Skyways to the Future 2024

Rising utilities costs, labour costs and other operational expenses, including the network consumption cost, will influence operational costs associated with AAM operation in India. Compared to other modes of transport, AAM provides the advantage of lower operational costs, as the fossil fuel rates will continue to rise. The labour costs, however, will add to the operational costs compared to the conventional mode of transport in India. The current shortage of commercial pilots, combined with high demand, is expected to drive salaries even higher. Currently, the average year- over-year increase in salaries of commercial pilots is around 8%, while the median salary ranges between $12,000-28,000 (INR 1-2.4 million) annually in India. Technical ramifications: Dealing with diverse market segments will impact the nature of service and form factor, among other things. Urban corridors may need agile, smaller and swifter fleets, while regional fleets may require robust vehicles capable of handling longer commutes and heavier loads. This fleet diversification will require investment in research, manufacturing and operational infrastructure. –Energy and charging infrastructure: Urban eVTOL services will demand high-speed charging facilities to support frequent flights. These hubs should be located near business districts or other key urban areas. It may be important to consider a “bus-stop” approach, where all vertiports or pads do not necessarily have to be electrified. For regional AAM flights, longer-range and lower-frequency flights might demand different battery solutions, such as larger capacity but slower charging systems. Additionally, alternative energy sources (e.g. solar power) could be necessary to support eVTOL operations in areas lacking grid infrastructure. –Operational costs: Operating in urban and rural areas will lead to variant cost structures. Urban areas with higher demand can better support premium pricing and dynamic models, but regional corridors will initially require subsidies to offset operational costs. These subsidies will ensure that rural services are economically viable while maintaining affordable consumer prices. –ATM and safety: ATM systems in urban areas will be more sophisticated, given the presence of high-traffic airports, densely populated areas and helicopter and other aviation activity. Congestion and safety management will need higher levels of scrutiny and, therefore, staffing. Relational communication and navigation are crucial for regional transit, especially in areas with less-developed infrastructure than urban areas. These ATM systems will need to be interoperable and agile to suit the unique needs of each environment. –Maintenance and support networks: Maintenance facilities and technical support will need to be built to ensure the reliability of AAM services. If these are strategically housed in regional hubs, operational costs for services, spare parts, repair technicians and backup power systems may be optimized. According to aerospace analysts, the price per kilowatt-hour (kWh) for batteries is two to three times the current cost of automotive batteries.15 The higher quality of batteries used in aerospace allows these batteries to have a significant application in their second life across a variety of applications. Some are mentioned below: Applications 1. Renewable energy systems 2. Energy storage for data centres and telecommunications towers 3. Electric vehicle (EV) charging infrastructure 4. Grid services (frequency regulation, peak shaving) 5. Backup power for critical infrastructure Using second-life batteries for non-aviation applications will reduce hazardous waste, conserve resources and reduce energy storage costs. These factors for product and infrastructure costs will determine the business case justification for the economic considerations for eVTOLs. A report by the Institute for Social and Economic Change (ISEC) estimated that traffic congestion in Bangalore, India, caused around INR 11.7 billion in lost productivity in 2018, with approximately 700,000 hours wasted due to traffic jams.16 AAM is expected to reduce traffic congestion on Indian roads and provide significant benefits, such as saving lives through air ambulances. This makes a strong case for its use and highlights its potential return on investment (ROI) in contributing to the nation’s growth and GDP . Pricing As the sector takes shape, original equipment manufacturers (OEMs) and service providers are expected to begin developing pricing strategies to cater to their target markets. While doing so, it is important to keep in mind the buyer persona to cater to a pan-Indian audience. Early indications are that consumers may be willing to pay up to twice as much for a new mode of transport compared to what they currently spend on their existing Using second- life batteries for non-aviation applications will reduce hazardous waste, conserve resources and reduce energy storage costs. Skyways to the Future: Operational Concepts for Advanced Air Mobility in India 26