Advanced Air Mobility Market Size & Outlook, 2025-2033

Advanced Air Mobility Market Size

The global advanced air mobility market size was valued at USD 2,365.87 million in 2024 and is expected to grow from USD 2897.48 million in 2025 to reach USD 14664.2 million by 2033, growing at a CAGR of 22.47% during the forecast period (2025-2033).

Advanced Air Mobility (AAM) represents a groundbreaking shift in transportation, harnessing innovative aerial technologies such as electric vertical takeoff and landing (eVTOL) aircraft, drones, and autonomous flying vehicles. AAM is set to revolutionize how goods and people move by offering faster, more efficient, and environmentally friendly alternatives.

This includes Urban Air Mobility (UAM), which focuses on the movement of people and goods within cities or between nearby urban areas, and Regional Air Mobility, addressing longer-distance transportation needs. By leveraging these technologies, AAM is expected to reduce ground congestion, cut travel times, lower emissions, and make air transportation more accessible to a broader population.

The AAM market is rapidly evolving, driven by technological advancements, growing urbanization, and a rising demand for sustainable transportation solutions. As the market continues to develop, the integration of electric aircraft, autonomous systems, and innovative air traffic management solutions is expected to propel the industry toward substantial growth, reshaping the future of both urban and regional transportation.

Source: Straits Research

Latest Market Trends

Increasing Adoption of Evtol for Urban Air Mobility (uam)

The demand for electric vertical takeoff and landing (eVTOL) aircraft is rising as urban areas seek efficient and sustainable transportation solutions. eVTOL aircraft offer a cost-effective, zero-emission alternative to traditional ground transport, addressing traffic congestion and reducing carbon footprints. To drive commercialization and overcome regulatory challenges, industry leaders are investing heavily in research, development, and strategic partnerships.

• For instance, in September 2024, Joby Aviation announced its plans for a public service debut in 2025 after successfully completing its first production prototype, eVTOL, for the FAA's certification program.

Emergence of Hydrogen-Based Propulsion Systems

Hydrogen-powered propulsion is emerging as a key solution for extending flight range and enhancing sustainability in the AAM sector. Compared to battery-electric systems, hydrogen fuel cells offer higher energy density and longer flight durations, making them particularly suited for regional air mobility applications. With stricter environmental regulations pushing the industry toward greener alternatives, major players are increasingly exploring hybrid and hydrogen-based propulsion technologies.

• For example, in November 2024, Vertical Aerospace partnered with ZeroAvia to integrate hydrogen-electric propulsion systems into its aircraft, aiming to reduce operational costs and emissions while enhancing flight performance.

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Advanced Air Mobility Market Growth Factors

Rising Demand for Sustainable Urban Transportation

With rapid urbanization and worsening traffic congestion, cities are increasingly turning to Advanced Air Mobility (AAM) solutions as a cleaner, faster alternative to traditional transport. AAM systems, particularly electric vertical takeoff and landing (eVTOL) aircraft, offer zero-emission mobility, aligning with global sustainability goals. Governments and regulatory bodies are actively promoting green technologies and investing in sustainable infrastructure to accelerate adoption.

• For instance, the European Union launched the SESAR AAM program in 2024, committing €450 million to develop and integrate sustainable air traffic management solutions across urban centers.

Technological Advancements in Autonomy and Artificial Intelligence

The integration of AI and autonomous systems is transforming AAM operations, enhancing safety, efficiency, and scalability. Advanced navigation, real-time data processing, and AI-powered collision avoidance systems are making autonomous eVTOLs a viable solution for both passenger and cargo transport. By reducing human error and increasing operational reliability, AI-driven solutions are paving the way for the widespread deployment of autonomous air mobility.

• For instance, in December 2024, Archer Aviation unveiled its autonomous flight navigation system designed for its Midnight eVTOL, emphasizing enhanced safety and reduced pilot dependence.

Market Restraint

Regulatory Challenges with High Initial Development and Operational Costs

The lack of standardized regulations and lengthy certification processes are major barriers to global advanced air mobility market growth. Compliance with safety standards, airspace integration, and pilot certification requirements are complex and time-intensive. These regulatory bottlenecks delay market entry and pose challenges for startups and new entrants.

Moreover, developing AAM solutions involves substantial investments in R&D, infrastructure, and vehicle production. The high upfront costs limit market entry for smaller players and startups, creating an entry barrier that only well-funded organizations can navigate. However, as technologies mature, costs are expected to decline, paving the way for broader adoption.

Market Opportunity

Integration with Smart City Infrastructure

The integration of Advanced Air Mobility (AAM) systems with smart city initiatives is revolutionizing urban transportation by enhancing connectivity, efficiency, and sustainability. Smart cities are incorporating advanced air traffic management systems, IoT-powered technologies, and AI-driven analytics to optimize AAM operations.

