Low-altitude Economy: Building the Flying Car, Air Tourism and Drone Logistics Industry

ADJOURNMENT MOTION

The Deputy Leader of the House (Mr Zaqy Mohamad): Mr Deputy Speaker, I seek to move, "That Parliament do now adjourn."

Question proposed.

Low-altitude Economy: Building the Flying Car, Air Tourism and Drone Logistics Industry

Mr Deputy Speaker: Dr Neo Kok Beng.

5.34 pm

Dr Neo Kok Beng (Nominated Member): Mr Deputy Speaker, Sir, yesterday I mentioned I was a telco engineer. Today, I am going to state I am an aerospace engineer. I actually work on the Super-Skyhawk A-4SU on Data Bus networking. But I am also a Fellow at the Royal Aeronautical Society. My topic today is on drone but actually, more than drones – the bigger drone or what we call the electric vertical-take-off and landing (eVTOL).

First, I would like to declare I am the founder of an eVTOL company that designs manned drones or eVTOL in Singapore and is flying. So, what is eVTOL? Common people will say that it is a flying car, air taxis. Those are interesting stuff that make kids every excited, including adults, I think so.

For this Motion, I will explore this emerging and high-growth market, dissect the opportunities and challenges that we face in Singapore and propose some strategies and also what initiatives that we can have into building an eVTOL industry going forward.

The first factor is the emerging high-growth market. Sometimes, we call it the low-altitude economy.

There are two terminologies that we need to be very clear here. It is the western perspective and the eastern perspective. The western perspective calls it "advanced air mobility". It is defined by National Aeronautics and Space Administration (NASA) five years back. The eastern perspective is we call it the "low-altitude economy", or in Chinese, "低空经济". I actually find that the low-altitude economy is more encompassing and that is why I use the terminology low-altitude economy.

The drones that we see in Singapore and regulated by the Civil Aviation Authority of Singapore (CAAS) for Unmanned Aircraft Pilot Licence or Drone Pilot Licence up to 25 kilogramme (kg) is Category A and above that is Category B. We do not have a lot of huge drones in Singapore. Mostly, our drone pilots are actually Category A. So, advanced air mobility does not have a lot of presence in Singapore.

Let us talk about how this low-altitude economy is important for Singapore.

Just imagine that whatever is on the road, whether it is buses, cars, vans, trucks or bicycles, we lift it up like maybe 50 metres, 100 metres into the sky. Then, we have a completely different set of economy – and that is low-altitude economy. So, the definition of low-altitude economy, up to what height, actually, nobody knows. It depends on individual country.

I used to have a private pilot licence. I can fly up to 10,000 feet in Singapore, but maybe we should not fly that high. But I think 1,000 feet or 300 metres is really good enough. It covers the top of all the buildings.

This can generate new innovations – and I will explain it later – have higher or greater productivity and completely destructive business model.

Let us take a look the market itself. The global drone market, of course, including military, is about US$30 billion today. And eVTOL, in the commercial side, is probably about $3.1 billion. There is precedent research in 2025. It is projected to reach $216 billion by 2035, with a compounded annual growth rate of 51.8%.

If you look at the figures from different research agencies, they are all completely different: some will say $200 billion, some will say $100 billion. But you get the numbers. It is big. So, should we tap on this opportunity to develop a new innovation system, create better jobs and that is highly tech intensive?

President Trump last year noted that the United States (US) has to catch up in the advanced air mobility and therefore, there was an executive order signed for the Department of Transportation and Federal Aviation Administration to foster innovations. So, 36 states have already started to implement, whether it is between the airport or within the states.

The other player is really aggressive – China. Two years ago, I went to the Suzhou Industrial Park with Senior Minister of State Koh Poh Koon. Someone handed me a name card, and the title is, Director of Low-Altitude Economy, Suzhou Industrial Park. It has gone down to such details. And now, what we have seen is that there are 30 provinces in China actively rolling out low-altitude economy solutions. I visited a couple of them in different provinces. I heard that in Guangzhou, there are already 15,000 low-altitude economy companies – dealing with parts, not really the full craft, but you can see the size.

So, we can see how big the market is. The question is: what are the opportunities and challenges that Singapore can work on?

Couple of years back, about maybe four years back, there is a report by a private company, no more in existence but when they planned to deploy here, said that in Singapore, there is an output of about $4 billion contribution to the economy with about 1,500 jobs. I do not know whether this number is valid, but I think it warrants some research to see how big this economy is.

