Midyear Update: The Evolving Advanced Air Mobility Landscape

The first half of 2026 has marked a pivotal period for the advanced air mobility (AAM) sector as the industry continues its transition from aircraft development and regulatory planning toward operational implementation. While certification, infrastructure deployment, and commercialization timelines remain uneven across jurisdictions, significant progress has been made in establishing the regulatory frameworks, public-private partnerships, and investment structures necessary to support future operations.

In the United States, the Federal Aviation Administration’s (FAA’s) electric Vertical Takeoff and Landing (eVTOL) Integration Pilot Program (eIPP) is well underway, while international markets—including the Gulf region, China, and Europe—are advancing complementary strategies focused on infrastructure, airspace integration, and commercial deployment.

At the same time, there is growing attention surrounding the foundational elements required for long-term industry success, including energy infrastructure, vertiport development, and the emergence of aviation finance models tailored to this new asset class.

UNITED STATES EIPP PROJECTS UPDATE

Following the announcement of eight eIPP projects in March 2026, none have reached operational status, although progress is certainly being made. Per the FAA’s Screening Information Request published on December 23, 2025, once other transaction agreements (OTAs) are negotiated and signed, operations must begin within 90 days.

However, as of early June 2026, several project OTAs remain pending. Given the inherent overlap of the eIPP and data-sharing obligations, OTAs are necessary as they provide a more flexible framework to facilitate project data sharing between the FAA and eVTOL operators.

The transition from project selection to OTA execution is proving to be a key gating item before operational testing activity can commence. One project with an active OTA—the Port Authority of New York and New Jersey with partners Archer Aviation, BETA Technologies, Joby Aviation, and Electra—has emerged as the most operationally advanced, with Joby Aviation having conducted a highly publicized test flight from Kennedy International Airport to Manhattan in April 2026.

For more information on the selection of eIPP projects, please see our previous LawFlash, DOT and FAA Announce eIPP Participants.

ZOOMING OUT: THE GLOBAL RACE TO COMMERCIAL OPERATIONS

The global race to AAM operations is accelerating as governments seek to position themselves at the forefront of next-generation transportation. Nowhere is this more evident than in the Gulf Cooperation Council (GCC), where public-sector leadership is driving the development of regulatory frameworks, vertiport infrastructure, airspace integration strategies, and safety oversight regimes for eVTOL aircraft and other AAM services.

The United Arab Emirates has emerged as a leading early-adopter market through the introduction of dedicated vertiport regulations, the development of national air corridors for air taxis and cargo drones, and the rollout of commercial vertiport construction programs supported by public-private partnerships. Saudi Arabia is pursuing a similarly ambitious agenda under Vision 2030, implementing a national AAM roadmap, establishing regulatory pathways for eVTOL operations, and heavily investing in aviation infrastructure to support connectivity across major cities, tourism destinations, and gigaprojects.

Other GCC states, including Bahrain, Kuwait, and Qatar, are monitoring international developments and expanding unmanned aircraft frameworks that could provide a foundation for future AAM deployment.

Beyond the Gulf, China and the European Union are emerging as two of the most influential players shaping the future of AAM, albeit through different approaches. China has made AAM and the “low-altitude economy” a national strategic priority, pairing regulatory support with rapid infrastructure deployment and operational testing.

Cities such as Shenzhen are building extensive networks of takeoff and landing facilities, with plans for 100 low-altitude sites by 2026, including dedicated passenger-carrying vertiports, while companies such as EHang have already demonstrated automated vertiport operations and passenger-carrying eVTOL services.

The European Union has reached a high degree of regulatory maturity through the European Union Aviation Safety Agency’s comprehensive certification and operational framework, including its Special Condition VTOL regime and U-space airspace integration initiatives.

Together, these developments illustrate a global competition characterized by different strategic priorities: the United Arab Emirates and China are focused on accelerating deployment and securing first-mover advantages through infrastructure rollout and early commercial operations, while the European Union is prioritizing safety, certification, and harmonized cross-border implementation.

