Oct 20 (Reuters) -

Archer Aviation ( ACHR ) on Monday said it signed a partnership with Korean Air

to commercialize its electric air taxis in South Korea, with a potential purchase of up to 100

aircraft.

The deal underscores an intensifying race among electric vertical take-off and landing

developers to win regulatory approvals, lock in airline partners and move from prototypes to

paid service.

Shares of the Santa Clara, California-based company rose 6% in early U.S. trading.

Startups and aerospace incumbents alike are pitching short urban hops and airport transfers

as faster, lower-emission alternatives to congested ground transport, even as the sector

contends with certification hurdles, infrastructure build-out and uncertain timelines to

profitability.

Archer said the agreement targets deployment of its Midnight eVTOL "across multiple

applications and use cases, starting with government applications."

The aircraft is designed for 10-20 minute flights and last month completed a series of

performance test flights, with two of its highest-altitude flights to date.

Backed by Boeing ( BA ) and Stellantis ( STLA ), Archer is producing six aircraft at two

U.S. plants and counts United Airlines and the owner of India's IndiGo among

its customers.

Archer, which is yet to turn a profit, expects an adjusted EBITDA loss of $110 million

to $130 million in the third quarter, wider than last year's $93 million loss.

Last week, Archer said it won a bid to acquire rival Lilium's portfolio of about 300

advanced air mobility patent assets for 18 million euros ($21 million), expanding its own

portfolio to over 1,000 patent assets.

($1 = 0.8575 euros)