Key developments such as vertiports, charging hubs, and digital airspace management solutions are accelerating AAM adoption. Therefore, governments, urban planners, and private stakeholders are increasingly collaborating to build the necessary infrastructure, ensuring seamless integration with existing transportation networks.

• For example, in 2024, Skyports Infrastructure partnered with the City of Los Angeles to develop vertiport infrastructure for urban air mobility (UAM) services, aiming to launch commercial operations by 2026.
• Similarly, Singapore's Urban Redevelopment Authority announced plans to integrate AAM corridors into its smart city framework, facilitating air taxi operations by 2028.

As smart city initiatives expand globally, the synergy between urban air mobility and connected infrastructure will unlock new opportunities, driving the growth and commercialization of AAM solutions.

Regional Insights

North America dominates the global advanced air mobility market, driven by its advanced aviation infrastructure, significant research and development (R&D) investments, and strong regulatory framework. The U.S. leads the charge, serving as a global hub for eVTOL and autonomous aviation advancements.

Moreover, government initiatives, strategic partnerships, and private-sector funding are accelerating the commercialization of AAM technologies. The region's well-established aerospace ecosystem fosters innovation, making it a prime market for early adoption.

For instance, in 2024, the FAA granted Joby Aviation the first Special Airworthiness Certificate for its eVTOL prototype, marking a major milestone in regulatory approval. Likewise, Archer Aviation secured partnerships with major U.S. airlines, further solidifying North America's leadership in AAM.

Canada's Market Trends

Canada is advancing in the AAM market through its strong aerospace sector and focus on sustainability. Companies like Horizon Aircraft and Bell Textron Canada are leading innovations in hybrid-electric and eVTOL aircraft. In 2024, Transport Canada issued new guidelines for integrating eVTOLs into national airspace, accelerating adoption. The country's expansive geography and emphasis on regional connectivity make it a key player in AAM deployment.

Asia-Pacific's Market Trends

Asia-Pacific is the fastest-growing AAM market, fueled by rapid urbanization, increasing population density, and substantial investments in smart city infrastructure. Countries like China, India, and South Korea are integrating AAM solutions to address traffic congestion and enhance regional mobility. Moreover, governments are actively supporting the sector through policy frameworks and local manufacturing initiatives, ensuring long-term growth.

For instance, in September 2024, South Korea launched its K-UAM Grand Challenge program to integrate eVTOLs into urban transport by 2030.

India's Market Trends

India’s AAM market is gaining momentum with government initiatives aimed at improving urban mobility and reducing congestion. Startups like The ePlane Company are developing compact eVTOL aircraft suited for crowded urban areas. The Ministry of Civil Aviation’s push for drone and eVTOL integration is fostering growth. In 2024, India announced plans for pilot testing urban air mobility systems in Bengaluru and Hyderabad, focusing on last-mile connectivity.

China's Market Trends

China is one of the fastest-growing AAM markets globally, supported by its booming urban population and government-backed technological advancements. Leading companies like EHang and AutoFlight are developing passenger and cargo eVTOL solutions. In 2023, EHang received type certification for its EH216-S, allowing commercial operations in select cities. China's rapid digital transformation and investments in smart city infrastructure bolster its AAM capabilities.

Japan's Market Trends

Japan's AAM market is rapidly growing, driven by its focus on urban connectivity and robotics. With government-backed programs like the “SkyDrive Initiative,” Japan is developing a comprehensive framework for urban air mobility solutions. Companies like SkyDrive and Honda are pioneering lightweight eVTOLs tailored for congested cities. In 2024, SkyDrive secured approval for test flights in Tokyo, marking significant progress toward commercial deployment by 2025.

South Korea's Market Trends

South Korea is emerging as a regional leader in AAM, supported by its advanced manufacturing and technology sectors. The government’s "K-UAM Grand Challenge" aims to integrate eVTOLs into the country’s transport infrastructure by 2030. Hyundai Motor Group is leading efforts with its Supernal eVTOL division, focusing on urban and suburban air mobility. In 2024, South Korea began building vertiports in Seoul, a crucial step toward operational readiness.

United States's Market Trends

The United States is at the forefront of the advanced air mobility market due to its strong aviation infrastructure and leadership in eVTOL development. Companies like Joby Aviation and Archer Aviation are advancing cutting-edge technologies to enable urban air mobility. Federal support, including FAA certifications and public-private partnerships, further accelerates the market. In 2024, the FAA approved the first operational airspace framework to integrate eVTOL aircraft, cementing the U.S. as a global leader in AAM development.

Germany's Market Trends

Germany is a major player in the AAM market, leveraging its robust automotive and aerospace sectors to innovate in electric propulsion and urban air mobility solutions. Companies like Volocopter and Lilium lead the charge with advanced eVTOL aircraft designed for urban and regional mobility. In May 2024, Lilium secured funding to develop its Vertiport infrastructure, aiming for commercial operations by 2026.

