Flying taxis: Transport-as-a-service is flying to your neighborhood soon

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  Quantumrun Foresight
• December 9, 2022

Insight summary

Tech companies are racing to launch air taxis, aiming to transform city travel and reduce traffic jams. These electric vertical takeoff and landing aircraft (eVTOL), more accessible and environmentally friendly than helicopters, could significantly shorten daily commutes. This emerging technology could lead to new business models, require government infrastructure development, and revolutionize urban planning.

Flying taxis context

Tech startups and established brands are competing with each other to be the first to develop and publicly release air taxis into the sky. However, while their plans are ambitious, they still have a way to go. A handful of tech companies are scrambling to produce the first commercialized air taxis (imagine drones large enough to carry humans), with funding provided by large companies within the transport industry such as Boeing, Airbus, Toyota, and Uber.

Different models are currently in development, but they are all categorized as VTOL aircraft that do not need a runway to take flight. Flying taxis are being developed to cruise at an average of 290 kilometers per hour and reach an altitude of 300 to 600 meters. Most of them are operated by rotors instead of engines to make them lightweight and quieter.

According to Morgan Stanley Research, the market for autonomous urban aircraft can reach USD $1.5 trillion by 2040. Research firm Frost & Sullivan forecast that flying taxis will have a compound annual growth of 46 percent by 2040. However, according to Aviation Week magazine, it’s likely that mass transportation through flying taxis will only be possible after 2035.

Disruptive impact

Urban air transportation, as envisioned by companies like Joby Aviation, proposes a transformative solution to the escalating problem of ground traffic congestion in major cities. In urban areas like Los Angeles, Sydney, and London, where commuters are mostly stuck in traffic, the adoption of VTOL aircraft could significantly reduce travel time. This shift in urban transportation dynamics has the potential to enhance productivity and quality of life.

In addition, unlike urban helicopters, which have been traditionally limited to affluent segments due to high costs, the mass production of flying taxis could democratize aerial transportation. Drawing technological parallels from commercial drones, these flying taxis are likely to become more economically feasible, broadening their appeal beyond the wealthy. Additionally, the inclination towards electric-powered models presents an opportunity to mitigate urban carbon emissions, aligning with global efforts to combat climate change and promoting sustainable urban development.

Corporations could explore new business models and service offerings, tapping into a market that values efficiency and sustainability. Governments may need to invest in infrastructure development and regulatory frameworks to accommodate and safely integrate VTOL aircraft into urban landscapes. On a societal level, the transition to aerial commuting could reshape urban planning, potentially easing road traffic and reducing the need for extensive ground-based infrastructure. 

Implications for flying taxis 

Wider implications of flying taxis being developed and mass-produced may include:

• Transport/mobility apps and companies offering different tiers of air taxi services, from premium to basic, and with various add-ons (snacks, entertainment, etc.).
• Driverless VTOL models becoming the norm (2040s) as transportation-as-a-service firms try to make fares affordable and save on labor costs.
• A full reassessment of transport legislation to accommodate this new mode of transportation beyond what has been made available for helicopters, as well as funding for new public transport infrastructure, monitoring facilities, and the creation of air lanes.
• Public-sector expense limiting the wide-scale adoption of flying taxis, especially among less developed nations.
• Ancillary services, such as legal and insurance services, cybersecurity, telecommunications, real estate, software, and automotive increasing in demand to support urban air mobility. 
• Emergency and police services may transition a portion of their vehicle fleets to VTOLs to enable faster response times to urban and rural emergencies.  

Questions to consider

• Would you be interested in riding in flying taxis?
• What are the possible challenges in opening airspace to flying taxis?