eVTOL Aircraft Market

Market Overview

The global eVTOL aircraft market size was valued at USD 327 million in 2023 and is projected to reach USD 2,016 million by 2032, registering a CAGR of 22.4% during the forecast period (2024-2032).  The market is propelled by increasing awareness of the need to decrease carbon emissions, decreasing aircraft operating costs, and a growing demand for urban air mobility.

An electric vertical takeoff and landing (eVTOL) aircraft is propelled by electricity and provides practical and expedited services. An electric vertical takeoff and landing (eVTOL) aircraft is regarded as an advanced mode of transportation that offers enhanced safety and many advantages. Some additional benefits of eVTOL aircraft are shortened travel times, the ability to safely transport passengers in distant locations, and their high environmental friendliness, resulting in reduced carbon emissions. 

Electric vertical takeoff and landing aircraft are the future of travel, offering safety, quietness, cleanliness, and electric propulsion. The market for this aircraft is influenced by reasons such as increasing awareness of carbon footprint reduction, decreasing aircraft operating costs, and a growing need for urban air mobility. The ever-increasing requirement for contemporary transportation techniques and aircraft that produce less noise will expedite the worldwide demand for advanced electric vertical takeoff and landing (eVTOL) aircraft.

Highlights

• Air taxis generate the highest revenue share based on fusion type.
• Lithium-ion batteries account for the largest market share by propulsion type.
• Vectored thrust accounts for the largest market share by lift technology.
• Piloted generates the highest revenue share based on the mode of operation.
• 200-500 Km accounts for the largest market share by range.
• <250 Kg generates the highest revenue share based on Maximum Takeoff Weight (MTOW). 

Market Dynamics

Global eVTOL Aircraft Market Drivers:

Improving Technologies in Batteries

Advancements in battery, motor, and power electronics technologies act as a driving force for the market expansion. Advancements in battery technology, including improvements in energy density and faster charging capabilities, allow EVTOL aircraft to fly greater distances and recharge more quickly. This makes them more practical and commercially attractive. 

Lithium plays a crucial role in the eVTOL business, particularly in using lithium-ion batteries, which provide power for these advanced vehicles. Lithium-ion batteries are renowned for their outstanding energy density, making them highly sought-after in several fields, such as electric vehicles, consumer electronics, and solar power storage. The US Department of Energy has declared a USD 3.5 billion initiative to enhance the domestic battery supply chain. The program seeks to establish a self-sufficient supply chain within the country and decrease reliance on foreign sources, especially considering the rising need for lithium batteries. It is estimated that the need for these batteries will increase ten times by 2030, driven by technological improvements and the expanding market potential of EVTOL aircraft.

Advancements in Electric Motors

The development of electric motors, characterized by enhanced power-to-weight ratios and improved efficiency, significantly enhances aircraft performance. This progress allows EVTOLS to achieve more effective takeoff, hover, and maneuverability. Electric motors play a crucial role in eVTOL design, with each aircraft typically equipped with at least six motors. These motors must be lightweight yet capable of meeting the substantial power requirements during takeoff and landing.

Currently, researchers are investigating axial flux (also known as 'pancake') motors, which provide a power density 3 to 4 times greater than the radial-flux motors commonly used in cars. Minimizing the aircraft's weight is essential to optimize its range and payload capacity. Carbon fiber composites are the preferred materials, providing numerous possibilities for manufacturers. In April 2024, Japan's Nidec Motor Corporation would be responsible for creating an electric motor specifically designed for the Air One personal eVTOL aircraft. The research aims to develop a motor that can sustain flights of up to 100 kilometers without requiring additional charging. The project is being funded by the BIRD Energy program of the BIRD Foundation (Israel-U.S. Binational Industrial R&D Foundation) to assist renewable energy efforts. The specific amount of financing has not been disclosed.

Global eVTOL Aircraft Market Restraints:

eVTOL Aircraft Crash Because of Failure in Software

Software faults leading to EVTOL aircraft crashes significantly hinder the growth of the EVTOL market. Using intricate software systems for flight control and autonomous operations creates a significant risk, as software malfunctions or faults might result in catastrophic mishaps. These occurrences could erode public confidence in the safety and dependability of EVTOLS, hindering the expansion of the market and the granting of regulatory licenses.

