New Study Projects UAM Market at $80 Billion by 2050

 - July 23, 2020, 9:27 AM
Earlier this month, Chinese eVTOL developer EHang started offering non-revenue sightseeing demonstration flights over the coastal city of Yintai in its all-electric, autonomous aircraft. (Photo: EHang)

More than 160,000 eVTOL aircraft are expected to be carrying passengers in urban air mobility (UAM) services by 2050, according to new research by aviation consultants Roland Berger. In a report presented for the FIA Connect event on July 23, the company said that it expects such operations to be evenly divided between what it defined as “city taxi” (on-demand flights of 15-50 km), “airport shuttle” (also 15-50 km, or up to around 30 miles), and “intercity” (scheduled flights of between 50 and 250 km, or up to around 150 miles).

Of the $80 billion annual value projected for the new UAM market by 2050, Roland Berger calculates that airport shuttle and inter-city flights will account for most of that amount (respectively 50 and 40 percent), while city taxi journeys take the remaining 10 percent.

“To start with we think [UAM] services will be quite highly-priced and exclusive, but in the longer term [as operating costs become more scalable] it will be more like today’s premium public transport services, such as taxis,” said Manfred Hader, head of Roland Berger’s aerospace and defense practice.

Some of the many contenders to enter the eVTOL market are pushing hard for early service entry, perhaps as soon as 2023. However, the vast majority of some 2,100 aerospace industry executives surveyed by Roland Berger indicated that they do not find that timeframe credible, with 51 percent saying they expect it to happen in between 5 and 10 years, 34 percent predicting more than 10 years, and just 13 percent expecting it within five years. Two percent of respondents said that UAM will never happen.

Roland Berger’s Center for Smart Mobility also has tracked through its UAM Radar the status of 100 UAM launch projects around the world to identify where the early adopter communities will appear. It identified 54 prospective city-based UAM projects in Europe, 25 in the Asia-Pacific region, 21 in North and South America, six in Africa, and two in the Middle East.

In Dallas, Texas, ride-hailing group Uber says it will be ready to launch revenue flights with one or more of its eight eVTOL manufacturing partners in 2023. Test flights could start in the city by the end of 2020, and Uber continues to actively lay the infrastructure groundwork needed to support operations.

In the Chinese city of Guangzhou, eVTOL pioneer EHang has conducted demonstration flights since 2018, including some carrying passengers. The company has not yet announced a timeline for full revenue services to begin but the Civil Aviation Administration of China has allowed it significant latitude for the trial operations.

In Paris, Airbus is partnering with city public transportation agency RATP to launch pilot eVTOL operations during the 2024 Summer Olympic Games, due to take place in the French capital. Many suggest that full-scale services might not get underway until 2030, however.

“The startup companies are typically being more bullish for operations to start by 2025 at the latest because their funding depends on having good news to attract investors,” said Hader. “The legacy aerospace companies are being more cautious and are looking at the late 2020s or early 2030s.”

Roland Berger’s research has confirmed its view that public acceptance stands as a major barrier to UAM adoption. It pointed to recent research by Airbus showing that almost 56 percent of 1,500 respondents have concerns about the safety of individuals on the ground while 49 percent expressed concern about noise.

The consultancy endorsed the growing consensus that eVTOL operations might gain more early traction with cargo-carrying operations that could prove the safety and noise case for passenger applications. Its study showed that the German capital Berlin might be able to support around 1,200 unmanned aircraft delivering 4 million packages each year, the equivalent of one for each Berlin resident.

Overall, Roland Berger does not expect the Covid-19 crisis to significantly affect the timeline for the emerging UAM sector. However, the report did suggest that some companies might now struggle to find the funding they need to advance their aircraft to type certification.

Eric Allison, head of Uber Elevate, confirmed that viewpoint. He told a separate FIA Connect webinar that some eVTOL developers at the earlier stages of “prototyping” their aircraft might struggle due to Covid disruption and increased difficulty securing funding. However, he stressed that several companies are now making good progress towards type certification.

Allison said that Uber is now prioritizing service entry for all-electric eVTOLs, as opposed to hybrid-electric models. He said that battery technology can now support the relatively short flights envisioned by its planned Uber Air urban and suburban networks. In the early stages, Uber projects it can achieve flight hour costs of less than $700, and Allison said the pricetag will go “much lower” as it scales up operations.