How electric air taxis could shake up the aviation industry in the next decade

A world of flying vehicles, like the 1960s sitcom The Jetsons, may be closer than you think.

Companies across the US, including several startups, are developing electric air taxis aimed at taking cars off the road and sending people flying into the air.

Commercial airlines in particular are investing in this type of technology to make journeys to and from the airport shorter and faster for consumers.

In October, Delta Airlines joined the list of airlines supporting EV technology startups, with a $60 million investment in Joby Aviation, a company developing electric vertical take-off and landing aircraft (eVTOLs) intended to operate as an air taxi service.

In 2021, when Joby announced its plan to launch its Uber-like air taxis by 2024, it was criticized by industry analysts for being able to launch by that date. But Delta’s investment in Joby is a five-year partnership to operate eVTOLs exclusively in Delta’s network.

United Airlines is also partnering with a Sweden-based startup, Heart Aerospace, to have electric aircraft flying on regional routes by 2030, adding to two of the airline’s other eVTOL investments. One is for $15 million with Eve Air Mobility for 200 aircraft, and another for $10 million with Archer Aviation for 100 eVTOLs.

American Airlines invested $25 million in Vertical Aerospace, a UK-based company, with an order for 50 aircraft.

As major airlines enter into deals with global startups, it’s important to remember that these are conditional. It depends on the certification of these aircraft and how quickly companies can produce them, said Savanthi Syth, director of equity research, for global airlines and mobility at Raymond James.

Once these aircraft are certified and production begins to ramp up, the potential market size, Syth says, will largely depend on how close companies can get eVTOLs to where consumers are.

“Initially, eVTOLs should replace your personal car,” Syth said. “But it will be different for people, based on where eVTOLs will be.”

Companies envision eVTOLs using existing infrastructure to operate, such as creating “vertistops,” where aircraft land on buildings in urban areas to charge between short distances, or “vertiports,” which use regional airports to transfer between longer distances. charge, about more than 100 miles.

If companies can place vertistops and vertiports close to consumers in residential areas, the market size could be large, Syth said.

“We think you’ll see small amounts [eVTOL] operations will begin in the 2025 timeframe, with certifications hopefully in 2024,” Syth said. “But if you see a lot of planes flying overhead, it’s more likely to be in the 2030s.”

As airlines face cost and availability challenges to become more sustainable, investing in eVTOLs is one of the efforts airlines can try to offset carbon emissions, said Beau Roy, senior managing director at FTI Consulting, which specializes in the aviation industry.

“Airlines don’t have many [sustainable] choices. The biggest option is sustainable jet fuel, but last year maybe one in every 1,000 gallons of jet fuel could be found as SAF,” Roy said. “Airlines are getting aggressive with where else to invest.”

While eVTOLs initially provide airlines with an addition to their ESG portfolio, they also allow them to benefit from replacing long car journeys with a flight option for consumers.

“An interesting use case [of eVTOLs] thinking about getting people out of cars for the 100, 200 or 300 mile trips we make,” Roy said. “Nearly 200 million trips a year are in cars for distances of 100 to 500 miles.”

Roy said airlines are not only taking cars off the road to benefit the environment, but they are also opening the door for consumers to pay for a faster and more efficient alternative to cars.

“Airlines are looking at, ‘How do we get the cost and convenience more widely available to people?’” Roy said. “If it’s cheap enough and the time savings are big enough, people will change their behavior and get out of the car.”

Flying from regional airports from smaller cities is not seen as often anymore across the country, Roy said. Most of the traffic is at the major airports, so airlines can take advantage of emerging technology such as eVTOLs and existing regional airports to grow the industry.

Delta and Joby are planning eVTOLs for initial launch in major cities, such as New York City and Los Angeles.

Ranjan Goswami, senior vice president of Customer Experience Design at Delta, said the company has set its sights on NYC and LA because of the excessive congestion and traffic in these densely populated metropolitan areas, and because of Delta’s prominent position in these markets.

“In the big cities you have the best use cases and the most people to use [an eVTOL] service,” Goswami said. “It’s also where you have economies of scale to ultimately help reach cost for more people.”

Goswami said getting to and from the airport is some of the most stressful parts of travel, and eVTOLs will ease that experience.

“We’re not going to talk to the market about price points now, but we believe it should be an accessible price point,” said Goswami. “Unlike helicopters, which are so expensive, the goal is to make [eVTOLs] accessible and affordable for the traveling public.”

While Roy says he’s optimistic about eVTOLs over the next decade, these air taxis won’t take off as quickly as startups and airlines hope.

In addition to having these aircraft manufactured and then certified, Roy said using existing infrastructure to house eVTOLs is also a hurdle.

If eVTOLs land on rooftops, Roy said, it will take a lot of construction and new infrastructure to convert rooftops into vertistops. With eVTOLs running on electric batteries, these buildings must also generate a lot of power and electricity for charging stations.

“These planes are going to work, and the FAA [Federal Aviation Administration] will do their job to make sure they work,’ Roy said. “It’s just going to take a while to get from where we are to where we need to be.”