CONTINENTAL COMPETITION IN ADVANCED AIR MOBILITY (AAM)
You can find Part One here - 'An Introduction to the Advanced Air Mobility (AAM) Ecosystem', Part Two here - 'Mapping the Advanced Air Mobility (AAM) ecosystem', Part Three here - 'Analysing Advanced Air Mobility (AAM) Investment Strategies I' and Part Four here - 'Analysing Advanced Air Mobility (AAM) Investment Strategies II'.
North America dominates the AAM ecosystem
The air taxi market is a global race. Pre-production aircraft are being flight tested and seeking certification concurrently in Asia, Europe, and North America. This map shows the regional segmentation of the air taxi ecosystem with each node representing an organisation. North America dominates, followed by Europe and Asia.
There’s a good degree of inter-connection between the regions, which bodes well for the long-term health of the industry. The visualisation shows the movement of foreign investment capital into air taxi aircraft manufacturers, and (to a lesser extent) the emergence of cross-border trade flows as supply chain relationships develop. Both Joby Aviation (US) and Lilium (Germany) have supply agreements for composite structures with Japan’s Toray Industries, for example.
Links in this graph represent financial invest- ments, customer/supplier, and partnership connections. As such the diversity of an organisation’s corporate strategy can, to some extent, be inferred from the number of connections it has.
The bottom line
1. Regional leaders
In Europe, the most inter-connected node is Volocopter. Their corporate strategy en- compasses a range of both use cases (passenger transport, logistics, crop spraying) and target markets (Germany / Europe, Japan, Singapore). Their broad partnership strategy is in stark contrast to domestic competitor Lilium, who appear focused solely on passenger transport and in building a vertically integrated business. This ambitious design-build-own-operate ap- proach is in stark contrast to commercial aviation norms.
In North America, Joby Aviation is the most connected node. This is in large part due to their diverse cadre of global investors which includes Abdul Latif Jameel (Middle East), Baillie Gifford (UK), Geely (China), Intel (US), Uber (US), and Toyota (Japan). Their increasingly deep connection with the US Air Force and a long-standing relationship with NASA are also worthy of note.
2. The geopolitics of electric aviation
Fostering the development of an air taxi supply chain, due to its critical technolo- gies, is of strategic importance to national governments. In the US, Joby Aviation and Beta Technologies are supported through initiatives like the US Air Force’s Afwerx / Agility Prime and NASA’s AAM National Campaign that are aiding in certification and testing.
In China, company growth is aided by sign- ing contracts with State-Owned Enterprises (SOEs) that foreign competitors cannot compete for. eHang’s framework agreement with Guangzhou Lingnan International Enterprise Group - encompassing everything from drone delivery and light shows to aerial logistics, sightseeing flights, and passenger transport - is a good example.
Whether the mature aerospace supply chains in Europe that feed into Airbus, Bombardier, and Rolls-Royce can take advantage of the strong cluster of air taxi ex- pertise growing in Germany in the same way, remains to be seen. Certainly, there are projects—especially those involving ADP in France and Deutsche Bahn in Germany— that hold great promise.
Notable by their apparent absence from the sector in any meaningful way are nearly all of Europe’s major automotive groups (Renault Group, BMW Group, JLR Group), with the exception of Daimler who are investors in Volocopter; Stellantis (FCA Group / Groupe PSA), who have just announced a partnership with Palo Alto air taxi startup Archer; and Porsche, who partnered with Boeing to develop a premium flying car.
Perhaps the wild card of the sector are South Korea’s Hyundai who are hoovering up air taxi talent in the US into their Urban Air Mobility division and plan to enter the market with a second-generation vehicle as they reposition the business from car maker to mobility-as-a-service provider.
In the sixth and final excerpt from the whitepaper we explore the patient world of Japanese capital in 'AAM Deep-Dive: the Keiretsu are coming':