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Aerial tourism gains momentum as early eVTOL use case

Companies that were once focused exclusively on UAM have started to embrace air tours as their eVTOLs approach commercialization.

Release Date
July 8, 2024
Aerial tourism gains momentum as early eVTOL use case

Every year, tens of thousands of helicopter operations take place at New York City’s Downtown Manhattan Heliport, representing a market that is ripe for disruption by electric vertical take-off and landing aircraft. Yet, the vast majority of these operations — around 90% of them — do not involve shuttling people to the airport or across town, use cases that are now described as urban air mobility. They are instead aerial tours — a niche that publicly traded eVTOL developers, with the exception of China’s EHang, have generally shied away from.

The short shrift given by the eVTOL industry to aerial tourism has a lot to do with total addressable market (TAM) and the narrative required to attract billions of dollars of investment to this emerging sector. Tourism is an established part of the conventional aviation industry, but air tours are a novelty for most people rather than a regular event. By contrast, commuting to work and traveling to the airport are routine activities, and eVTOL companies searching for durable repeat customers have persuaded investors that capturing even a tiny fraction of this massive commuter-driven TAM could yield huge profits.

Related: The daunting economics of taking an air taxi to work

Yet, as eVTOL developers get closer to commercialization, the advantages of tourism as an early use case are becoming more obvious. Unlike commuting trips and airport shuttles, air tours do not rely on perfect timing and the seamless coordination of multiple modes of transport. They do not require accommodations for luggage, and they do not need to be priced competitively with ground transportation. Moreover, they are well positioned to win public acceptance to the extent they can displace noisy helicopter tours, which have faced a growing backlash in New York City and environmentally sensitive national parks.

All of this may explain why eVTOL developers are starting to talk more about air tours — even companies that previously shunned them.

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