Urban Air Mobility Faces Untimely Cash Crunch, Say McKinsey Analysts

McKinsey Says Urban Air Mobility Faces Untimely Cash Crunch

New McKinsey report explains how companies could "bridge the funding gap"

A chart showing total disclosed funding for future air mobility by year — This graphic from McKinsey illustrates how total disclosed funding for the advanced air mobility industry has been steadily declining since 2021. © McKinsey & Company

By Hanneke Weitering • Science & Technology Editor

October 9, 2024

The nascent advanced air mobility (AAM) industry is facing an increasingly challenging funding environment with an ongoing decline in venture capital for new electric aircraft and propulsion technologies, according to a report published October 1 by global management consulting firm McKinsey & Company. In the blog post, McKinsey consultants spelt out the implications of the current funding environment and offer some strategic advice for AAM companies looking to “close the funding gap” as they near commercialization.

As McKinsey’s analysts note, the decline in funding for urban air mobility (UAM) and eVTOL aircraft “comes at a particularly bad time for companies in this segment,” as a handful of manufacturers are “getting close to commercialization.” For example, Joby and Archer are planning for service entry of their respective four-passenger eVTOL aircraft as early as 2025. Several other eVTOL developers are targeting service entry in 2026, including Lilium and Eve.

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