By Cdr Sonal Saxena (Retd)
The Urban Air Mobility Market size is expected to grow from USD 2.91 billion in 2023 to USD 36.75 billion by 2035, at a CAGR of 23.54%. The Asia-Pacific region is fast emerging as a key source of momentum for the UAM sector. Various countries like China, Japan, and South Korea have been robustly investing in the development of UAM ecosystems in the region.
Recently, Eve (a subsidiary of EmbraerX), which is at the forefront of the urban air mobility revolution and plans for eVTOL deliveries and entry into service by 2026, has collaborated with DHL aiming to encompass several key aspects of the eVTOL supply chain.
This eVTOL supply chain framework would factor in modes of transportation, frequency and delivery plans, logistics partners, potential locations for advanced inventories, physical and technological infrastructure needs, and disruption contingency plans. The framework also would strategize the distribution of parts and materials essential for repairs and maintenance, optimizing supply chains for general supplies to vertiports and also address the critical battery logistics.
Essential Supply Chain aspects mandating consideration vis-à-vis the scope of such a study need detailed deliberations for a comprehensive framework formulation.
UAMs – The Future
To start, let’s familiarize with some basic terms and definitions about UAMS for a comprehensive understanding of the ecosystem and its dynamics:-
– The urban air mobility (UAM) market is an aviation industry term for on-demand and automated passenger or cargo-carrying air transportation services around cities and urban areas.
– The UAM market is subdivided by vehicle type, application, and geography. Piloted and autonomous in vehicle type and passenger transport and freighter by application.
– We will limit this discussion to electric vertical takeoff and landing (eVTOL) systems wherein both intercity and intra-city operations’ aspects can be encompassed.
– An autonomous eVTOL is an electric aircraft that can take off and land vertically and does not require a pilot on board to operate. The electric motor-powered aircraft are being designed to aim transportation of passengers and cargo in urban areas.
This autonomous sector is forecasted to show exponential growth. Some prominent players in eVTOLs UAM market include Embraer SA (through Eve UAM LLC), Volocopter GmbH, Guangzhou EHang Intelligent Technology Co. Ltd, Joby Aero, Inc., and Jaunt Air Mobility Corporation.
Wisk Aero and EHang are the key players currently developing autonomous eVTOLs. In October 2022, Wisk Aero (a joint venture between Boeing and Kitty Hawk), revealed its sixth-generation four-seater autonomous eVTOL aircraft.
In May 2022, during the India@2047, the Indian Civil Aviation Ministry announced that the country would have urban air mobility in the form of eVTOL across the country, after the trials in the United States and Canada are over. Such developments would accelerate the growth of UAM market in the region. The planning agencies of multi-modal networks have started consideration of the segment in their design stages.
Autonomous eVTOLs – A Support Ecosystem
These autonomous eVTOLs use a range of advanced technologies, including electric motors, batteries, and fly-by-wire command-and-control systems. They also use advanced sensors and control systems for high-accuracy navigation, positioning and obstacle avoidance through the dense urban environment. These also necessitate the requirement for landing pads, charging ports and ground handling systems. The regulatory compliance and safety systems form the most essential part of the eVTOL UAMS.
Spare Parts Logistics
The spare parts logistics market is influenced by a range of global dynamics, including economic, technological, and regulatory factors. Some key dynamics include:-
- Increasing demand for timely and efficient delivery – Industries such as automotive and aerospace rely on the timely delivery of parts to minimize downtime and ensure smooth operations.
- Fluctuating demand
- Regulatory constraints – The spare parts logistics market is subject to various regulations related to transportation, safety, and security. These regulations can create challenges for logistics companies, particularly those operating across multiple jurisdictions.
- Increasing competition – The spare parts logistics market is highly competitive, with a range of players offering specialized services such as emergency response, reverse logistics, and real-time tracking.
Some of the already existing market leader collaborations/ partnerships in the sector include:-
- DHL Supply Chain collaboration with Microsoft to develop intelligent supply chain solutions, including for spare parts logistics.
- UPS expanding its warehousing and distribution network for spare parts in Europe
- Amazon expansion of its B2B marketplace for industrial parts
- FedEx has acquired Manton Air-Sea Ltd, an Australian logistics company specializing in the transportation of automotive spare parts.
