BOSTON – July 22, 2024 – Commercial air taxi services, also known as advanced air mobility or small electric vertical take-off and landing (eVTOL) aircrafts may commence operations in the next two or three years, but will not reach scale until the mid-2030s, according to a new report by Bain & Company.

By 2035, small eVTOL aircrafts will likely transport passengers and cargo between city centers and local airports, across busy regions, and in remote areas. The benefits of this new travel mode which prides itself on lower cost, reduced emissions, and improved safety, could propel the global market to a fleet of 12,000 eVOTL aircrafts by 2035 and 45,000 by 2040, says the report.

“The creation of eVTOLs brings an array of investment opportunities. However, companies will face multiple challenges growing these businesses and achieving profitability. In addition, operators will also need to ensure flights are integrated into efficient end-to-end transport solutions, including seamless travel from starting location to flight terminals or vertiports,” said Mattia Celli, a Rome-based partner at Bain & Company’s Advanced Manufacturing & Services practice.

The report said that eVTOLs are unlikely to become a mass-market mode of travel. The price premium for eVTOL flights compared with ground transportation will limit their use to business and mid- to high-income individuals as well as cargo for hard-to-reach locations or expedited delivery.

The development of a vibrant market for advanced air mobility would depend on multiple factors including, safety, battery technology, new air traffic regulations, infrastructure, and aircraft certification and performance. Market growth will depend on efficient eVTOL routes and a dense network of landing and take-off vertiports that are convenient to passengers. In addition, eVTOL services will need to be embedded in the wider multimodal transportation system, including an end-to-end booking service with transfers.

Another key challenge is bringing down the total cost of ownership which will be determined by the aircraft acquisition price, maintenance expenses, and other operating costs. An eVTOL that seats four or five passengers (excluding multi-rotor aircraft) is expected to cost between $3 million and $6 million and have an economic life of about 10 years. To be commercially viable, operators will need to use the aircraft for at least 1,000 flight hours a year. Bain & Company expects aircraft system depreciation to represent the largest cost per eVTOL flight hour.

According to the report, investors can participate in the advanced air mobility market through OEMs, suppliers, infrastructure, air traffic management providers, operators, or mobility services. Future winners will forge a business model well adapted to the constraints of the emerging market and will excel at making the new mode of travel convenient and cost-efficient.

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Editor's Note: For more information or interview requests please contact:

Gary Duncan (London) — Email: gary.duncan@bain.com

Katie Ware (New York) — Email: katie.ware@bain.com

Ann Lee (Singapore) — Email: ann.lee@bain.com

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