Here is the twelfth interview of our series #yourmobilityvision.
#yourmobilityvision is all about showing what the mobility of the future looks like by introducing companies, people behind them, researchers and institutions operating in our truly wonderful sector.
Take your morning flight to the office with a taxi drone? Has your car driven you to work? Or shoot through a vacuum tube in a passenger capsule to the next town? In the near future, all of this could be completely normal. Smart technologies and artificial intelligence will transform our perceptions of mobility, along with our habits. Providing answers to these pressing questions is Kolin’s main task at the Lufthansa Innovation Hub [LIH].
Kolin is committed to identifying new potentially disruptive trends in aviation and in the broader mobility space for the LIH, in order to derive business implications for the broader Lufthansa Group and be ready for a digital and automated future. Focusing on “The New [Sustainable] Transport Economy” – how he terms it – Kolin is passionate about drones and especially air taxis, about which he recently published a data-driven study touching upon trends, technologies and other opportunities in the field of advanced air mobility. We talked to him about this fascinating space.
Aren’t air taxis science fiction? And why is the Lufthansa Innovation Hub putting a focus on this new form of transport?
Air taxis will exist in some form. This can be clearly derived from the figures and data we have evaluated. For example, there are more than 250 companies developing new business ideas and technologies for ‚advanced air mobility‘ – the official term for anything that flies through the air around cities and transports people. Another figure that impressively conveys the importance of this segment is the VC investments. In the first quarter of 2021, investors poured a staggering $2.4 billion into air taxi startups such as Joby Aviation, Archer, and Lilium, largely through SPAC mergers and concurrent PIPE deals. Investment in 2021 marks more than double the $1.1 billion invested in all of 2020. This shows that investors around the world are firmly convinced that this sector has a huge potential to “democratize short-distance air travel”.
In addition, we fundamentally believe that it is also very important, especially in a crisis, to look at innovations and changes in the market. This is where we, as the Lufthansa Innovation Hub, provide important impetus for the time after the crisis. We have to stay on top of current trends so that we don’t lose touch with critical innovations in the long term. Even in times of crisis, firms should not lose sight of innovation, as history suggests that those firms who do will outperform their peers in the long-term, as one of our studies has shown.
Looking at the ongoing developments in the air taxi industry, which trends and dynamics do you currently observe?
The whole air taxi space is currently gaining traction on a lot of different dimensions – VC funding, partnerships, technology – to name only a few. This year it took the space only three months to collect more funding than they did within the entire 2020. Moreover, very prominent players, e.g. United Airlines, entered the air taxi space. Next, we also experience a strong surge in patent applications filed by many startups to protect their critical technologies. For example, Volocopter filed a patent protecting a winged air taxi design that would deliver greater range than its current version and would be a direct attack on the market segment in which Lilium is located. Moreover, the importance of protecting the critical technology is of utmost importance as the IP dispute case between Wisk and Archer Aviation clearly shows.
Talking about IP: Which technologies do you see as the most important ones in the future of air taxis?
Although autonomous driving and flying aren’t coming as fast as most people expected a few years ago, it’s a game-changer. Its influence on operating costs in transport is unrivaled to any transport technology ever developed. It enables a whole set of new mobility offers with a passenger-friendly price structure. Still, autonomous flying air taxis will take years to be ready (or allowed from a regulatory point of view), we will see highly automated systems in the near future as they can already influence the operating cost structure a lot. Autonomous systems will be necessary to build an efficient transport offer. The complexity of a sophisticated advanced air mobility system can’t be handled by humans. The amount and frequency of factors influencing the system are simply too high.
You mentioned the various “systems” and players in the air taxi space. What role do ecosystems play in this regard?
It’s a crucial one. Especially when we talk about a system with different forms of mobility. I’m pretty sure no company can handle the assets, the software, the infrastructure, and the know-how by itself. And let’s not forget the cities themselves that are becoming more and more aware of their responsibility to regulate and influence this type of transport in the cities.
Therefore, many different players need to work together, form partnerships, or cooperate to develop standards. Let’s take infrastructure as an example: it would be hazardous if every air taxi developer comes up with different requirements on infrastructure needs for the air taxi vehicle. This would most likely massively slow down large-scale adoption. Even though I totally understand that current air taxi startups try to come up with their own infrastructure design and requirements as it could become a huge competitive advantage.
We recently published a whitepaper on the AAM ecosystem where we analyzed thousands of data points to map the current advanced air mobility ecosystem, show connections, relationships and identify patterns. We hope that this will contribute to an acceleration of the establishment of a comprehensive and integrated advanced air mobility ecosystem. The paper can be downloaded free of charge on our TNMT.com intelligence platform.
Where do you personally see the biggest opportunities in the air taxi space?
Business-wise, it’s the platform to bring together different forms of mobility and combine them to a passenger-centric and flexible offer for all people with different needs and wishes which is a real alternative to today’s mobility options. I envision it like this: Person A lives in Hamburg downtown and wants to spontaneously visit the sea, which is 80-100km away. Person A opens an app and types in the destination and is then provided with different mobility options, based on price, time or co2 emissions. And the different mobility options are seamlessly integrated with each other – e.g. a taxi or ride-share picks you up at home, takes you to the vertiport, you fly to the sea with an air taxi, and are picked up by a ride-share or use an e-Scooter/train/bus or walk to the beach (the final destination). And all this with only one click of a button, using one application.
But such a platform consists of different building blocks (e.g. the data infrastructure, the mobility services, payment platform, and revenue sharing models) and is very complex as it requires that different travel and mobility players cooperate with each other. And obviously, everyone wants to be the touchpoint with the customer – so it will be very difficult to achieve.
When and where will the first air taxis take off? And what are your hopes for this space?
Test flights on a limited scale with passengers have already taken place. The first commercial operations from the providers‘ point of view will probably start in the middle of the decade. The timeline declarations by these startups are most likely inflated as they underestimate the complexity and capital cost of certification, as well as the technological regulatory, and infrastructure-related hurdles required for mass adoption. All in all, air taxis will remain a relative niche at the beginning.
My hopes are that the current air taxi developers can deliver what they promise. And that this type of mobility really “democratizes short-distance travel”, making it accessible to the majority of our citizens, not only for a few select, high-net-worth individuals. Further, in light of climate change, I hope that air taxis will be used not as an additional mode of transport, but that they will really replace existing mobility offerings (e.g. gasoline cars) to really become a game-changer in multiple dimensions. And I am confident that we can achieve all this, and happy at the same time that we have two German startups leading this space. Exciting times are ahead of us!