U.k.'s Market Trends

The U.K. is a leader in the European AAM market, supported by government funding and private sector innovation. Companies like Vertical Aerospace are pioneering all-electric eVTOL designs for urban transport. In 2024, the U.K. government announced a £125 million investment in vertiport infrastructure and AAM research, reinforcing its commitment to sustainable mobility. The U.K.’s aerospace expertise and regulatory foresight make it a hub for AAM development.

Vehicle Type Insights

The eVTOL (electric vertical takeoff and landing) segment dominates the global market, generating the highest revenue. Its dominance is driven by advancements in battery technology, increasing urban air mobility initiatives, and growing investments from aerospace giants. eVTOLs offer a sustainable alternative to traditional air transport, reducing carbon emissions and noise pollution. Their versatility in urban and regional transportation makes them the preferred choice for future air mobility solutions.

Mode of Operation Insights

The piloted segment leads the global market, accounting for the highest revenue. While autonomous aircraft are gaining attention, piloted eVTOLs remain the dominant choice due to regulatory approvals, safety concerns, and passenger trust. Many early deployments focus on piloted operations to ensure controlled and safe integration into urban airspace. This segment benefits from well-established aviation standards and paves the way for gradual autonomous adoption.

Applications Insights

The passenger transport segment holds the highest market share in advanced air mobility, fueled by the rising demand for urban air mobility. Cities worldwide are exploring eVTOLs as a solution to traffic congestion, offering efficient and time-saving travel. Therefore, major industry players are developing air taxi services to revolutionize short-distance transportation. With increasing public and private investments, passenger transport is set to drive the widespread adoption of AAM technology.

Propulsion Type Insights

The fully electric propulsion segment leads the AAM market due to its eco-friendly nature and technological advancements. As governments push for carbon-neutral transportation, eVTOL manufacturers focus on improving battery efficiency, reducing costs, and enhancing range. The absence of fuel dependency lowers operational expenses, making electric propulsion the preferred choice for sustainable urban air mobility. Its potential to revolutionize short-haul travel further strengthens its market dominance.

Company Market Share

Key market players are investing in advanced air mobility technologies and pursuing strategies such as collaborations, acquisitions, and partnerships to enhance their products and expand their market presence.

Archer Aviation: An Emerging Player in the Global Advanced Air Mobility Market

Archer Aviation is quickly becoming a prominent player in the AAM market, focusing on developing all-electric eVTOL aircraft. The company is leveraging innovative design, efficient manufacturing, and strategic partnerships to position itself as a key competitor in urban air mobility. Archer’s flagship aircraft, “Midnight,” targets short-distance urban travel with low noise and zero emissions, aligning with global sustainability goals.

Recent Developments by Archer Aviation:

December 2024 - Archer Aviation secured a $200 million investment to expand its manufacturing capabilities and advance FAA certification for Midnight, aiming for commercial operations by 2025.

List of key players in Advanced Air Mobility Market

1. Joby Aviation
2. Archer Aviation
3. Lilium GmbH
4. Volocopter GmbH
5. EHang Holdings Limited
6. Vertical Aerospace
7. Hyundai Motor Group (Supernal)
8. Beta Technologies
9. Textron Inc. (Bell Textron)
10. Embraer S.A. (Eve Air Mobility)

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Recent Developments

• November 2024 – Volocopter partnered with SEA Milan Airports to launch its first commercial eVTOL routes in Italy, scheduled to begin operations in 2026. As part of the partnership, Volocopter will leverage SEA Milan’s infrastructure expertise to construct vertiports designed for seamless passenger experiences.
• October 2024 – EHang announced its first commercial pilot program for the EH216-S in Guangzhou, paving the way for scaled deployment across Chinese cities. The program is a landmark achievement, marking a significant step toward integrating autonomous eVTOL aircraft into urban transportation networks. The EH216-S, a fully electric, two-passenger drone capable of autonomous operation, has already received regulatory-type certification in China.

Analyst Opinion

As per our analyst, the global advanced air mobility market is set for substantial growth, driven by the integration of cutting-edge technologies like eVTOL aircraft and hydrogen propulsion systems. The increasing trend of urbanization and the growing need for efficient, sustainable transportation are reshaping mobility in major cities, while AAM solutions effectively address issues such as congestion and carbon emissions.

However, challenges remain, including the high initial investments required for infrastructure development and navigating complex regulatory landscapes. Despite challenges, ongoing advancements in battery technology, autonomy, and vertiport infrastructure are opening up significant opportunities for growth.

The market's momentum is expected to accelerate as industry collaborations and government support continue to drive the widespread adoption of AAM technologies worldwide, further solidifying its role in the future of urban air mobility.