What are the opportunities? For Singapore is highly urbanised. And do we really need air logistics? Yes, within Singapore, but it is going to be difficult and the safety factor is one of the most important part. But actually, we can look at the air mobility business, that is, bringing people from one place to another on a regional side – Singapore and Johor, Singapore and Batam, a regional pathway that we can hop from one place to another.

Singapore prides itself, as we do not have domestic destinations for aircraft, but we are international from day one. So, from the view of the low-altitude economy, we should be regional from day one. So, that is air mobility business, air tourism business.

We do not have a lot of land. But actually, we do have interesting stuff that we can explore within Singapore. Typical areas for air tourism is like a bird's eye view of the Marina Bay and Sentosa. I was thinking that even the ports will be interesting to tourists too, with all the container ships floating. I also think that Mandai Zoo will be a great destination for us to look from the top. But when I was flying, with my Private Pilot Licence, one time, I did fly a little bit lower to visit the zoo without paying tickets.

The other thing I think that is really important is air logistics, and cross-border logistics is really interesting. There are a lot of disruptive business models we can work on, and I will elaborate on this.

What really are the challenges? Well, highly urbanised space, very good integrated logistics. So, we do not really need to do most of this stuff or in Singapore. Our island is slightly more than 700 square kilometres. Our airspace is limited. And for us actually to develop or test such a craft, I give you a recent example.

In the Airshow, the Nanyang Technological University (NTU) unveiled the design of an eVTOL that has done its initial hover test in Singapore. But beyond that, the trials had to be conducted in Germany forthe flight. Therefore, we really need to overcome these constraints in order to build a low-altitude economy or industry.

How to do that? We first need to have a national initiative involving a triple helix of Government, industry and of course, the research institutes and universities. The current activities that we have right now in Singapore is, of course, ST Engineering. I used to be from ST Engineering.

ST Engineering has a 100-kg payload logistic drone due for certification in I think 2028. My company, NEO Aeronautics, we have a 100-kg payload for sports and recreation, it is designed for the US Federal Aviation Administration market, Part 103. Actually, it is ready now. Does not fly in Singapore.

NTU's 200 kg eVTOL prototype unveiled in 2026, led by Prof James Wang; and in the Singapore Institute of Technology (SIT), 80 kg moving to a 200-kg payload, led by Prof Victor Wang.

We should have a strategy, Mr Deputy Speaker, a national strategy for low-altitude economy. I think the triple helix forming a consortium of the Government agencies such as CAAS, Economic Development Board, Enterprise Singapore, even the Maritime Port Authority of Singapore (MPA) and Singapore Tourism Board, can come in and make it much more comprehensive.

I would like to talk a little bit about how can we then grow this industry. I think the first thing of growing any industry is really to have talents. We never had design engineers or design aerospace engineers in Singapore, but we have lots of maintenance, repair and overhaul (MRO) engineers for maintaining aircraft. And we are glad that we achieved 10% of the total MRO market in the world – which means we can do it if we put our mind to it.

So, for this intellectual capital, we need to have more manpower and talent, and that goes to the universities or the polytechnics. Currently, there is no specialisation in such low-altitude mobility or advanced air mobility technology in Singapore. SIT does have a degree programme, but it is much more focused on aerospace. So, I think that we should look in detail for a diploma and degree with specialisation, I would not say a pure degree, but a specialisation, and have quite a bit of conversion programmes for existing engineers to convert or technologies to convert to drone technology or eVTOL technology.

The infrastructure capital is really, really the important part here. When I talk about infrastructure capital, I am also looking at the regulations. CAAS has spearheaded the development of the advanced air mobility technology regulatory standards in Asia Pacific. That is a very good move. That is trying to harmonise our standards with the rest of the Asia Pacific countries. MPA has launched Singapore's first Maritime Drone Estate in April 2021. I understand that they are also upgrading it, but it is actually for a small payload. If we want to go for a bigger payload, I think we really need to have bigger test facility.

Therefore, we have progressed, but we really need a turbo boost, with much more resources and aggressive plans. Therefore, a dedicated sandbox. Testing drones or eVTOL in Singapore is really difficult. You can ask for a field, which is like a football field, and then, you try to fly around, and then, the rains come and it is hot and there is no dedicated place for you to have your workshop. So, I suggest that we should identify a location, whether in a university or a research institute, to have at least half a football field with at least 20 metres for flight test and everyone can go there – because I do not think we can afford a lot of such flight test centres.