Therefore, to alleviate the issues related to software failures, it is necessary to implement rigorous testing, certification processes, and strong safety measures due to the possible hazards involved. By addressing these problems and implementing rigorous software development techniques, such as comprehensive testing, redundancy, and fail-safe mechanisms, EVTOL makers can improve the safety and reliability of their aircraft. This will help alleviate concerns and drive market acceptance.

Global eVTOL Aircraft Market Opportunity:

Strategic Developments 

Strategic advancements have favorable prospects for the EVTOL market. The formation of strategic collaborations and partnerships among technology companies, aerospace manufacturers, and transportation service providers allows for the consolidation of knowledge, resources, and networks, which in turn expedites the progress and commercialization of EVTOLS. These collaborations promote creativity, improve the ability to conduct research and development and propel progress in technology, regulatory frameworks, and infrastructure.

On June 14, 2023, Eve Air Mobility and United Airlines announced their collaboration to initiate commercial eVTOL flights in California's San Francisco Bay Area. The news signifies the two organizations' initiation of various joint endeavors to introduce commuter services to the region, involving identifying prospective route networks and destination locations. In 2022, Eve and United established a partnership. United invested USD 15 million in Eve and also inked a conditional purchase deal for 200 eVTOL aircraft, with the possibility of acquiring an extra 200 aircraft.

Furthermore, making strategic investments in EVTOL start-ups and setting up specific test sites and vertiports helps to produce a favorable environment for the implementation of EVTOL. In addition, the market potential is boosted by the backing of governments and regulatory agencies through favorable policies, subsidies, and incentives. Strategic advancements promote a cooperative and encouraging atmosphere, allowing the EVTOL Market to thrive and unleash its complete potential as a revolutionary type of transportation.

Regional Analysis

Europe Dominates the Global Market

The global eVTOL aircraft market analysis is conducted across North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Europe is the most significant global eVTOL aircraft market shareholder and is estimated to grow at a CAGR of 22.4% over the forecast period.  During the forecast period, Europe is expected to experience the highest growth rate in the eVTOL Aircraft market. This is due to several factors contributing to the region's potential for growth. The area has experienced substantial economic growth, leading to an increased demand for air travel and a growing commercial aviation industry. The growing focus on sustainable aviation practices and the rise of urban air mobility and advanced air mobility solutions will increase the electric vertical takeoff and landing (VTOL) aircraft market.

Additionally, several burgeoning economies, like France, the UK, and Germany, have made substantial investments in their European aircraft industries. Europe's dominance in the eVTOL Aircraft market is due to prominent regional aircraft manufacturers and suppliers. The SESAR 3 Joint Undertaking (SESAR-JU) is a European collaborative effort, including business and public sector partners. Its purpose is to expedite the implementation of the Digital European Sky through research and innovation. SESAR is actively utilizing, advancing, and expediting state-of-the-art technology solutions to control traditional aircraft, drones, air taxis, and vehicles at greater heights.

North America is anticipated to exhibit a CAGR of 22.6% over the forecast period. The rapid growth of North America can be attributed to the prominent manufacturers in the region, including Joby Aviation, Bell Textron Inc., Kitty Hawk, and other companies based in the United States. Furthermore, the increasing expenditure from the US government in advancing VTOL aircraft is anticipated to drive market expansion. 

Asia-Pacific will likely show significant growth in the eVTOL aircraft market due to the region's expansion of aviation services. China and Japan are the most critical contributors to developing the eVTOL aircraft market in the Asia-Pacific. 

Segmental Analysis

The global eVTOL aircraft market is segmented based on fusion type, type, technology, and mode of operation. 

The market is divided into Air Taxis, Delivery Drones, and others based on fusion type. 

The Air Taxis segment dominated the market in 2023 due to the growing development of air taxi services. The growing utilization of autonomous vehicles for delivering items without human involvement has sparked an increased interest in autonomous last-mile delivery. Reduced travel distances result in fewer points of contact, while faster transportation times between UPS sites facilitate the growth of segments.

