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The UAM Market – An Analyst Point of View

While eVTOL aircraft producers see a multi-billion dollar global market for urban air mobility (UAM), one global aviation consulting firm analyst sees some challenges ahead, at least at this point in time. 

“In order for the UAM business case to work, eVTOLs will need to operate at a high frequency—high cycle—basis,” said Joshua Ng, Director and Head of Tech and Mobility in the Singapore office of New York headquartered Alton Aviation Consultancy. “Accommodating these high frequency operations in both congested urban cores, as well as at busy international airports, will certainly require investment in updated airspace management infrastructure, training for air traffic controllers, and development of concept of operations (ConOps) for this new paradigm of air travel. Integrating eVTOLs into Class B airspace will be a top priority for all industry stakeholders.” 

In fact, according to Ng, during the initial phases of commercialization, the first generation eVTOLs coming to market will be primarily focused on the airport transfer use case. 

“This approach by operators is sensible for several reasons,” he stressed. “In its sub-scale early stages, the eVTOL industry will likely have higher vehicle acquisition and operating costs relative to the mature stage. As a result, revenue generated from initial eVTOL use cases must be able to support these higher costs. Customers at the upper end of the commercial aviation market typically highly value their time and are more willing to pay for discretionary services, such as the higher per-seat costs for eVTOL flights in the industry’s early stages.”

Although the market appears to exist, the sobering reality, as Ng pointed out, is the lack of ground-based infrastructure. “Many cities that will eventually serve as eVTOL launch markets do have conventional helicopter infrastructure in place,” he said. “However, there will need to be significant investment in charging infrastructure to facilitate eVTOL operations at these existing facilities, which will also require upgrades of electric grids at airports and potentially in cities. Construction of new vertiports, including some with the ability to support operations involving several vehicles at once, will be required to facilitate urban air mobility at the scale envisioned by the OEMs and operators.” 

Ng added that while many creative ideas for the placement and construction of vertiports have been raised, including the conversion of parking structure roofs, these conversion projects will require significant financial investment. 

“Vertiports must have the capacity to conduct safe and efficient eVTOL operations involving several vehicles at a given time and offer sufficient passenger services, such as check-in and security screening,” Ng stated.

As with any real estate, the viability of vertiports will depend on location, location, location. 

“Central to the value proposition of the airport transfer use case is time savings. Most airport transfer eVTOL flights will require the passenger to embark on an initial ground leg—via public transportation, taxi, Uber, or on foot—to arrive at the vertiport from which the eVTOL departs,” Ng said. “Depending on the length of time this takes, there is a risk that the time savings of the eVTOL flight is eroded by the initial ground leg, rendering the eVTOL value proposition less attractive versus the traditional airport transfer modes. As a result, eVTOL operators must ensure that origin points are conveniently located to preserve the time-saving value of their flights.” 

Asked if any facilities currently exist to support urban air mobility operations, Ng replied, “At the moment, no.” 

Then there is the matter of air infrastructure, for which regulators are defining the blueprints for airspace integration. 

“The full ConOps between ground, air, and vehicle needs to be developed and rigorously tested before entry into service,” Ng stressed. “Enhancements will be required to existing airspace management in order to accommodate the entry of thousands of additional aircraft into the national air space, particularly since initial use cases will involve flying in and around Class B airspace—the controlled airspace surrounding the country’s busiest airports.”

By Paul Seidenman


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