Podcast: Merlin New Zealand sheds light on pathway to approval

Boston-based Merlin and its New Zealand-based affiliate, Merlin NZ, are working hard to certify the Merlin Pilot autonomous flight software in New Zealand next year. Merlin NZ is prepared to shoulder the load to ensure Merlin Pilot is put into commercial freighter service after certification by the Civil Aviation Authority of New Zealand (CAANZ), Merlin NZ Chief Executive Grant Crenfeldt says in this week's episode of “Cargo Facts Connect.” “At that point, [we would say that] Merlin, a technology organization, has the Merlin Pilot installed into the Cessna Caravan that we have here in New Zealand,” Crenfeldt says. “And then we’ll take that aircraft, put it onto the Merlin airline AOC, similar to how a fully certified aircraft goes on to a certificate, and then we start flying commercial freight routes using that aircraft.” The anticipated approval of the Merlin Pilot by the CAANZ in 2027 would represent the first time a conventionally crewed fixed-wing aircraft equipped with autonomous flight technology enters revenue cargo service, Crenfeldt says. Merlin is already looking beyond New Zealand and setting its sights on obtaining FAA certification. “The CAANZ and the FAA have a bilateral agreement, which means that if one or the other regulator certifies something, then the other regulator can choose to apply the amount of due diligence to that certification before they approve it as well,” Crenfeldt says. Merlin's technology, for which it obtained an experimental certificate of airworthiness from the CAANZ in 2025, is designed to operate existing aircraft in commercial airspace without requiring changes to air traffic management procedures, he says. Tune in to this week’s episode of “Cargo Facts Connect” to hear Crenfeldt speak with Editor Jeff Lee, Senior Associate Editor Robert Luke and Associate Editor Jay Aelick. A transcript is available below. This transcript has been generated by software and some transcription errors may remain. Robert Luke Hello and welcome to another episode of Cargo Facts Connect, the podcast of cargo facts, the publication of record for the air cargo and freighter aircraft industries for over 40 years. I’m Senior Associate Editor Robert Luke, and it’s Friday, July 10th. Cargo Facts recently spoke with Merlin New Zealand Chief Executive Grant Crenfeldt, who shared his insights on the journey the autonomous software developer has taken to get its Merlin Pilot through the final leg of the certification process. Take a listen. Grant Crenfeldt We came to New Zealand for a number of reasons. A country that has a strong aviation background, but it also has really challenging real world conditions, whether that changes quickly, environment that's significantly different over short distances. And importantly, an aviation authority that's very well respected in the world, holds us to the highest standards, and has a direct relationship under our bilateral agreement with the FAA. So a whole lot of things come together in New Zealand and resulted in us deciding that this would be a good place to base ourselves in the start of our civilian certification program. As you say, we set up our 135, so our air operator certificate at the end of 2024, with the intention of being able to achieve two things. So first of all, to be operating in New Zealand which enabled Merlin as an organization and us as people within the Merlin organization to build the trust and confidence of the regulator so that they can see that we are, as an organization, capable of undertaking commercial freight operations. And it also introduced us to the kind of wider aviation ecosystem as well. So we, you know, are now familiar with and speak to regularly Airways Corporation, CIA, obviously, but also other organizations within the ecosystem too. So whether we're talking with airlines or whether we're talking to some of the smaller operators, it's just all building the confidence of everybody in Merlin. And then the second part of that is clearly we want to be the first company to put real autonomous flight into actual commercial service. So we obviously, there's timelines to be able to meet starting up as an airline and we needed to start that process early. So 2024 when we got our certificate and we started some commercial operations under our test auspices in 2025 and have been carrying on with that in partnership with a couple of organizations here in New Zealand. That kind of brings, takes us up to where we are now. Robert Luke Thank you, Grant. I appreciate that. Briefly touch on how Merlin was able to coordinate the flight test in New Zealand with the Civil Aviation Authority of New Zealand and the FAA. And what was that experience like? Grant Crenfeldt So, you know, I wouldn't say it's a normal, well, it's a normal process, but it's not a regularly done process, of course. So normal experimental certificate under the regulatory authority enables us to undertake development and certification flying on an airframe. Working with the CIA has been a great experience. You know, they're a very progressive