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Last weekend, the Living Legends of Aviation Awards was held in WolfgangSee, Austria as part of the contingent from fuel-cell electric vehicle pioneer H2X Global. The reason for H2X’s involvement was to speak at the “innovation talks” prior to the ceremony, which brought together leaders in aviation and automotive to discuss market trends and how to work together to decarbonise mobility. ABSI this week will look at key takeaways from the discussion and what that may mean for your transportation future.

Hydrogen VS. Battery

To start, it was clear the only fuel sources being seriously considered are batteries and hydrogen. The business presentations from the start-ups made it clear that there is division on what the dominant technology of the future will be. There are several companies who think that battery technology will have a place in the aviation future, especially in a potential emerging micro-flight sector, while others are sold on hydrogen’s energy density. In contrast, there was no argument from Airbus which is all-in on hydrogen jet engines fueling future commercial flights from as early as 2035.

The Innovator's Dilemma 

Speaking of Airbus, their drive into hydrogen aviation appears to be bucking the innovator’s dilemma. Coined by Harvard professor Clayton Christensen, the innovator’s dilemma describes how successful firms fear cannibalising their existing profit centres and therefore fail to truly innovate. They have set a very ambitious goal of maiden hydrogen commercial flights from 2035 while key competitor, US company Boeing, is targeting sustainable fuels as the road to decarbonisation. If Boeing is wrong, it could put them up to a decade behind their old European rivals.

This innovator’s dilemma is also a big issue in the automobile industry. The auto industry failed to innovate on battery electric vehicles, which has allowed Tesla to rise and dominate the market. The rest of the competition is only now just starting to catch up but the first-mover advantage will see Tesla remain the BEV car of choice for the foreseeable future.

Continually, the same can somewhat be said for hydrogen electric vehicles (FCEV). While the legacy automakers have learnt from their BEV mistakes and are apportioning funding to the development of FCEV, the likes of BMW and Audi don’t anticipate putting cars into production until at least 2030. This delay provides an opportunity for the likes of H2X Global, who are producing vehicles in 2022.

Future Flying Taxis

Keeping on the innovation topic, I met several entrepreneurs attempting to commercialise next-generation vertical take-off and landing (VTOL) aircraft. While the design/configuration varies, the aircraft will be electric and autonomous with a vision that this will be the technology set to revolutionise flying taxis. The panel discussion with representatives from Audi and BMW touched on the competition that air taxis could have on the auto industry, but they seemed unfazed by a potential new entrant with scepticism of if the market will even take off (no pun intended) given the safety and infrastructure required. One of the leaders in next-gen VTOL is Lilium Air Mobility, and speaking to founder/CEO, Daniel Weigand, he spoke of the market risks being the reason to start more niche by targeting private buyers initially while maintaining flexibility to adapt to the changing market.

The Regulatory Hurdle

Speaking of the market, the biggest barrier to innovation is usually regulation. This is magnified in the aviation industry, and rightfully so, given the impact faulty aircraft can have by falling out of the sky. In the innovation panel discussion, all contributors were in agreement that working with regulators is a vital step and going through the process of new aircraft certification will be one of the hardest barriers to overcome. The automobile industry was also in agreement on the role of regulation in the process but confessed that it is a much simpler and well-defined process; this is evidenced by the fact that BEV and FCEVs are already on the roads around the world. The automakers cited infrastructure as the critical hurdle for mass adoption of future electric vehicles, regardless of fuel source.

At the end of the innovation talks, I think the critical takeaway was that the mobility industry is extremely serious about decarbonising their industry. This is not an overnight process but the wheels are in motion for meaningful change to occur over the proceeding decades.

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