCS, biochar, bio-oil, and biomass burial — made up a massive 94% of total volumes in the first half of 2025.
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Investment focus, however, is still heavily skewed toward DAC and carbon utilization projects, despite other scalable and cost-effective CDR options.
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More public awareness and funding diversity are needed to unlock the full potential of multiple CDR pathways.
New innovations are also redefining CDR. About 30% of new projects now use methods such as advanced soil carbon storage, bio-oil injection, and marine carbon removal, which can store CO₂ for hundreds or even thousands of years.
Digital MRV platforms are also transforming the space, offering real-time tracking to boost transparency, prevent fraud, and speed up purchase decisions. Meanwhile, integrated projects like agroforestry, regenerative agriculture, and biodiversity restoration are gaining traction for their multi-benefit environmental impact.
Environmental Benefits of Biomass CDR
Biomass approaches like biochar and BECCS offer cost-effective solutions, often ranging from $80–$200 per ton.
These methods work within a circular economy model — repurposing agricultural and forestry waste into long-term carbon storage. BECCS delivers a dual benefit by producing renewable energy while storing CO₂ underground.
However, without strict MRV protocols, poorly managed biomass projects risk deforestation or biodiversity loss. Global removal capacity is still only 41 million tons CO₂/year, yet it needs to grow 25–100x by 2030 to meet climate goals.
Market Segmentation
By technology: DAC, afforestation & reforestation, soil carbon sequestration, BECCS, ocean-based CDR, and enhanced weathering.
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DAC, holding 67% of global revenue in 2023, is set for the fastest growth thanks to flexible deployment and industrial CO₂ utilization.
By application: Consumer products, energy, transport, and industrial sectors.
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The industrial sector leads due to rising emissions from cement, steel, and chemicals.
CDR Buyer Trends in 2025
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Financial services firms led in the number of unique buyers, while technology companies dominated purchase volumes with over 50 million credits bought so far.
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Half of all buyers in early 2025 were first-time participants, collectively purchasing around 6 million credits which is a promising sign of market expansion.
Market Momentum and Future Projections
The CDR market hit $3.9 billion in Q2 2025, with biomass projects making up 99% of transactions. Microsoft continues to drive momentum by locking in long-term purchase agreements that help projects scale.
Market forecasts suggest CDR’s value will grow from $842 million in 2025 to $2.85 billion by 2034, while durable carbon credits could soar to $14 billion by 2035, growing 38% annually.
Rising buyer expectations — around permanence, transparency, and quality — are further reinforced by new regulations, particularly in Europe, pushing out low-integrity credits.
Opportunities and Challenges Ahead
The CDR market stands to benefit from government-backed carbon incentives, increasing demand for carbon credits, and the potential to create new jobs in sectors such as farming, engineering, and construction. However, its growth faces hurdles, including limited public awareness of CDR’s advantages and the risk of political instability slowing adoption.
What’s Next for Carbon Dioxide Removal?
The market is at a turning point. Experts predict a blend of nature-based and durable removals, with the latter gaining ground toward 2050 as quality demands rise. The future will rely on smarter investments, high-fidelity data tracking, and clear global standards.
Corporate leaders like Microsoft are already showing the way — proving that transparency, permanence, and innovation will define the next era of climate action.
- READ MORE: MOL Becomes the First Japanese Shipping Firm to Retire Tech-Based CDR Credits Through NextGen
The post CDR Credit Sales Hit Record High, Powering Market Growth in 2025 appeared first on Carbon Credits.
Carbon Footprint
Toyota’s (TM Stock) Q1 Twist: Why Profits Dip But Hybrids Surge, and Net Zero Goals Accelerate
Toyota Motor Corporation reported a sharp drop in earnings for the quarter ending June 30, 2025. Net profit fell 37% to ¥841 billion ($5.7 billion), down from ¥1.33 trillion a year earlier. This marked one of the steepest quarterly declines in recent years. Revenue, however, rose 3% year-over-year to ¥12 trillion ($82 billion), supported by strong demand in North America and Asia.
The primary drag came from new U.S. tariffs of 15% on Japanese car imports, which reduced profit by an estimated ¥450 billion. Higher costs for raw materials and a stronger yen hurt overseas earnings. Global inflation also impacted the results.
