Joby Aviation, Inc. ( JOBY ) shares are trading higher after the company announced that Toyota Motor Corporation ( TM ) will invest an additional $500 million to support electric air taxi certification and commercial production.

The investment will be made in two equal tranches of $250 million each, with the first expected to close later this year and the second in 2025.

This investment will increase Toyota’s total stake in Joby to $894 million and will be made in cash for common stock.

“Today’s investment builds on nearly seven years of collaboration between our companies,” said JoeBen Bevirt, founder and CEO, Joby Aviation ( JOBY ).

On October 1, 2024, Joby Aviation ( JOBY ) entered into a stock purchase agreement with Toyota ( TM ), providing for the issuance and sale in a private placement of up to an aggregate of 99.40 million shares at a purchase price of $5.03 per share, a regulatory filing shows.

The funds will support the certification and commercial production of Joby’s electric air taxi, with terms including plans to establish a manufacturing alliance for the initial phase of commercialization.

Toyota’s relationship with Joby began with an initial investment from Toyota Ventures, the company’s early-stage venture capital arm that seeks out disruptive technologies and investment opportunities while supporting its portfolio companies.

This was followed by additional investments from Toyota ( TM ), bringing the total to $394 million.

Joby is making significant strides toward commercialization, having recently rolled out its third aircraft from its pilot production line in Marina, California, and commenced construction on an expanded facility that will more than double its manufacturing footprint.

As of August 2024, Joby confirmed that it has completed over one-third of the fourth of five stages in the type certification process.

“The knowledge and support shared by Toyota ( TM ) have been instrumental in Joby’s success and we look forward to deepening our relationship as we deliver on our shared vision for the future of air travel,” Bevirt added.

Last month, Joby disclosed its initial step toward becoming a certified air taxi operator in the United Arab Emirates.

Investors can gain exposure to the stock via WisdomTree Trust WisdomTree Battery Value Chain and Innovation Fund .

Price Action: JOBY shares are up 24.3% at $5.954 at the last check Wednesday.

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