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The advanced air mobility (AAM) market is shaped by several key factors that are driving its growth and development. One significant factor is the increasing demand for urban air mobility solutions to address growing urbanization and congestion challenges. As cities around the world continue to expand, traditional transportation infrastructure faces increasing pressure, leading to traffic congestion, air pollution, and longer commute times. Advanced air mobility offers a promising solution by providing on-demand, point-to-point air transportation services using electric vertical takeoff and landing (eVTOL) aircraft. These innovative vehicles have the potential to revolutionize urban transportation, offering faster, more efficient, and environmentally friendly alternatives to traditional ground-based modes of transportation.
Moreover, technological advancements play a crucial role in shaping the AAM market. Advances in electric propulsion, battery technology, lightweight materials, and autonomous flight systems are driving innovation in eVTOL aircraft design and manufacturing. Companies are investing in research and development to develop next-generation eVTOL platforms that offer increased range, improved efficiency, and enhanced safety features. Additionally, advancements in airspace management systems, traffic management solutions, and communication networks are enabling the integration of eVTOL aircraft into existing airspace infrastructure, paving the way for widespread adoption of advanced air mobility services in urban and suburban areas.
Furthermore, regulatory frameworks and policy initiatives influence market dynamics in the AAM sector. Aviation authorities and regulatory agencies are working to develop certification standards, safety regulations, and operational guidelines for eVTOL aircraft and AAM operations. These regulations are essential to ensure the safety, reliability, and airworthiness of eVTOL platforms and to address public concerns regarding noise, privacy, and airspace congestion. Policymakers are also exploring incentives, subsidies, and public-private partnerships to support the development and deployment of AAM technologies and infrastructure, driving market growth and encouraging industry collaboration and innovation.
Additionally, market demand for AAM solutions is driven by the need for sustainable transportation alternatives and environmental stewardship. With growing concerns about climate change, air pollution, and carbon emissions, there is a growing emphasis on transitioning to cleaner, greener modes of transportation. eVTOL aircraft offer a promising solution by leveraging electric propulsion technologies to reduce greenhouse gas emissions, noise pollution, and reliance on fossil fuels. As governments, businesses, and consumers increasingly prioritize sustainability and environmental responsibility, the demand for AAM services is expected to grow, driving market expansion and investment in electric aviation technologies.
Moreover, market factors such as urbanization, population growth, and changing mobility preferences contribute to the growth of the AAM market. As urban populations continue to grow, cities are facing increasing pressure to provide efficient, accessible, and sustainable transportation options for residents and commuters. eVTOL aircraft offer a flexible and scalable solution for addressing last-mile connectivity challenges, providing direct point-to-point transportation between urban centers, airports, and suburban communities. Additionally, changing mobility preferences, such as the rise of ride-sharing and on-demand transportation services, are driving demand for innovative and flexible transportation solutions that offer convenience, affordability, and reliability.
Furthermore, the emergence of new market players and business models is driving innovation and competition in the AAM sector. Startups, technology companies, and aerospace manufacturers are investing in developing eVTOL aircraft, infrastructure, and supporting technologies to capitalize on the growing demand for urban air mobility solutions. Additionally, new business models, such as mobility-as-a-service (MaaS) platforms, subscription-based air taxi services, and on-demand aerial ridesharing, are emerging to cater to diverse customer needs and preferences. This influx of new players and business models fosters innovation, drives technological advancements, and expands the range of AAM services available to consumers, driving market growth and accelerating the adoption of advanced air mobility solutions.
Covered Aspects:
| Report Attribute/Metric | Details |
|---|---|
| Growth Rate | 22.20% (2023-2032) |
Advanced Air Mobility Market Highlights:
Global Advanced Air Mobility Market Overview
Advanced Air Mobility Market Size was valued at USD 16.5 Billion in 2022. The Advanced Air Mobility market industry is projected to grow from USD 20.16 Billion in 2023 to USD 100.25 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 22.20% during the forecast period (2023 - 2032). Increasing urbanization demands for efficient transportation solutions and advancements in electric propulsion technologies are the key market drivers fueling the market growth.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Advanced Air Mobility Market Trends
Increasing demand for efficient transportation solutions in urbanized areas is driving the market growth
Market CAGR for advanced air mobility is being driven by escalating demand for efficient transportation solutions in urbanized areas. As the world experiences unprecedented levels of urbanization, traditional transportation infrastructures are grappling with congestion, pollution, and limited capacity. In response to these challenges, there is a growing recognition of the need for innovative and sustainable modes of transportation to address the mobility demands of densely populated urban environments.
Another critical driver fueling the growth of the AAM market is the continuous advancement in electric propulsion technologies. Traditional aircraft propulsion systems, reliant on fossil fuels, pose environmental challenges and are not aligned with the sustainability goals of modern societies. In response to these concerns, the AAM industry is at the forefront of adopting electric and hybrid-electric propulsion systems, contributing to a cleaner and more sustainable mode of transportation.