Toyota has revised its full-year operating profit forecast downward to ¥2.66 trillion ($18 billion). This speaks of a more cautious outlook for 2025. Analysts say the biggest automaker is keeping strong sales. However, profit margins face pressure from outside economic factors.
Amid the financial hiccup, the company reaffirmed its commitment to climate leadership. It aims for carbon neutrality with strong emissions targets, green manufacturing projects, and renewable energy investments. This effort is part of its Environmental Challenge 2050 framework.
Hybrids Take the Wheel as Sales Defy the Downturn
Global vehicle sales for the quarter reached 2.4 million units, up from 2.2 million a year ago. Toyota’s sales in North America rose nearly 20% in July. This boost came from its hybrid models, like the RAV4 Hybrid and Camry Hybrid, which both showed double-digit growth.
Hybrid and plug-in hybrid models make up over one-third of Toyota’s total sales. This shows how important electrified powertrains are becoming in the company’s lineup.
Battery electric vehicle (BEV) sales, while still a smaller portion, increased steadily in markets with expanding charging infrastructure.
Toyota stayed on top in Japan and Southeast Asia. This was thanks to its compact cars and commercial vehicles. However, European sales dipped a bit due to tougher emissions rules and strong competition from local EV brands.
Toyota’s share price fell about 1.6% following the earnings announcement, as tariff concerns weighed on investor sentiment. Even with this dip, the stock still looks good. Its forward price-to-earnings (P/E) ratio is 6.9. That’s lower than the industry average of 8.0 and Toyota’s five-year average of 9.3.
Driving Toward 2050: Toyota’s Net Zero Roadmap
Toyota has set a long-term target to achieve carbon neutrality across the entire life cycle of its vehicles by 2050. This goal covers emissions from all stages: vehicle design, production, use, and recycling. It also includes emissions from suppliers and logistics partners.
In its latest sustainability report, Toyota reported its Scope 1 and Scope 2 greenhouse gas emissions. These emissions, from direct operations and purchased electricity, reached around 2.05 million metric tons of CO₂e in FY 2024. This shows a 15% drop from FY 2019 levels. The company aims to cut these emissions by 68% by 2035, using 2019 as the baseline year.
For Scope 3 emissions, which account for most of Toyota’s footprint, targets are set. By 2030, Toyota aims for a 30% reduction from suppliers, logistics, and dealerships. They also seek a 35% cut in average vehicle-use emissions. These goals account for the fact that tailpipe emissions from vehicles remain the single largest part of the company’s climate impact.
Globally, Toyota is investing in solar, wind, hydrogen, and renewable natural gas to power its factories. It has also joined multiple international coalitions to accelerate low-carbon manufacturing and logistics.
The largest carmaker is investing a lot in renewable energy. They plan to use 45% renewable electricity in North America by 2026. By 2035, they aim for 100% renewable energy at all global plants.
Projects include:
- Large-scale solar panel installations at assembly plants
- Hydrogen-powered forklifts
- Renewable natural gas systems at engine facilities.
The company’s approach combines electrification with manufacturing decarbonization. This includes hybrids, battery electric vehicles (BEVs), and hydrogen fuel cell vehicles.
Toyota’s leaders think this multi-pathway strategy will reduce emissions quickly. This is especially true in areas where full BEV infrastructure is still growing. It also helps ensure steady progress toward the company’s 2050 carbon neutrality goal.
In summary, the company’s near-term reduction targets are:
- 68% reduction in Scope 1 and 2 emissions by 2035 (compared to 2019 levels).
- 30% cut in Scope 3 emissions from suppliers, logistics, and dealerships by 2030.
- Matching 45% of electricity use with renewables in North America by 2026.
Environmental Challenge 2050: Six Pillars of Action
Toyota’s Environmental Challenge 2050, launched in 2015, remains its guiding framework for sustainability. The initiative is built on six core challenges:
- Zero CO₂ emissions from new vehicles through hybrid, BEV, and hydrogen fuel cell adoption.
- Zero CO₂ emissions in manufacturing by shifting to renewable energy and low-carbon processes.
- Life cycle zero CO₂ emissions, including recycling and parts reuse.
- Minimizing water usage and improving water discharge quality.
- Protecting biodiversity around manufacturing sites and supply chains.
- Advancing a circular economy by extending product lifecycles and reducing waste.