organization, but at the highest standards of a regulatory authority. They've been the prime regulator, so under the bilateral agreement that the CIA have with the FAA. the CIA is the prime and then they discuss all of the elements that need to come together for eventual certification with the FAA. Normal process again, some of those conversations we're allowed to be involved in a three-way conversation. some of those conversations are between the regulators to work out how they will either create or enforce requirements and rules. So, you know, not seamless, but no certification processes, challenging at times, but just pretty standard for us to work our way through. And so, being a good experience. Robert Luke Thank you. And obviously with the Merland pilot, which is an autonomous flight software system, this is an uncharted territory for everyone involved, whether it's the regulators or you as Merland, the developer of the system. What were some of the headwinds? I don't want to say headwinds, but what were some of the key takeaways that you gathered or that you have learned in the process of getting this new flight software system not only approved, but able to integrate into commercial airspace and fly with manned crew systems. Grant Crenfeldt So I think it's probably two things there. The second part we'll deal with first. So integrating into an ecosystem with manned systems. You know, we are very specific with our technology. We are platform agnostic and we are environment agnostic in terms of the aviation ecosystem. So we specifically are building a technology that doesn't require any changes to normal aviation ecosystem. So the aircraft is behaving as if it has a human pilot on board. And in case of this certification, it will do. Actually, can you just repeat that that first part? Robert Luke Essentially, what were some of the, you know, the key takeaways that you learned as all, as everyone kind of experienced this? Yes. Grant Crenfeldt Yeah. The challenges. Headwinds, yeah, yeah, yeah, yeah. So probably the biggest challenge has been that we're all learning and developing this together. So in some cases, there haven't been rules for some of the technology that we're applying. And so, again, this process within the regulators to go through creating those rules to match a new technology. So we've had to go through that with them. But also, we're all creating a new technology. So the capability within the regulators has been challenging to get up to speed to match the capability within our organization. But that's again, very normal, very standard. We can't expect the regulator to be at the level of a new technology organization. So along with working as A three-way group to work out how we certify the technology, we've also equally had to bring everybody up to the same level of technology capability as well. And again, you know, challenging, can take some time, to a certain extent drives timelines, but kind of normal within the realms of what we do. Robert Luke Okay. And as we look at the completed milestones, you received the experimental certificate of approval last year from New Zealand, and recently you completed the SOI1 and two reviews of your autonomous flight software. What milestones need to are remaining to complete before the Merlin pilot receives certification from the Civil Aviation Authority of New Zealand? Grant Crenfeldt Yeah, so there's two more stages in the SOI process that we need to go through, so three and four. We have target dates that we've agreed with the regulator for soy three, which is the next and biggest milestone of that process, and those dates are imminent. So we're expecting to be able to talk about those shortly, which is incredibly exciting to get to that stage. The final process is essentially where the regulators and the applicant us come together and you know, essentially say, yes, look, you've completed the three previous stages and here's the final agreement that you've met everything that you need to meet. So that stage is still to come. And then we go into the final certification process, which is really flying the aircraft with the regulator and working our way through all of the requirements that we need to meet under each of the rules and just showing them that it does work and showing them that we have repeatability on them. And so we're expecting to go into those in the third quarter of this year as well, into that process too. Robert Luke If you can just expand on some of the events or testing that needs to be done in SOI 3. I'm presuming that SOI 1 and SOI 2 are just kind of like a basic introduction to some of the operational protocol and then it upgraded to certain few more in SOI 2. What are some of the test procedures that are required to receive the approval for SOI 3, if you can expand on that, Grant? Grant Crenfeldt Yeah. So essentially, SOI one is where the applicant describes the way in which they expect to be able to meet requirements. SOI is where the regulator comes in and says, your processes to meet that requirement, those requirements are adequate. And then in SOI 3, they