Joby Aviation (NYSE: JOBY) closed Wednesday's session down 0.9% at $8.84, following the release of a regulatory filing detailing Toyota Motor Corp's (NYSE: TM) expanded manufacturing joint venture. The stock traded between $9.31 and $8.73 on volume of approximately 45.9 million shares, well above the 65-day average of 32.1 million, representing about 144% of typical turnover.
Toyota JV Details Emerge
The filing with the U.S. Securities and Exchange Commission revealed that Toyota will hold a 51% stake in the newly formed Joby Toyota Aero Manufacturing Preparation Company, with Joby Aviation owning the remaining 49%. The initial paid-in equity is a modest $2.0 million, with Toyota contributing $1.02 million for 1,020,000 shares and Joby adding $980,000 for 980,000 shares. Toyota also secures three of the five board seats in the venture.
Importantly, the filing clarifies that the establishment of the stockholders agreement and the joint venture itself does not alone satisfy the conditions for Toyota's second tranche of investment under the existing stock purchase agreement. The funding is structured to be released in stages tied to specific certification and design milestones, including the completion of a critical design review, FAA Type Inspection Authorization, and ultimately, type certification. The total amount of future capital remains to be finalized.
Market Reaction and Context
The initial announcement of the manufacturing partnership on Tuesday had driven Joby shares up 7% in pre-market trading, but the gains evaporated by the close. The market's focus shifted to the conditional nature of the funding and the lack of an immediate cash injection for Joby. Toyota disclosed it currently owns 128.5 million Joby common shares, representing 13.1% of shares outstanding.
Joby CEO JoeBen Bevirt noted that Toyota has supported the company for nearly a decade, while Toyota Chairman Akio Toyoda described air mobility as a "natural extension" of the company's mobility vision. The broader eVTOL sector showed mixed performance, with rival Archer Aviation (NYSE: ACHR) rising 4.3% to $4.92, while major growth stocks like Rivian Automotive (NASDAQ: RIVN) fell 1.1%.
Certification Progress and Financial Position
Joby reported in May that its first FAA-conforming aircraft flew in the first quarter and that it completed the SR3 audit, the third of four major FAA certification checks. The company also noted that composites output more than doubled year-over-year, and its Ohio facility expanded to nearly 1.5 million square feet. As of Q1, Joby held $2.5 billion in cash, cash equivalents, and short-term investments, representing about 29% of its market cap of approximately $8.77 billion.
Short interest in Joby stood at 100.74 million shares as of June 15, or 16% of the float. Wednesday's trading volume of 45.9 million shares was about 46% of the short interest, meaning it would take more than two days of average volume to cover all short positions. This elevated short interest makes the stock particularly sensitive to certification news and milestones.
Broader Market Context
The broader market showed modest declines, with the SPDR S&P 500 ETF (NYSEARCA: SPY) off 0.1% at $745.76, the iShares Russell 2000 ETF (NYSEARCA: IWM) down 0.4% at $299.32, and the Invesco QQQ Trust (NASDAQ: QQQ) falling 1.5% to $725.17. The NYSE will close for Independence Day on Friday, July 3, 2026, leaving Thursday as the only full trading day before the holiday.
For Joby investors, the key takeaway is that the Toyota partnership, while strategically significant, does not provide immediate financial relief. The path to full funding is now explicitly tied to FAA certification progress, adding another layer of uncertainty to the company's timeline. With cash reserves providing a substantial runway but certification milestones determining the pace of Toyota's investment, Joby's stock remains highly dependent on regulatory developments in the coming quarters.