But we need to think out of the box because that itself allow us to just hover. So, a dedicated sandbox or flight test facility just allows us to hover. What is really important is the test flight, and that needs space. So, I think we should think without the box. What is without the box? It means if the box is Singapore, we should get out of Singapore, and therefore have a regional sandbox. And if you have a regional sandbox, that means our authorities have to work with the authorities in neighbouring countries for joint certification, joint flight test, joint recognition. I think that will allow us to harmonise our standards and allow us to work with different authorities and facilitate cross border drone flying or eVTOL flights.

The last part is on the innovation capital. China is really good in the hardware. And where are we? In manufacturing, we will not be able to compete based on the manufacturing capacity. But we should focus really on what we do best – highly value-added jobs. I think that is in applications and also business models.

For example, we can have purposefully built drones for oil spill disbursement. We can do it for our ports and it can be extended to many, many ports in the world. So, that is one application with the right business model.

Another example, our neighbours have land, many plantations. And if you plant container ports or storage facilities or logistics centres in such locations, which is really cheap, and you can airlift it out, so you can actually store seasonal goods, you can store expensive value-added materials where the storage space is really, really cheap. Therefore, you can airlift it out as necessary. You do not need to build infrastructure. You do not need to build roads. Give us a completely different way of operating a business.

So, moving facilities or bus or trucks or bicycles into the air is not just simply moving into the air. It is also coming with a different business model.

Therefore, I would recommend that the National Research Foundation consider this to be a white space and really aggressively allocate some good money for the industry, and the universities and research institutions.

Mr Deputy Speaker, Singapore does not design and build aircraft, but we have attained 10% of the world's MRO market. This is the chance for us to have aircraft design engineers, providing good jobs and also generating good economic output for our people.

Mr Deputy Speaker: Senior Minister of State Sun Xueling.

5.53 pm

The Senior Minister of State for Transport (Ms Sun Xueling): Mr Deputy Speaker, I thank Dr Neo for raising his Motion. The Government pays close attention to the development of the low-altitude economy. Indeed, drones and eVTOLs can be viable options for economic, transport and logistics uses. We agree with Dr Neo that these technologies provide opportunities to enhance safety and productivity, enable new operational capabilities and services, and support innovation, across multiple domains.

In particular, Dr Neo spoke at length about eVTOLs, which his company, NEO Aeronautics, focuses on, and mentioned air mobility, air tourism and air logistics as areas of opportunity for Singapore.

Unfortunately, it may not be viable to deploy eVTOLs extensively as a domestic transport option. EVTOLS are similar to helicopters, and are more viable in places with severe traffic congestion, and where point-to-point flight can cut down travel time considerably. They will have marginal utility in Singapore, where airspace is congested and given that we already benefit from a well-connected ground transport network.

However, eVTOLs could eventually become a viable option for cross-border travel to adjacent offshore islands, or even cross-border cargo transfer with neighbouring countries. We will continue to monitor the progress of eVTOL technologies and its safety and cost considerations.

In contrast, drone technology is at a more mature stage, with more viable and developed use cases. In Singapore, public sector agencies and commercial players are already using drones in practical, beneficial and meaningful ways across numerous domains.

For logistics, we are already trialling the use of drones for ship‑to‑shore deliveries at our port, to transfer and turnaround high-value or essential items. By reducing the need for frequent boat trips, drones alleviate manpower demands and minimise risks faced by maritime workers when operating in challenging sea conditions.

For land transport, drones already help to inspect Singapore’s train and road tunnels. They allow our engineers to carry out their inspections more efficiently and with greater precision, while reducing the need for manpower to operate in potentially hazardous or hard-to-access environments.

For aviation, commercial firms are exploring the use of drones for visual inspections of aircraft, to complement existing maintenance processes. This allows for faster checks, enhance accuracy and improve safety outcomes, freeing up our maintenance personnel to focus their expertise where it is most needed.

For the built environment, the Building and Construction Authority, and the Housing and Development Board already use drones to conduct periodic façade inspections in a faster and more efficient manner. In October last year, the Ministry of National Development also trialled the use of drones to conduct high-rise ledge cleaning in Punggol, which would otherwise need to be conducted by workers on gondolas, which incurs higher safety risks. We hope to scale up such operations so that more buildings in Singapore can be assessed and maintained using drones.

