Urban Air Mobility Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Urban Air Mobility Market Analysis

The urban air mobility market generated revenue of USD 3,903.0 million in 2023, which is expected to witness a CAGR of 33.8% during 2024–2030, to reach USD 29,717.9 million by 2030.

This is ascribed to the growing urban road traffic, leading to the surging need for an alternative to road transport, mainly for quick short- and medium-range travel. Additionally, a larger number of product launches is expected to enable the fast commercialization of eVTOL technology-equipped small aircraft.

The industry is already witnessing significant participation from transportation network companies, aerospace companies or aircraft manufacturers, and vehicle manufacturers.

For instance, the Uber Elevate unit of Uber Technologies Inc. is working with leading aircraft designers and manufacturers, such as Joby Aviation LLC, Karem Aircraft Inc., and Jaunt Air Mobility, to develop regulatory-compliant and airworthy small aircraft for passenger transportation via air taxi and airport shuttle. In the initial phase, the company has planned to commercialize its air taxi services in Dallas (U.S.), Los Angeles (U.S.), and Melbourne (Australia).

In the space of cargo-carrying drones or unmanned aerial vehicles (UAV), companies are supplying medical units and kits to hospitals and clinics situated in places where ground transportation incurs huge costs and takes a lot of time.

For instance, Zipline, a U.S.-based drone delivery service company, is providing medical supplies, including blood and vaccines, to health clinics, mainly in Rwanda and Ghana. The drones used for the delivery can fly at about 110 kmph and have a carrying capacity or payload of 1.75 kg and a round-trip range of nearly 160 km.

Furthermore, an aircraft manufacturer Airbus SE has developed and demonstrated a self-piloted eVTOL aircraft, CityAirbus, which will be used for UAM services in the near future.

In the global UAM market, companies are currently collaborating with each other for the fast commercialization and deployment of autonomous and unmanned aerial vehicles for low-altitude flights.

With these collaborations, market players would be able to synergize their expertise for the faster development of the ecosystem for UAM vehicles, by overcoming challenges in noise emission, range, speed, and operating costs.

Urban Air Mobility Industry Trends & Drivers

Soaring Investments Act as a Major Industry Trend

• One of the major trends currently being witnessed in the industry is the soaring investments in startups operating in this niche.
• Leading companies operating in the ground transportation domain and those that offer cargo aircraft and conventional passenger services or manufacture automobiles are some of the major investors.
• For example, in June 2022, the chief leader of an autonomous aerial vehicle technology platform company, EHang Holdings Limited announced a partnership with Tianxingjian.
• This partnership is for the Scenic Flight Project with EH216 AAVs at the Aizhai Wonder Tourist Area in China. In addition to that, EHang has also announced the revival of a purchased order for five units of EH216 AAVs from Tianxingjian Cultural Tourism Investment and Development LLC.

Surging Road Traffic Will Drive the Expansion of Industry

• The worsening road traffic conditions in highly populated cities are a major factor that will fuel the expansion of the urban air mobility industry. The surging road traffic in urban areas is causing long traffic jams, which is, in turn, leading to the wastage of valuable time. This is subsequently slowing down the economic progress of many countries.
• For example, Americans, on average, spend around 100 hours in traffic jams every year. Moreover, traffic jams augment the annual transportation expenditure of Americans by more than $1,000.
• Additionally, the increasing road traffic congestion is causing a sharp surge in the incidence of road accidents, especially in emerging economies such, as India, China, and Indonesia.
• Because of these reasons, the popularity of autonomous aerial mobility solutions is growing rapidly across the world, which will fuel the progress of the market.

Stringent Regulatory Framework

• The growth of the UAM market has been restrained by various regulations imposed by governing bodies, including aviation agencies and central and state governments, globally.
• The issues faced by players due to the regulations imposed by these bodies hamper product or aircraft certification, airworthiness certification, commercial operational approval, and various other processes.
• For instance, the commercialization of piloted and unmanned vehicles requires not only meeting the certification requirements for new platforms, but also getting certified for the new power storage mechanism, infrastructure, communication and navigation, air traffic management system, and various other systems, which generally takes a long time.
• Although in a few countries, regulatory authorities have rolled out new rules, in cooperation with leading UAM market players, for the faster deployment of this new transportation mode, the existing strict regulations in most cities stand as the major restraint in the growth of the UAM market.

In-Depth Segmentation Analysis

Aircraft Type Insights

• The passenger category held a larger market share, of around 75%, in 2023. This is credited to the fact that the demand for passenger flights will be more than that for cargo delivery services around the world.
• In addition to this, low-altitude passenger flights are predicted to be more expensive than last-mile and cargo delivery services.
• Additionally, because of traffic congestion, the usage of passenger aircraft is expected to be higher than cargo delivery drones.
• Moreover, operators are expected to first implement this service for trips from airports to fixed points in and outside cities.