Delivery drones, which can take off and land vertically using electric power (eVTOL), provide numerous benefits. Firstly, they offer expedited and effective delivery services, resulting in significantly shorter transit times than conventional ground-based systems. In addition, electric vertical takeoff and landing (eVTOL) drones can mitigate traffic congestion and decrease carbon emissions, thereby fostering a more sustainable urban setting. Furthermore, their independent functioning decreases staff expenses and enhances operational adaptability.

Based on propulsion type, the market is segmented into Solid-State Batteries, Lithium-Ion Batteries, and Hydrogen Fuel Cells.

The lithium-ion batteries segment dominated the market in 2023 due to its advantages, including enhanced discharge and charge efficiency, extended lifespan, and the ability to deep cycle while sustaining power, which is highly beneficial. LiFePO4 batteries sometimes have more extraordinary initial expenses but significantly reduced long-term costs. eVTOL aircraft are a prudent and durable choice since they require minimal upkeep and boast an extensive lifespan, significantly benefiting market expansion.

Hydrogen fuel cells are advantageous for electric vertical takeoff and landing (VTOL) aircraft because they have a high energy density and can be refueled quickly. Fuel cells enhance the sustainability of aerial transportation by generating energy through the interaction of hydrogen and oxygen, resulting in increased flying range and less environmental effect.

The market is segmented by lift technology into Multirotor, Lift Plus Cruise, Vectored Thrust, and others. 

The segment's growth is expected to be driven by the attributes of this technology, including its high durability and improved efficiency. Moreover, this thrust vectoring technology offers two supplementary advantages: vertical takeoff and landing (VTOL) capability and enhanced maneuverability. In addition, they facilitate accelerated rotation, decelerated rotation, reduced takeoff velocities, increased descent velocities, and decreased approach velocities.

Multirotor configurations in electric vertical takeoff and landing (eVTOL) vehicles provide improved maneuverability and stability, essential for urban air mobility. These aircraft employ many rotors to provide vertical lift and precise control during flight, enabling safe operations in limited places and urban environments. As a result, they contribute to the advancement of aerial transportation viability.

Based on the mode of operation, the market is segmented into Piloted Autonomous and Semi-Autonomous.

Piloted held the most significant segment share in 2023. The main reason for this growth is the increasing adoption of artificial intelligence (AI), virtual reality (VR), and the Internet of Things (IoT) in eVTOL technology. Moreover, Optionally Piloted vehicles effectively decrease the occurrence of crashes, traffic congestion, pollution, and energy usage while enhancing lane capacity.

The semi-autonomous segment is the fastest-growing segment during the forecast period due to the rising investments made by government agencies and businesses in the research and development of semi-autonomous electric vertical takeoff and landing aircraft.

Based on the range, the market is segmented into 0-200 km and 200-500 km.

The 200-500 km segment dominated the market in 2023. The segment's rise can be attributed to the increasing demand for long-range vertical takeoff and landing aircraft for intercity travel.

The 0-200 km segment is the fastest growth segment due to the increasing implementation of sort-range drones. Moreover, rising demand for urban air mobility for intracity commute is also expected to drive the market growth.

Based on Maximum Takeoff Weight (MTOW), the market is segmented into <250 kg, 500-1500 kg, 250-500 kg, and >1500 kg.

The <250 kg segment dominated the market in 2023 due to the growing adoption of small VTOL aircraft for commercial applications like delivery services.

The 250-500 kg segment is the fastest growing owing to the rising demand for close-range and short-range eVTOL vehicles.

Recent Developments

• March 2024 –Airbus Defence and Space made a deal to purchase INFODAS, a German firm in Cologne specializing in cybersecurity and IT solutions for the public sector, including defense and critical infrastructures. The deal's completion is contingent on the usual regulatory authorizations and is anticipated to be concluded before the conclusion of 2024.
• March 2024 – The EUTELSAT 36D geostationary telecommunications satellite, manufactured by Airbus, was transported from Toulouse, France, to Sanford, Florida, USA, using an Airbus BelugaST (A300-600ST) aircraft. The subsequent phase involves transporting it to the Kennedy Space Center in Florida, where it will be sent into orbit via a SpaceX Falcon 9 rocket later this month. The new BelugaXL, built on the larger A330-200 platform, means that the A300-600-based BelugaST fleet is now entirely accessible for transporting oversized cargo worldwide.