Despite this momentum, all jurisdictions continue to face common challenges, including vertiport and charging infrastructure requirements, airspace integration, public acceptance, cybersecurity, battery performance, and the long-term commercial viability of AAM services.

THE ‘E’ IN EVTOL: ENERGY AND INFRASTRUCTURE DEVELOPMENTS

With the progression of eIPP projects in the United States and regulatory buildouts in the Middle East, Europe, and Asia, operators are increasingly focused on the supporting networks of vertiports, charging stations, and energy storage systems that will power these next-generation aircraft. At the same time, safety considerations, including downwash and outwash effects, obstacle clearance, ground-risk management, and urban integration, are driving increased reliance on advanced modeling tools and AI-based land-use analysis to support site selection and regulatory approvals.

Recent market developments underscore the growing urgency of infrastructure deployment, with commercial vertiports reaching technical completion in Dubai and new vertiport networks being planned across Brazil, Japan, the Middle East, and the United States.

Utilities and energy readiness have emerged as equally significant challenges for the sector. Unlike traditional heliports, vertiports will require high-capacity charging infrastructure, energy storage systems, and substantial utility coordination to support rapid aircraft turnaround times. Industry estimates suggest that a single vertiport pad may require one to two megawatts of reliable power per landing pad, creating demands comparable to hundreds or even thousands of homes and necessitating significant grid upgrades in many locations.

As a result, developers are pursuing partnerships with utilities, grid operators, and energy providers to address interconnection, capacity expansion, resiliency planning, and long-term power supply arrangements. Clean energy procurement, battery storage, and microgrid solutions are also becoming central components of vertiport planning as operators seek to ensure reliability during outages and align with broader decarbonization objectives.

These trends reinforce a central theme for 2026: the success of commercial AAM deployment will depend not only on aircraft certification but also on the timely development of the energy and infrastructure ecosystem required to support scalable operations.

LOOKING AHEAD: FINANCING THE FUTURE OF AVIATION

As commercial operations become a more tangible reality amid market maturation, the AAM sector is seeing significant capital deployment across the value chain—from aircraft development to ground infrastructure buildouts, and in software and technology. Thus far, funding has heavily relied on corporate partnerships coupled with venture investors, including venture capital, private equity, and institutional investors.

This has generated immense cash flow. The AAM market is projected to grow from $14.14 billion in 2025 to $121.53 billion in 2035, with the AAM Reality Index noting that the top three players—Joby Aviation, BETA Technologies, and Archer Aviation—have secured a combined $11 billion in funding.

From an asset finance perspective, investors must balance large risks and rewards when deploying capital toward eVTOL aircraft and consider what best practices might be applied from commercial aircraft financing. The commercial aircraft market, despite its persistent supply chain challenges, is comparatively more predictable when considering established aircraft metrics such as useful life, maintenance cycles, residual value, tradability, and global operator demand. These factors have underpinned aircraft leasing and secured lending markets for decades.

As the industry reaches the midpoint of 2026, financiers are considering the pace at which eVTOL aircraft can evolve from a venture-backed technology proposition into a financeable transportation asset. For lenders and lessors, certification milestones alone will not be sufficient; evidence of asset value (both residual and new), maintenance standards, intervals and requirements, sustainable revenue generation, operational reliability, and a diversified operator base must also be presented.

The emergence of recurring commercial operations, particularly in airport shuttle, cargo logistics, medical transport, and defense-related applications, will be critical in establishing performance histories that can support traditional credit underwriting.

CONCLUSION

As the second half of 2026 unfolds, the AAM sector finds itself at an important inflection point. The focus is increasingly shifting from technological promise to operational execution, with stakeholders working to address the practical challenges of commercial deployment. While questions remain regarding certification timelines, infrastructure readiness, energy availability, and long-term asset values, momentum continues to build across key global markets.

The pace at which pilot programs, infrastructure investments, and regulatory initiatives can be converted into sustainable commercial operations will likely determine which jurisdictions and market participants emerge as leaders in the next phase of AAM.