Toyota aims to sell 1.5 million BEVs annually by 2026 and 3.5 million by 2030, alongside continuing hybrid and fuel cell development. This multi-path approach allows the company to meet varying customer needs and infrastructure readiness levels worldwide.
Green Manufacturing: Major Investments in Low-Carbon Plants and ESG
Toyota’s largest new sustainability investment is a ¥140 billion ($922 million) advanced paint facility in Georgetown, Kentucky. Set to open in 2027, the plant will reduce paint shop carbon emissions by 30% and cut water use by 1.5 million gallons annually.
In Japan, Toyota is piloting hydrogen-powered forklifts and solar-powered assembly lines. The company will use 100% renewable electricity for its manufacturing in Europe by 2030.
These projects reduce environmental impact and boost operational efficiency. They support Toyota’s goals of sustainability and profitability.
Beyond emissions, Toyota is strengthening its broader ESG performance. The company has strict human rights rules for suppliers. These rules include labor conditions, conflict minerals, and environmental compliance. By 2030, Toyota aims for 90% of its top suppliers to set their own science-based emissions targets.
In 2024, Toyota diverted 94% of waste from landfills globally and recycled over 99% of scrap metal from manufacturing. It also invested in reforestation projects in Asia and Africa as part of its carbon offset strategy.
Balancing Short-Term Pressures With Long-Term Goals
The April–June quarter highlighted Toyota’s resilience in the face of macroeconomic challenges. Tariffs and currency changes have hurt short-term profits. However, strong vehicle sales, especially in hybrids, keep the company competitive.
At the same time, Toyota is moving ahead with one of the most thorough sustainability programs in the auto industry. Its carbon neutrality goals and the Environmental Challenge 2050 framework guide its actions. Also, large-scale green manufacturing investments help meet the growing demands for cleaner mobility from regulators and consumers.
As Toyota navigates market volatility, its ability to deliver both financial and environmental strategies will be key to maintaining global leadership in the shift toward sustainable transportation.
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Carbon Footprint
JOBY Aviation Stock Soars on Blade Acquisition and Electric Air Taxi Commercial Launch Plans
Joby Aviation Inc. (NYSE: JOBY) is closing in on its dream of launching electric air taxis. The California-based company has spent years building its all-electric, vertical take-off and landing (eVTOL) aircraft, designed for fast, quiet, and convenient city travel.
Air Taxis: The Future of Fast, Clean, and Congestion-Free Urban Travel
Air taxis are small electric or hybrid aircraft that take off and land vertically, ideal for short city hops, airport transfers, and reaching remote areas. Target users include executives, business travelers, and emergency services. Countries like the U.S., Germany, and the UAE are investing heavily in supporting infrastructure.
A report highlighted that the global air taxi market, valued at USD 1.32 billion in 2024, is projected to hit USD 7.74 billion by 2033 at a 21.72% CAGR, driven by eVTOL technology, urban mobility demand, and congestion-free travel needs.
Growth is fueled by advances in batteries, lightweight materials, and electric propulsion, making aircraft cleaner and more efficient, plus worsening city traffic that air taxis can bypass—cutting multi-hour trips to just 15–20 minutes.
This August, Joby made a series of bold moves that pushed it closer to commercial operations, from a high-profile acquisition and defense partnership to major FAA progress and manufacturing growth. Investors noticed, sending the stock near record highs.
Blade Deal Unlocks Instant Market Access and Growth
One of the month’s biggest headlines came on August 4, when Joby announced plans to acquire Blade Air Mobility’s passenger business for up to $125 million in cash or stock.
The deal is a game-changer. Blade brings premium infrastructure, including dedicated terminals at major New York airports and a strong presence in Southern Europe. More importantly, it comes with a loyal customer base — more than 50,000 passengers flew Blade in 2024.
By absorbing Blade’s passenger operations, Joby gains instant market access without the time and expense of building from scratch. The acquisition is expected to slash infrastructure costs, speed up customer acquisition, and put Joby ahead of competitors in key urban corridors.
The transaction is set to close in the coming weeks, pending customary approvals. Once complete, Blade’s passenger services will continue under Joby’s ownership, setting the stage for a smooth integration.
