Dec 30 (Reuters) - Air taxi start-up Volocopter GmbH

filed for insolvency proceedings on Monday, citing its inability

to raise new funds to maintain regular operations.

The Mercedes-Benz and Honeywell ( HON )-backed

company plans to continue business operations during the

insolvency proceedings while seeking additional funding.

"Despite recent intensive fundraising efforts, finding a

viable solution to maintain regular operations outside of

insolvency proceedings has not been possible," the Bruchsal,

Germany-based firm said.

The electric vertical takeoff and landing (eVTOL) industry

is facing a financial crunch, with companies persistently

seeking new investments to support their capital-intensive

operations as companies prepare for commercial operations.

In November, peer Lilium said it would file for insolvency

"soon", after failing to resolve its financial difficulties.

Founded in 2011, Volocopter was scheduled to enter the

market in 2025 with its urban eVTOL, the VoloCity.