During the study, we have analyzed two aircraft types in the report:

• Passenger (Larger Category)
• Cargo (Faster-Growing Category)

Range Analysis

• The intercity category is predicted to demonstrate faster growth, advancing at a CAGR of 34.2%, in the market for urban air mobility services during 2024–2030.
• This can be because of the longer flight range of electrical vertical take-off and landing (eVTOL) aircraft, due to the rapid technological advancements in the motor, battery, and fuselage.
• Whereas, the intracity category dominates the urban air mobility market, as the aircraft is currently being specifically developed for intracity travel, on account of strict regulations the domain is subject to any limitation in the battery technology.

Below are the ranges that we considered during the study in the report:

• Intracity (Larger Category)
• Intercity (Faster-Growing Category)

Operation Type Insights

• The autonomous operation type category dominates the market, with a revenue share, of around 80%, in 2023. This can be because autonomous aircraft are better suited for passenger and cargo services than piloted ones.
• Furthermore, aircraft manufacturing companies, airspace integration researchers, and infrastructure providers are making huge investments in autonomous UAM services.
• Whereas, the piloted category is expected to witness a higher CAGR, of 34.0%, during 2024–2030. This can be attributed to the rising deployment of advanced eVTOL systems in military aircraft as well as commercial aircraft.

During the study, we have analyzed two operation types in the report:

• Piloted (Faster-Growing Category)
• Autonomous (Larger Category)

North America Holds 45% of Share

• Geographically, North America held the largest revenue share, of around 45%, in the market for urban air mobility services in 2023. This is because people residing in major North American cities are increasingly opting for air taxi and airport shuttle services on account of the escalating traffic congestion.
• Furthermore, in the U.S., last-mile and cargo services are expected to be extensively provided with eVTOL aircraft, which will positively impact the market in the region.
• In the cargo category, many U.S.-based e-commerce and logistics giants, such as Amazon.com Inc. and United Parcel Services Inc., and food delivery companies such as Uber Eats have been conducting pilot tests for the delivery of small parcels or packages to customers, directly via unmanned drones.
• Moreover, e-commerce and logistics companies are considering charging an amount of about $2.0 per delivery in the initial phase and then reducing it to about $0.8 during the growing phase.
• The UAM concept for both manned and unmanned aircraft has been facing challenges, owing to the strict regulations imposed by the FAA in the U.S.; however, recently, the agency partnered with NASA to modify regulatory policies for eVTOL-equipped low-altitude aircraft, including creating a smooth certification process for the operators and aircraft.
• On the other hand, Europe is the fastest-growing market, advancing at a CAGR of 34.3%, during 2024–2030. This is on account of the heavy investments being provided by Germany and France, for the procurement of the eVTOL technology for commercial operations.
• Other reasons behind the robust advance of the market in the region would be the enhancements in the manufacturing capabilities of European UAM companies, globalization, and the expanding trend of automation.

Further, regions and countries analyzed for this report include:

• North America (Largest Regional Market)
  • U.S. (Larger and Faster-Growing Country Market)
  • Canada
• Europe (Fastest-Growing Regional Market)
  • Germany (Largest Country Market)
  • U.K. (Fastest-Growing Country Market)
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific (APAC)
  • China (Largest Country Market)
  • Japan
  • India (Fastest-Growing Country Market)
  • South Korea
  • Australia
  • Rest of APAC
• Latin America (LATAM)
  • Brazil (Largest and Fastest-Growing Country Market)
  • Mexico
  • Rest of LATAM
• Middle East and Africa (MEA)
  • Saudi Arabia (Largest Country Market)
  • South Africa
  • U.A.E. (Fastest-Growing Country Market)
  • Rest of MEA

Competitive Analysis

The urban air mobility market is consolidated, owing to a few key players accounting for a substantial share. Further, since the market is a future opportunity, major companies hoping to make a fortune are entering into partnerships and joint ventures, to give them the maximum chance of success.

Urban Air Mobility Industry News

• Lilium N.V. signs a strategic partnership with Air-Dynamic SA for up to five Lilium Jets with pre-delivery payments to serve Italy and Switzerland. The air dynamic supports a new generation of electric aircraft that will operate and achieve these Lilium Jets for its customers in the country.
• Eve Air Mobility has entered into a Letter of Intent with Ferrovial Vertiports, to explore the usage of Urban Air Traffic Management (Urban ATM) software solution for supporting the safe and reliable operation of electric vertical take-off, vertiports, and landing (eVTOL) aircraft.
• Geely Aerofugia, which is a Chinese automaker has successfully conducted the test flight of its prototype flying car, the AE200, bringing the company closer to its goal of introducing eVTOL vehicles to the market. Additionally, the company unveiled a full-size demonstrator for its TF-2 five-seater eVTOL in August 2022.