start going through with the applicant, all of those requirements and saying, yes, you've met those requirements. So that's the kind of detailed part of the soy process. And like I say, we've got an agreed date on when we're going into that now in the next little while. And we're expecting that to be a very straightforward process now. Essentially, you know, between SOI 2 and SOI 3, there's an awful lot of work between the regulator and the applicant that's going on. So that there's, you go into the formal SOI 3 process and it's just a formality. So we're at that point now. And then, like I say, SOI 4 is essentially where the two parties sit down and go through line by line and go, yes, you've made that, yes, you've made that. Robert Luke Understood. Thank you. You brought up an interesting point. As you get closer to certification, you mentioned in your release there on LinkedIn that Merlin expects to obtain approval from the Civil Aviation Authority of New Zealand in 2027. What happens next when you get that certification? Does this now enable you to begin putting the software they used in aircraft with customers that have already placed orders for it, and you begin integrating into regular airspace. Walk us through these steps after we're here at the finish line of the certification process. What happens afterwards? Grant Crenfeldt So, so at that point, we we press describe it as Merlin, as a technology organization, has the Merlin pilot installed into the Cessna Caravan that we have here in New Zealand. And then we take that aircraft, we put that aircraft into the Merlin airline air operating certificate. So a fully certified aircraft goes on to the air operator certificate, and then we start flying commercial freight routes using that aircraft. So we put it straight into revenue service, so first time in the world that will have had a traditionally crewed, fixed-wing autonomous aircraft in real revenue service. Robert Luke Okay. Hey, Grant, just out of curiosity, you just we talk about the Maryland pilot. I'm just going to go off script for a brief second here. Is this like an autonomous system that continues to learn from each flight or scenario that it accomplishes or goes through? Explain to us how the Merlin pilot is kind of similar to a man pilot, but yet different. Grant Crenfeldt Yeah, it's a good question. So, I mean, we say that we take the skills of the human pilot and turn them into software. And then, just like a human pilot, those skills can be applied to a Cessna caravan, as we are in this case. Or tomorrow, the pilot could wake up and be told that they're going to go and fly, you know, a Cessna citation. So we just take the core Merlin pilot and say, you're flying a Cessna caravan today, or tomorrow you're flying a Cessna citation. And here's a slightly different skill set that you need to have, but essentially the core skills of the human pilot are still the same. Robert Luke Okay. Jay Aelick Is it all right if I also jump in and ask a question that's a little bit off script about that? Grant Crenfeldt Sure. Jay Aelick Is it different instances of the same AI on different aircraft, or is it one single instance that's shared across aircraft? Grant Crenfeldt Do you mean if across different types of aircraft or within one type of aircraft but multiple aircraft? Jay Aelick I mean, I mean both. Grant Crenfeldt Okay, so system could be put onto multiple, so perhaps take it back to the certification process. If we were to install it onto multiple different Cessna caravans, it would be thus exactly the same system. But then, kind of as I was describing earlier, we have the core Merlin pilot. And I guess the way to think of this is, if I go to flight school, I come out and I have the skills to be a pilot. Now I go and learn how to fly a Cessna caravan, or I learn how to fly a Boeing 777. So adding on a slightly different building block depending on each platform. So to bring it back to the AI question, slightly different skill set within that AI, but core Merlin pilot AI skill set. Does that make sense? Jay Aelick Yeah, it does. Thank you. Robert Luke As we look at the test bed, the Cessna 208 that you're using in New Zealand. Kind of just give us a breakdown of what type of flights you've already performed with the testing that's been completed. And if you can share what kind of payload has the Maryland pilot transported during this testing phase? Grant Crenfeldt Yeah, so probably 2 distinct sets of testing. The first is around specific development of the Merlin pilot on the Cessna Caravan. And that kind of breaks down into two things. So developing the core Merlin pilot, and then developing the core or adding the skill of the core Merlin pilot to fly the Cessna Caravan. So we've been doing both of those things in New Zealand in parallel with our team in the US, development of the Merlin pilot and development of the ability to for that pilot to fly the caravan. And then the second part of what we're doing in New Zealand is, has been building up some testing and capability and data around operating both the caravan and the Merlin