On The Horizon: How One Company Plans To Use Its Innovative Aircraft Design To Revolutionize Regional Air Travel

June 06, 2024 at 08:45 AM EDT

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By James Blacker, Benzinga

Investment in Regional Air Mobility (RAM) is on the rise, driven by innovative flight technologies that promise to transform short-haul travel and improve connectivity between small cities and rural areas. As the demand for efficient, sustainable and flexible transportation increases, companies like New Horizon Aircraft (NASDAQ: HOVR) are positioning themselves to capitalize on a global market that could grow to $115 billion by 2035, with some 300 to 700 million passengers annually.

Rising Demand For RAM

In the United States, regional airports are underutilized, partly because most airlines use hub-and-spoke networks that require passengers to transit at larger hubs. Most Americans therefore choose to either drive to their final destination or fly from a larger airport, even if it is further away. The idea of RAM is to use smaller aircraft to connect regions that are underserved by traditional airline routes. It brings the convenience and speed of air travel to everyone, wherever they are located across the country.

A NASA-funded study carried out by the Georgia Institute of Technology’s School of Aerospace Engineering predicts a resurgence in demand for regional flying. Based on door-to-door travel costs and travel-time savings, the researchers identified how many people taking journeys of more than 100 miles would choose to fly if they could do so from a nearby regional airport.

Technological Advances In Aviation

McKinsey & Company notes that innovations in propulsion, aircraft design, manufacturing, navigation and control are making small aircraft more viable. These technological advances promise to push down operational costs and reduce the environmental impact. In the future, we could even see fully autonomous aircraft, which would cut costs even further as labor accounts for around 20%-30% of small aircraft operating costs.

According to McKinsey, more than 50 companies are developing battery-electric, hybrid, or hydrogen small aircraft. Players working on new aircraft designs include Airbus and Embraer (NYSE: ERJ).

eVTOL For Regional Mobility?

Another player looking to tap into the RAM market is New Horizon Aircraft (NASDAQ: HOVR), a developer of electric Vertical Take-Off and Landing (eVTOL) aircraft.

While eVTOL aircraft are typically designed for very short flights within urban areas, Horizon’s Cavorite X7 uses a patented wing design that allows it to fly further and carry heavier loads, making it suitable for the regional air mobility market.

New Horizon’s Cavorite X7 is a next generation hybrid-electric eVTOL aircraft that can move people and cargo across distances of between 50 and 500 miles at speeds of up to 250 mph. It is a seven-seater aircraft that can take off and land vertically, like a helicopter. However, once it reaches a safe altitude, the Cavorite X7 reconfigures and flies like a normal plane, allowing it to fly faster and further than a helicopter. With a hybrid electric power system, the Cavorite X7 can also recharge mid-flight.

In addition to passenger travel for the RAM market, New Horizon envisages that the X7 will also be used in various sectors, including medical evacuation, natural disaster response, emergency surveillance and search and rescue.

A Promising Horizon

Recent investment in the RAM market represents the start of a seismic shift to more efficient and sustainable short-haul travel. New Horizon Aircraft is at the forefront of this transformation, offering an innovative product that addresses the growing demand for regional connectivity.

For investors, this could present a compelling opportunity to be part of a market poised for substantial growth.

Featured photo courtesy of New Horizon

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