Financial feasibility studies of eVTOL aircraft production project of PT XYZ
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Abstract
The growth of Transportation in Indonesia especially in cities led to increased destination time and traffic jams. As one of the solutions air taxis using electric Vertical Take-Off Landing (eVTOL) is advised. As a country capable of producing aircraft, PT XYZ seizes the chance to invest in the production of eVTOL in Indonesia. PT XYZ planned this project from 2024 to 2035 with an initial investment of $327,292,103.88 (USD). From 2024 to 2028 planned to expand its capital and from 2029 to 2035 PT XYZ planned to sell eVTOL aircraft in the domestic markets and international markets. Based on the financial projection of PT XYZ plan, this project is financially feasible because of a positive Net Present Value (NPV) of $209,542,512.94 and an Internal Rate of Return of 26.98%. This project has a payback period of 8 years and a profitability index of 1.49. Using the sensitivity analysis and Monte Carlo Simulation, the costs of goods sold and aircraft prices of this project affect the project’s NPV with an 80% chance of positive NPV
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How to Cite
Senggoro A, H., & Oktofa S, Y. (2024). Financial feasibility studies of eVTOL aircraft production project of PT XYZ . Enrichment : Journal of Management, 14(3), 407-414. https://doi.org/10.35335/enrichment.v14i3.1953
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Bowen, D. J., Kreuter, M., Spring, B., Cofta-Woerpel, L., Linnan, L., Weiner, D., Bakken, S., Kaplan, C. P., Squiers, L., Fabrizio, C., & Fernandez, M. (2009). How We Design Feasibility Studies. American Journal of Preventive Medicine, 36(5), 452–457. https://doi.org/10.1016/j.amepre.2009.02.002
Duca, G., Trincone, B., Dziugiel, B., Liberacki, A., Russo, R., Sangermano, V., & Witkowska-Konieczny, A. (2023). Urban Air Mobility in the next future: main findings from a technical survey. Transportation Research Procedia, 72(2022), 965–972. https://doi.org/10.1016/j.trpro.2023.11.524
Garrow, L. A., German, B. J., & Leonard, C. E. (2021). Urban air mobility: A comprehensive review and comparative analysis with autonomous and electric ground transportation for informing future research. Transportation Research Part C: Emerging Technologies, 132(September), 103377. https://doi.org/10.1016/j.trc.2021.103377
Gibson, W., & Morrell, P. (2004). Theory and practice in aircraft financial evaluation. Journal of Air Transport Management, 10(6), 427–433. https://doi.org/10.1016/j.jairtraman.2004.07.002
Gitman, L., Smart, S. B., & Zutter, C. J. (2018). Principles of Managerial Finance (18th ed.). Pearson.
Graaskamp, J. A. (1972). A rational approach to feasibility analysis. Appraisal Journal, 40(4), 513–521.
Hendra, F., Supriyono, S., Efendi, R., Rosalinda, R., & Indriyati, R. (2021). a Business Feasibility Analysis of Small and Medium Enterprises for Product Strategy Determination. SCIENTIFIC JOURNAL OF REFLECTION : Economic, Accounting, Management and Business, 4(3), 421–431. https://doi.org/10.37481/sjr.v4i3.320
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Horngren, C., Sundem, G., Burgstahler, D., & Schatzberg, J. (2014). Management accounting. In Pearson. https://doi.org/10.4324/9780203404003-12
Husemann, M., Kirste, A., & Stumpf, E. (2024). Analysis of cost-efficient urban air mobility systems: Optimization of operational and configurational fleet decisions. European Journal of Operational Research, 317(3), 678–695. https://doi.org/10.1016/j.ejor.2023.04.040
Kraus, K., Kraus, N., & Pochenchuk, G. (2021). Principles, assessment and methods of risk management of investment activities of the enterprise. VUZF Review, 6(3), 45–58. https://doi.org/10.38188/2534-9228.21.3.06
Liu, M., Hao, H., Sun, X., Qu, X., Wang, K., Qian, Y., Hao, X., Xun, D., Geng, J., Dou, H., Deng, Y., Du, S., Liu, Z., & Zhao, F. (2024). Exploring the key technologies needed for the commercialization of electric flying cars: A levelized cost and profitability analysis. Energy, 303(March), 131991. https://doi.org/10.1016/j.energy.2024.131991
Munisami, A. (2010). Aircraft Financing : Perspectives for Small and Emerging Economies. June.
Peterson, P., & Fabozzi, F. (2002). Capital Budgeting Process: Theory and Practice. In Interfaces (Issue 2). https://doi.org/10.1287/inte.17.2.78
Pons-Prats, J., Živojinović, T., & Kuljanin, J. (2022). On the understanding of the current status of urban air mobility development and its future prospects: Commuting in a flying vehicle as a new paradigm. Transportation Research Part E: Logistics and Transportation Review, 166(April), 102868. https://doi.org/10.1016/j.tre.2022.102868
PT XYZ. (2023). InvestDeck.
Rocha, J., Oliveira, S., & Capinha, C. (2020). Introductory Chapter: Risk Management. Risk Management and Assessment, 1–10. https://doi.org/10.5772/intechopen.93553
Samonas, M. (2015). Financial Forecasting. In Wiley (Vol. 01).
Sampathkumar, A. (2022). Electric VTOL (EVTOL) aircraft market - a global and Regional Analysis: Focus on design, range, use case, mode of operation, energy source, component, and country - analysis and forecast, 2023-2032. bisresearch. https://bisresearch.com/industry-report/global-electric-vtol-aircraft-market.html
Shapiro, E., Davies, K., & Mackmin, D. (2012). Modern methods of valuation, tenth edition. In Modern Methods of Valuation, Tenth Edition. https://doi.org/10.4324/9780080937564
Thoburn, N. (2022). Measuring Return on Investments. Deleuze and Politics, 98–120. https://doi.org/10.1515/9780748631964-007
Thompson, A. A., Peteraf, M. A., Gamble, J. E., & Strickland III, A. J. (2022). Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases 23Rd Edition (International Edition).
Wang, L., Deng, X., Gui, J., Jiang, P., Zeng, F., & Wan, S. (2023). A review of Urban Air Mobility-enabled Intelligent Transportation Systems: Mechanisms, applications and challenges. Journal of Systems Architecture, 141(May), 102902. https://doi.org/10.1016/j.sysarc.2023.102902