The term urban air mobility (UAM) stands for a new mobility or for new mobility concepts and the large-scale expansion of urban mobility into the air. The aim is to create a safe, environmentally friendly and efficient transport system and to relieve congested infrastructures, especially in fast-growing urban areas. Automated flying objects are to transport passengers (urban air mobility) or freight (urban air logistics) at low altitudes. What seemed like a remote possibility a few years ago is now commonly referred to as urban air mobility: The shift of mobility into the so-called “third dimension” or the development of airspace in urban areas.
Depending on the area of application, a distinction is made between different aircraft or air vehicles. Unmanned aircraft used in urban air logistics are commonly referred to as cargo drones or unmanned aircraft systems (UAS). In the area of passenger transport, reference is made to VTOL (electric vertical take-off and landing) or air taxi which is now a commonly used term. A reliable legal framework is crucial for the successful economic development and implementation of the entire urban air mobility market. This must include standards for technological certifications and approvals, to ensure the safety of the required infrastructure and measures for the regulation of the urban (unmanned) air mobility market.
The Urban Air Mobility Market
The relevance of urban air mobility can be seen in statistical data and market development as well as in simple examples - economically, urban air mobility is (rightly) considered a future market with great market potential. By 2030, approximately five billion people will live in cities and urban regions. This corresponds to around 60 percent of the entire world population and is accompanied by immense challenges for the infrastructure in urban areas.
The consulting firm Roland Berger assumes that the number of drones used as air taxis, airport shuttles and as part of inner-city flight services (i.e. in terms of the urban air mobility market in the narrower sense) will grow exponentially in the next few years - to almost 160,000 autonomous electric drones worldwide by 2050, with an associated annual turnover of almost 90 billion USD. The market potential is also highly estimated by investors. In a study published at the end of 2020, Roland Berger assumes that around 907 million USD was invested in the industry in the first half of 2020. This would mean that the investment sum would have increased more than twenty-fold in four years compared to 2016. The auditing and consulting firm Deloitte also includes freight and commercial intercity services (advanced air mobility or AAM) in its market forecast and assumes that the US market for AAM could reach a volume of 115 billion USD by 2035.
Market participants and required infrastructure
In addition to globally active companies from the traditional aviation sector, such as Airbus and Boeing, a large number of start-ups (some of them very small) are working worldwide on the implementation of UAM concepts. These include Volocopter, Lilium, EHang or Joby Aviation.
The fact that companies from the urban air mobility sector are increasingly in the focus of public interest and investors is also demonstrated by the fact that AHK France gave an award to Volocopter in February 2023 for its innovative urban air mobility concept. Electric air taxis are to be used on a trial basis at the 2024 Olympic Games in Paris.
Urban air mobility can only be successful and realise its full potential if the new concepts are integrated into urban mobility. This is only possible with suitable infrastructure and corresponding interfaces. The airspace structure must be adapted to the new developments. In particular, a suitable ground infrastructure must be designed and take-off and landing zones created, the number of which facilitates profitable implementation of the new mobility concepts. Strategic partners who provide the necessary infrastructure, in this case vertiports, are also crucial for the use of air taxis at the Olympic Games. This already shows that the urban air mobility sector does not just incorporate companies that develop AUS and VTOL, in addition, the sector includes
- Drone operators who use drones to provide services or transport goods or people;
- Manufacturers of the drone hardware and manufacturers of other payloads for installation in drones, e.g. for filming, inspection, cargo, surveillance or measurement purposes;
- Platform technology providers developing equipment and software systems for communication, flight control, situational awareness or to enable autonomous operation;
- Dealers who sell or rent ready-made drones to third party companies;
- Ground infrastructure operators such as vertiports and airports, air traffic management providers (e.g. providers of air traffic control services, U-space services or shared information services); and
- Telecommunications infrastructure providers and navigation and surveillance infrastructure providers.
Legal framework and continuous monitoring of legal development as a competitive advantage
Following the Commission’s 2015 Aviation Strategy, the EU has developed a comprehensive regulatory framework for drones. Since 2018, all drones, regardless of their weight, are subject to harmonised safety rules for drone operations. To ensure safe drone operations in the airspace, the Commission also adopted several regulations regarding the air traffic management system for drones. These include Commission Implementing Regulation (EU) 2019/947 and Commission Delegated Regulation (EU) 2019/945, which set out detailed rules and procedures for the operation of unmanned aircraft and established requirements for the design and manufacture of unmanned aircraft systems.