- READ MORE: Boosting Aviation Carbon Credits: ICAO Greenlights Verra’s VCS Program for CORSIA Carbon Market
Defense Partnership Opens a New Revenue Stream
Joby revealed another major move, a collaboration with defense contractor L3Harris.
The partnership will develop a gas turbine hybrid variant of Joby’s existing eVTOL aircraft for low-altitude defense missions. The design aims to combine Joby’s manufacturing expertise with L3Harris’ deep defense technology capabilities.
Flight testing is set to begin this fall, with operational demonstrations planned during government exercises in 2026.
This venture signals Joby’s ambition to be more than just a commercial passenger service. By stepping into the defense sector, Joby diversifies its revenue streams and showcases its aircraft’s versatility for both civilian and military use.
FAA Certification Moves Into Final Stages
On August 6, Joby shared a crucial regulatory update. It has started final assembly of its first FAA-approved electric air taxi, a major step toward Type Inspection Authorization (TIA) flight testing. This stage needs FAA-approved test plans, a certified design, and proven manufacturing — all of which Joby has achieved, with over 50% of its test plans already accepted.
The aircraft, developed over years of testing, will fly with Joby pilots in 2025, followed by FAA pilots. Structural and systems tests have confirmed its strength and readiness.
Joby’s in-house design and manufacturing have boosted development and improved quality. With new facilities in California and Ohio, backed by Toyota, the company will soon be able to build up to 24 aircraft a year.
Cash-Rich and Backed by Toyota, Joby Eyes Massive Growth Ahead
- Joby’s balance sheet is strong, ending Q2 2025 with $991 million in cash, cash equivalents, and marketable securities.
The company also closed the first $250 million tranche of a $500 million strategic investment from Toyota, one of Joby’s largest and most influential partners.
For 2025, Joby expects to use between $500 million and $540 million in cash, excluding the Blade acquisition. Revenue remains small, just $59,600 expected for Q2, but growth projections are huge, with a forecasted 900% year-on-year increase from a low base.
JoeBen Bevirt, founder and CEO of Joby, said,
“This is a pivotal moment. Regulatory progress around the world is unlocking market access, our commercialization strategy is taking hold, and we’re now focused on scaling production to meet real demand—a challenge we’re fully committed to and working hard to deliver on.”
JOBY Stock Surge Reflects Growing Investor Confidence
Joby’s recent string of announcements sent its stock soaring. In the past month alone, shares have jumped more than 70% due to heavy trading. Year-to-date, the stock has risen 142%, surpassing its market capitalization of $14 billion.
However, volatility remains. Analyst price target changes and insider sales have caused swings, but the long-term outlook hinges more on regulatory milestones than short-term earnings.
Manufacturing Expansion Doubles Output
To meet growing demand, Joby expanded its Marina, California, manufacturing facility to 435,000 square feet. This upgrade will double production capacity to 24 aircraft per year.
Meanwhile, its newly renovated Dayton, Ohio, site is ramping up to produce and test key aircraft components. Over time, Dayton could scale to build up to 500 aircraft annually, making it a cornerstone of Joby’s manufacturing strategy.
International Partnerships Boost Global Reach
Joby is not just looking at U.S. cities. The company also announced an expanded partnership with ANA Holdings in Japan.
The two companies plan to deploy over 100 Joby air taxis starting in Tokyo, creating an urban air mobility ecosystem complete with dedicated vertiports and operational support. The partnership will leverage Toyota’s network and government cooperation to fast-track development.
Joby also signed new agreements with Abdul Latif Jameel and ANA to explore deploying approximately 300 aircraft in other markets.
What’s Next for Joby Aviation?
With the Blade acquisition, defense partnership, FAA certification progress, and global expansion, Joby is executing on multiple fronts at once.
The next 12 months will be critical. If Joby completes certification on schedule, ramps production, and integrates Blade’s passenger network, it could be one of the first eVTOL companies to operate at scale.
For now, investors are betting big that Joby’s head start, strategic partnerships, and strong balance sheet will translate into a dominant position in the fast-emerging air taxi market.
Joby Aviation isn’t just inching toward launch; it’s accelerating. From New York to Dubai to Tokyo, the pieces are falling into place for a global eVTOL network. If all goes according to plan, 2026 could be the year flying taxis move from concept to reality.
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Climate Change2 years ago
Spanish-language misinformation on renewable energy spreads online, report shows
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