Additionally, the increasing need for rapid, on-demand mobility is also a significant driver shaping the AAM market landscape. Modern lifestyles demand flexibility and immediacy in transportation, and AAM services are uniquely positioned to cater to this demand. AAM vehicles, with their ability to operate on-demand and provide point-to-point connectivity, offer a level of flexibility and speed not achievable by traditional ground transportation modes.
According to the United Nations, the global urban population is expected to increase from 4.2 billion in 2018 to 6.7 billion by 2050, highlighting the rapid pace of urbanization. A study by the World Economic Forum estimates that traffic congestion costs are projected to soar to $293 billion annually by 2030, emphasizing the urgent need for alternative transportation solutions in urban areas. As a result the demand for Advanced Air Mobility will increase due to the rising urbanization and increased need for alternate transport medium. Thus, driving the Advanced Air Mobility market revenue.
Advanced Air Mobility Market Segment Insights
Advanced Air Mobility Component Insights
The Advanced Air Mobility Market segmentation, based on Components includes Hardware and Software. The software segment dominated the market, accounting for more than half of market revenue. This is attributed to the critical role it plays in managing and optimizing the operations of Advanced Air Mobility (AAM) systems.
Advanced Air Mobility Application Insights
The Advanced Air Mobility Market segmentation, based on Application includes Cargo Transport, Passenger Transport, Mapping & Surveying, Special Mission, Surveillance & Monitoring, and Others. The passenger transport segment dominated the market, accounting for more than one-third of market revenue. This is attributed to the increasing demand for rapid and convenient urban transportation, especially in densely populated areas.
Advanced Air Mobility Type Insights
The Advanced Air Mobility Market segmentation, based on Type includes Air Taxis, Drones, and Others. The air taxi segment dominated the market, accounting for above half of the market revenue. This growth is linked to their direct relevance to passenger transport in urban environments.
Advanced Air Mobility Operating Mode Insights
The Advanced Air Mobility Market segmentation, based on Operating Modes includes Piloted and Autonomous. The autonomous dominated the market, accounting for more than half of market revenue. This is ascribed to increased safety, reduced human error, and the potential for more efficient operations.
Advanced Air Mobility Propulsion Type Insights
The Advanced Air Mobility Market segmentation, based on Propulsion Type includes Gasoline, Electric, and Hybrid. The electric segment dominated the market, accounting for above half of the market revenue. This growth is linked to its alignment with global sustainability goals and the ongoing shift towards clean energy solutions.
Figure 1: Advanced Air Mobility Market, by Propulsion Type, 2022 & 2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Advanced Air Mobility End-Use Insights
The Advanced Air Mobility Market segmentation, based on End Use includes Commercial and Government & Military. The Commercial dominated the market, accounting for more than half of market revenue. The demand for on-demand urban air transportation services for passengers and cargo is largely consumer-driven
Advanced Air Mobility Regional Insights
By region, the study provides market insights into North America, Europe, Asia-Pacific, and Rest of the World. The North American Advanced Air Mobility market area will dominate this market. the region is a hub for technological innovation and investment, with Silicon Valley in the United States playing a pivotal role in the development of AAM technologies.
Further, the major countries studied in the market report are The US, Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 2: ADVANCED AIR MOBILITY MARKET SHARE BY REGION 2022 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Europe Advanced Air Mobility market accounts for the second-largest market share due to its proactive stance on urban mobility and environmental sustainability. The European Union has been at the forefront of adopting regulations and standards for unmanned aerial systems, fostering an environment conducive to AAM development. Further, the German Advanced Air Mobility market held the largest market share, and the UK Advanced Air Mobility market was the fastest-growing market in the European region
The Asia-Pacific Advanced Air Mobility Market is expected to grow at the fastest CAGR from 2023 to 2032 due to a combination of factors, including rapid urbanization, population density, and a growing demand for innovative transportation solutions. Moreover, China’s Advanced Air Mobility market held the largest market share, and the Indian Advanced Air Mobility market was the fastest-growing market in the Asia-Pacific region.
Advanced Air Mobility Key Market Players & Competitive Insights
Leading market players are investing in creating more efficient and powerful electric propulsion systems, enhancing the autonomy and safety features of their vehicles, and improving the overall user experience. Market participants are also adopting a variety of strategic activities to expand their global footprint, with important market developments including partnerships, new product launches, contractual agreements, higher investments, and mergers and acquisitions. To grow and survive in a more competitive and rising market climate, the Advanced Air Mobility industry must offer innovation.