The European Union published a new drone strategy (Drone Strategy 2.0) in November 2022, presenting a plan for a European drone market. By 2030, deliveries of medicine, emergency services and innovative air mobility services (air taxis) with (autonomous) drones should be part of everyday life in Europe. The Strategy contains 19 operational, technical and financial flagship actions. The aim is to create a suitable legal and commercial environment for the airspace and market for drones and to pave the way for large-scale commercial flight operations
Greater relief for urban road traffic inevitably goes hand in hand with increased urban airspace pollution. In addition, various regulatory and infrastructural obstacles exist. Certifications and clear regulations for traffic in the airspace above cities must ensure that safety is provided and that there is no overlap with commercial air traffic (aircraft). Despite technological progress, the mobile network is not efficient enough to guarantee seamless radio communication, which would be essential for a nationwide infrastructure network of unmanned, autonomous drones. Infrastructural hurdles exist due to the lack of charging stations, landing strips, no-fly zones, no-fly times and maintenance facilities. In addition, so-called error mode management programmes for error and accident prevention must be further developed together with IT solutions in order to rigorously prevent the hacking of drones and accidents in general. Not least against the background of a multitude of diverse interests and risks in the development of this market, the question of designing a comprehensive legal framework for urban air mobility arises. Similar to the creation of a national space law, which can create one of the basic prerequisites for the economic success of an industry and generate clear locational and competitive advantages through reliable legal framework conditions, it is also decisive in the field of urban air mobility who acts first in creating a legal framework and, if necessary, can secure critical competitive advantages in the competition for shares on the global market. This legal framework must include standards for technological certifications and approvals, for the security of the required infrastructure coupled with measures to regulate the UAM market.
Regulations for certification and, in particular, the definition of requirements and regulations for type certification are set down by the European Union Aviation Safety Agency (EASA) and the American Federal Aviation Administration (FAA). In June 2022, EASA was the first agency worldwide to publish draft rules for the operation of air taxis in cities. The draft covers airworthiness, flight operations, flight crew licensing and air traffic regulations. The proposals clarify the basic certification path that may apply to developers in Europe for VTOLs in the future. The fact that this is a first mover advantage with real effects is demonstrated by the fact that the UK has already adapted the regulations proposed by EASA, thus giving its own companies and companies on the continent advantages in the expansion phase. The European Commission will review the EASA regulatory framework in 2023 and take a final decision on this. The situation is different, however, for autonomous, i.e. pilotless personal air vehicles (PAV). Here, the development of certification regulations is still pending.
With regard to the standardisation of infrastructure requirements (concerning equally vertiports as well as the aspect of air traffic control), the Commission had adopted the “U-space” package in mid-2021. U-space (“U” stands for unmanned services) is a European system developed for the management of drone traffic. The package includes three regulations that together are intended to create the conditions for both drones and manned aircraft to operate safely in the part of the airspace designated as U-space. The new rules are primarily intended to facilitate more complex and longer missions, particularly in low and densely populated airspace and beyond the visual range of the remote pilot. The EU rules came into force on 26 January 2023. Member States can now designate a specified airspace as U-space. Certain mandatory services must be provided in this space. The overall objective is to create a competitive market with fair access for AUS operators.
The EASA published specifications for the construction of vertiports in March 2022. The next step is to develop a complete legal framework for the construction and certification of vertiports as well as for the operation and supervision of operators. The FAA has followed suit here and published so-called Vertiport Design Standards in September 2022.
With regard to the regulation of the UAM market itself, it remains to be seen how this market will develop. Economic theory primarily names external effects, information asymmetries and the existence of natural monopolies as reasons for market regulation. Market developments will show whether and to what extent regulation as in other transport sectors will be necessary.
Framework conditions in Germany
With the aim of creating reliable regulatory framework conditions, the Federal Ministry of Transport and Infrastructure (BMVI) adopted a Memorandum of Understanding with the Urban Air Mobility model cities of Aachen, Hamburg, Ingolstadt and Northern Hesse in June 2021 to implement and further develop innovative drone technology. The innovation network is intended to provide infrastructural and regulatory solutions through best-practice examples and to test the acceptance of the population (Link). The EU’s UAM initiative, funded ideas and project outlines with 29 million Euros (2019) to support research and testing related to Urban Air Mobility. Since 2021, the BMVI has continued this funding guideline and will provide around 11 million Euros for the “Innovative Air Mobility” initiative until 2023. The Federal Ministry of Digital Affairs and Transport has also established a digital platform for unmanned aviation. The Digital Platform for Unmanned Aerial Vehicles (dipul) provides all safety-relevant and legal information on the use of drones in Germany.
It remains to be seen in what form urban air mobility will or can play a role in the space strategy announced for the autumn.
Outlook
Europe has legally, technically and infrastructurally valid opportunities to succeed in the field of urban air mobility, but considerably lags behind especially Asia and the Middle East. This gap must be closed in order to accelerate technical and economic development. The dynamic and complex subject area requires constant developments, innovations and investments with clear legal and regulatory framework conditions. Above all, market players are required to monitor the legal and regulatory framework conditions and to continuously re-evaluate business opportunities in the face of changing requirements. Politicians are called upon to rigorously implement the industry’s requirements for reliable legal and regulatory framework conditions in order to create a competitive European location for all urban air mobility companies in the long term.
