Advanced Air Mobility – Cost Economics and Potential

 Executive Insights

 The advanced air mobility (AAM) industry is rapidly taking shape around the world

AAM is on the cusp of commercialisation, with multiple electric vertical take-off and landing (eVTOL) aircraft manufacturers and operators competing to be the first to launch. There are over 200 aircraft designs in development and various business models. Many are in the design testing phase, with more than 30 companies engaging in certification with the US Federal Aviation Administration (FAA), and several in the process of certification with EASA (European Union Aviation Safety Agency).

Commercialisation efforts are backed by material investments in the industry. Earlier this year, Toyota led a USD 394 million investment in Joby, Volocopter attracted a USD 113 million investment and China-based EHang’s IPO valuation was USD 650 million. The first commercial passenger flight is likely to launch within the next three to five years with piloted aircraft, before transitioning to remote piloted operations.

AAM has the potential to revolutionise urban and regional transport through reduced travel times and improved mobility options. In addition, the industry can be scaled with relatively small amounts of capital compared to other more asset-intensive transport alternatives such as road and general aviation.

The commercial returns of AAM can be very attractive, especially at scale and under a remote piloted scenario. This Executive Insights explores the commercial attractiveness of AAM, how the industry might scale and the triggers to profitability.

Characterisation of the AAM industry

The possible applications for AAM via eVTOL aircraft are far reaching. The two biggest markets are passenger travel, for commuting, tourism, major events and sightseeing; and freight transport, for urban and regional package delivery.

But there are a variety of other beneficial use cases: medical transport for both patients and critical supplies; offshore rig supply and agricultural crop protection; non-passenger recreation such as hobby use and for photography; infrastructure inspection and mapping for power grid, rail and other assets; emergency services use for search and rescue and firefighting; and military and civil defence applications such as bushfire management and post-disaster assistance.

This report focuses passengers and freight market segments. Download report to find more!