Engaging with regulatory authorities to shape favorable policies and standards is a key strategy used by manufacturers in the global Advanced Air Mobility industry to increase their market share. In recent years, the Advanced Air Mobility industry has offered some of the most significant advantages to Consumers. Major players in the Advanced Air Mobility market, including Airbus S.A.S., Aurora Flight Sciences, Bell Textron Inc., The Boeing Company, Guangzhou EHang Intelligent Technology Co., Ltd., Embraer S.A., Joby Aviation, Lilium GmbH, Neva Aerospace Opener, Inc., PIPISTREL (Textron Inc.), Terrafugia, Vertical Aerospace Group Ltd., Volocopter GmbH, Wisk Aero, and Workhorse Group, Inc., and others, are attempting to increase market demand by investing in product development to increase their product line and cater to diverse consumer needs.
Airbus, a global aerospace and defense leader, prioritizes sustainability and innovation. With a focus on efficiency, it delivers cutting-edge solutions in commercial aircraft, defense, and connected services. As a European aviation powerhouse, Airbus leads in modern, fuel-efficient airliners and is prominent in defense, security, and space industries. Renowned for its efficient rotorcraft solutions, Airbus generated €58.8 billion in revenue in 2022 and maintains a workforce of approximately 134,000. Rooted in principles of respecting the planet, valuing people, and fostering prosperity, Airbus continually pioneers sustainable aerospace for a safe and united world. In September 2022, a Memorandum of Understanding was signed by Marignane, Airbus, and Ecocopter, marking the initiation of collaboration for the introduction of urban air mobility services across diverse Latin American countries. This collaborative effort represents a pivotal stride towards jointly establishing a functional urban air mobility ecosystem in the region.
Textron Inc., a global multi-industry leader, commands recognition for its renowned brands such as Bell, Cessna, Beechcraft, and E-Z-GO. With a robust presence in aircraft, defense, industrial, and finance sectors, the $12.9 billion company, established in 1923, boasts a workforce of 34,000 across 25+ countries. Textron's rich history is marked by groundbreaking technologies, and pioneering advancements in aircraft, rotorcraft, armored vehicles, and automotive systems. Committed to industry leadership, Textron values diverse talent, relying on its employees' skills to drive innovation and deliver exceptional products. The company's forward-looking approach emphasizes understanding customer needs and exceeding expectations in product development. In November 2023, Bell Textron Inc., under the umbrella of Textron Inc., was chosen to participate in the DARPA SPRINT X-Plane program, aiming to develop and showcase advanced technologies for the next era of air mobility platforms. The program involves designing and constructing an experimental aircraft to exhibit transformative capabilities in both speed and runway independence. Phase 1A focuses on the conceptual design, culminating in a formal Conceptual Design Review.
Key Companies in the Advanced Air Mobility market include
- Airbus S.A.S.
- Aurora Flight Sciences
- Bell Textron Inc.
- The Boeing Company
- Guangzhou EHang Intelligent Technology Co., Ltd.
- Embraer S.A.
- Joby Aviation
- Lilium GmbH
- Neva Aerospace Opener, Inc.
- PIPISTREL (Textron Inc.)
- Terrafugia
- Vertical Aerospace Group Ltd.
- Volocopter GmbH
- Wisk Aero
- Workhorse Group, Inc.
Advanced Air Mobility Industry Developments
June 2023: Honeywell Technology Solutions has inaugurated an Advanced Air Mobility Lab exclusively for drone testing in Madurai, India. The company recognizes significant market potential in the country's drone sector, particularly in the context of defense drones.
October 2023: Solvay was appointed as the primary composite material supplier to BETA Technologies, an electric aviation company based in Vermont with an office in Montréal, Canada. Solvay provided BETA with qualification support and advanced materials for the production of their ALIA CTOL, an electric fixed-wing aircraft, and ALIA VTOL, an electric vertical takeoff and landing aircraft. These aircraft were developed for various applications, including medical services, cargo transport, and passenger transportation.
Advanced Air Mobility Market Segmentation
Advanced Air Mobility Component Outlook (USD Billion, 2018-2032)
- Hardware
- Software
Advanced Air Mobility Application Outlook (USD Billion, 2018-2032)
- Cargo Transport
- Passenger Transport
- Mapping & Surveying
- Special Mission
- Surveillance & Monitoring
- Others
Advanced Air Mobility Type Outlook (USD Billion, 2018-2032)
- Air Taxis
- Drones
- Others
Advanced Air Mobility Operating Mode Outlook (USD Billion, 2018-2032)
- Piloted
- Autonomous
Advanced Air Mobility Propulsion Type Outlook (USD Billion, 2018-2032)
- Gasoline
- Electric
- Hybrid
Advanced Air Mobility End-Use Outlook (USD Billion, 2018-2032)
- Commercial
- Government & Military
Advanced Air Mobility Regional Outlook
- North America
- US
- Canada
- Europe
- Germany
- France
- UK
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- China
- Japan
- India
- Australia
- South Korea
- Australia
- Rest of Asia-Pacific
- Rest of the World
- Middle East
- Africa
- Latin America
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