- CEVA Logistics partnership with Mitsubishi Electric for spare parts distribution in Europe.
- DB Schenker’s “Direct Distribution Product”, a specialized service for high-value spare parts, offering guaranteed delivery within 24 hours across Europe.
Factors in the Supply Chain Strategy of eVTOLs
The Supply Chain strategy for eVTOLs becomes much more complex with the introduction of additional following factors, wherein the collaboration between the subject study by Eve and DHL can play a pivotal role:-
- Modes of transportation and Logistics partners – DHL is an established one-stop shop for complete logistics solutions. So a comprehensive plan from them in this partnership study should deliver a gap-free solution
- Frequency and delivery plans – These will largely depend on the geography/ operating environment and utilization patterns and would have to factor supply chain fluctuations. Since the complete technology is new, limited data analytics would be available for effective predictive and prescriptive supply chain management and would form a real challenge. Considering the inventory carrying costs at every stage, a delicate balance between lean stocking would be essential as well as mandatorily avoiding stock-outs
- Potential locations for advanced inventories – This would be another challenge, especially in APAC regions, where geographical challenges and local factors bring huge volatility in connectivity and inventory planning. Also as mentioned earlier, developing a methodology for a smooth supply chain to overcome this challenge with limited data available for predictive demand analytics, would be very interesting.
- Physical and technological infrastructure needs – The servicing and MRO facilities and depth of repairs in each of these facilities would also need thorough groundwork. Testing and certification also would have to be factored and clearing inspection agencies would form an essential part of the regulatory/ compliance framework. These are beyond and in addition to basic Vertiport facilities, ground support etc, and air traffic management and services.
- Disruption contingency plans – Avoidance of stock out even in disruptive circumstances to enable sustainable ‘Time to Recovery’/ ‘Time to Survival’ of services and spares / MRO supply chain would have to be undertaken using effective risk assessment and avoidance/ mitigation
Therefore, we need to focus on this ecosystem to identify and mitigate respective logistical challenges in the overall supply chain strategy. We need to formulate a framework to explore and understand best practices for efficiently supplying operators and service centers with authentic spare parts and inputs.
Battery Logistics
Another important aspect includes batteries and their transportation, storage, and disposal requirements. Presently Lithium-ion batteries are governed under the United Nations regulations UN3480 and UN3481 as Class 9 “miscellaneous dangerous goods” due to the dangers of short-circuiting and thermal runaway risks. They are considered “Fully Regulated” for carriage in aircraft. Therefore, all lithium batteries may still be compliantly transported on cargo-only aircraft, subject to packaging, labeling and charge limitation regulations.
Reverse logistics of batteries would be a major issue as used batteries return is not permitted through air transportation. eVTOLs would be primarily dependent on battery logistics and the complete supply chain loop management strategy would require multi-level and multi-modal planning.
Conclusion – Supply Chain Strategy in eVTOLs with Technology, Blockchain and AI
– Advancements in technology must be leveraged by companies to improve inventory management and order processing, and to enhance the speed and accuracy of deliveries. e-Commerce growth be capitalized to meet the needs of e-commerce customers.
– Collaborative digital models with technologies such as embedded sensors, GPS, and RFID be used effectively to make the supply chain structures agile, flexible and open.
– Considering the criticality for ‘Safety Compliance’, a mechanism for “complete traceability and accountability” for the smallest of the component at all key points is most essential. As I have advocated earlier, incorporating blockchain technology in supply chain management will provide the most effective tool for optimal control, traceability and accountability through an economically viable solution.
– With data generation, AI/ ML models will definitely improve the prescriptive strategy making a much more resilient supply chain. Till such time and subsequently in conjunction, predictive models and digital twins should be factored from developmental stage for performance monitoring and generating demand analytics/ forecasting
References
# https://www.mrobusinesstoday.com/eve-joins-dhl-to-streamline-evtol-supply-chain/
* Urban Air Mobility Market Size & Share Analysis – Growth Trends & Forecasts (2023 – 2028) : https://www.mordorintelligence.com/industry-reports/urban-air-mobility-uam-market
@ https://aws.amazon.com/blogs/supply-chain/