Pilot in the real ecosystem. So the freight movements that we've been undertaking to date have not been on an aircraft equipped with the Merlin Pilot, but we've been gathering data that supports the development of it. So by that I mean air traffic control information, voice recognition, how does the caravan specifically operate on a commercial freight operation? How does it operate specifically, you know, at 150 knots versus typical regional airliners that are doing 250 around us? So gathering data type of information to put into the development process. Robert Luke Okay. And just for a little understanding of operational parameters, will the Merlin pilots still have to adhere when it comes to safety, same rules as a man pilot when we're looking at adverse weather conditions? Or would they be able to operate in weather conditions a manned crew probably would be forbidden to operate in. Grant Crenfeldt No, so the whole intention is that the aircraft and regardless of the platform that the Merlin pilot goes on to, the whole idea is that the aircraft is able to exactly replicate the capabilities and restrictions of a human pilot. So we don't expect to be going out and doing anything different that an operator would be asking of a human pilot. Now, I will preface that with: there are going to be scenarios, and I actually clarify that. I'm talking about the Cessna Caravan and freight operations there. Now, clearly we are developing systems to go into environments where we would perhaps have different risk assessments. And so therefore, the system is capable and will go into other environments where a civilian freight operation might have different assessments of the level of risk. I think probably just one other thing to add to the, you know, I talked about the government policy and the way they're enabling research and development and then the physical environment. But then the other really important part, of course, is that the CAA and the FAA have the bilateral agreement, which means that if one or the other regulator certifies something, then the other regulator can choose to apply the amount of due diligence to that certification before they approve it as well. So either zero or 100%, you know, you know, do it all over again. So that's a really important element in the choice to come here as well, gives us a good pathway and direct contact into the FAA as well as the CAA. Robert Luke So. You made a good point there, Grant. I just want to ask this real quick. With that bilateral establishment between the CAANZ and the FAA, the FAA, excuse me, how does that create or establish A pathway for EASA seeing that the EASA and FAA have a bridged agreement as well? Does that kind of allow you to facilitate more easier towards the EASA process once you get this first step completed and then work towards completing the approval with the FAA. Grant Crenfeldt Yeah, so it's a very similar arrangement if you like. So short answer is yes, it will facilitate it. We haven't gone into that process as yet, but eventually yes. Jeff Lee And just to end, you know, with New Zealand again, what kind of prospects, you know, do you see for, you know, the modern pilot in, well, actually both New Zealand and Australia, and you know, are you, do you think a lot of people are kind of waiting until you get certified before they, you know, maybe look at it even more closely or? Grant Crenfeldt Yeah, good question. I think, Australia is a big market, obviously. US then exponentially bigger. So clearly FAA certification for us is really important. We have a similar relationship between CAA and CASA in Australia as we do with the FAA. So Australia is obviously a market that we would have ambitions in. But just going back to the fact that the core Merlin pilot is very much platform agnostic. So there's clearly a market for single engine, single pilot IFR freight operations out there, but we are very quickly starting to work on what the next aircraft are going to be and where the markets for those types of aircraft are going to be and certainly not just restricting ourselves to the freight market. And as we're working through that, we're working through what the certification process and where the most appropriate regulator will be to work with on those coming platforms. Jeff Lee Makes sense. Great. Well, thank you, Grant. Robert Luke And thank you, Grant. It was definitely a pleasure meeting you, and we look forward to 2027. Grant Crenfeldt Likewise. Certainly do. Robert Luke That was Merlin New Zealand Chief Executive Grant Crenfeldt. And that’s all the time we have for today. For more coverage of the freighter aircraft market, visit cargofacts.com. Thank you very much for tuning in, and join us again next time. Subscribe to Cargo Facts Connect on iTunes or Spotify , or download the episode on Transistor . Cargo Facts Symposium 2026, the premier event for the freighter aircraft and air cargo industries, will take place in Nashville, Tenn., on Oct. 21-23. Find out more and register by Sept. 4 to take advantage of early-bird pricing.

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