For security, the Singapore Police Force deploys drones to monitor crowd numbers in real-time during major events like the National Day Parade or the Marina Bay Countdown.

As you can see, there are many use cases that our various public sector agencies are already using drones for.

The Government has sought to create a conducive ecosystem in Singapore for the safe experimentation, development and deployment of drones.

First, we support research and innovation through trials, sandboxes and funding. We agree with Dr Neo that these are important for rigorous testing within safe and controlled environments. This helps us determine the viability of new use cases and figure out how drone technologies and operational processes can be further refined to meet desired outcomes.

For example, PUB worked with ST Engineering to use drones to monitor water quality and activities at six reservoirs, which is a faster and more accurate alternative to the traditional method of in-person patrols. Using drones in this manner can potentially reduce the required man-hours by up to 70%.

We also identify areas that we can temporarily use as sandboxes for flight trials. In the case of the NTU research team which Dr Neo mentioned, CAAS facilitated the initial hover tests of their prototype eVTOL at the former Turf City racecourse in Kranji last year, ahead of its public unveiling at this year’s Singapore Airshow.

We will review how we can expand testing sites, including exploring overseas sandboxes in partnership with regional neighbours, as Dr Neo has suggested. These can be located further from urban areas and provide a safer and larger environment to trial larger drones and eVTOLs.

Second, we adapt and streamline our rules regularly to allow a wider scope of low-altitude operations.

In 2025, we allowed some commercial drone operations to be conducted at higher altitudes in designated areas for all days of the week for façade inspections. This increased the flexibility and productivity of these inspections, and reduced operating costs.

We have also facilitated trials for beyond-visual-line-of-sight flights. These flights can safely operate over larger areas and longer distances away from the drone operator, potentially with reduced manpower.

The Ministry of Home Affairs is exploring using beyond-visual-line-of-sight drones to deliver automated external defibrillators during emergencies.

We have also revised our regulations to allow commercial operators to seek approval on a per-activity rather than per-drone basis. In particular, this has benefited drone light show operators, who handle thousands of drones at a go to create visually stunning spectacles.

In 2025, we also enhanced real-time airspace clearance processes to expedite approval of drone activities, such that operators can now obtain immediate clearance for drone operations at certain heights and locations.

Third, we are investing in talent and manpower, as Dr Neo had suggested. We are intensifying education efforts to promote the responsible use of drones, develop suitable technical skills and nurture interest in low-altitude technologies for Singaporeans of all backgrounds and ages.

We are working closely with our educational institutions to integrate drone-related courses into formal curricula. Dr Neo suggested creating specialisations in advanced air mobility technologies, especially at the tertiary level.

Those taking aerospace engineering courses at university can today access an increasing variety of drone-related modules. Four out of our five polytechnics are also approved as Unmanned Aircraft Training Organisations, and conduct practical courses in drone operations. Several primary and secondary schools have also introduced drone flying with their curricula or as part of the Applied Learning Programme.

Beyond our educational institutions, there is a wide range of facilities, workshops and courses available to the wider public. CAAS has launched two Unmanned Aircraft Flying Areas at Pandan Reservoir and Dover Road where enthusiasts can gather and conduct their own recreational operations. At the same time, CAAS partners with vendors, such as Just Fly It, to conduct hands-on workshops. Members of the public may also use their SkillsFuture credits to attend short-term drone operation courses by institutions, such as the Singapore Management University and Institute of Technical Education, to ensure that their skills are kept up to date.

While we have made considerable progress thus far, we know that more can definitely be done. And this will require overcoming certain constraints, which Dr Neo has alluded to.

First, Singapore’s airspace is limited. With multiple airports and air bases, and flights coming and going constantly, the use of our low-altitude airspace will need to be managed carefully between civil and military aircraft, and drones and eVTOLs.

Second, Singapore has a dense and highly built-up urban environment. And this gives rise to complex issues relating to security, safety and privacy, due to the dense high-rise residential areas and closely co-located security-sensitive locations across our island.

Third, Singapore’s unpredictable weather and tropical climate pose practical challenges for aviation. This is something that we already need to manage carefully for large planes at Changi, let alone smaller and more unstable low-altitude aircraft. It is essential for overall aviation safety that we test new technologies rigorously and work out robust operational processes prior to development.

Against this backdrop, we have generally adopted a conservative approach in the past. But with drone technology becoming more mature, we can do more. We are studying the approaches in overseas jurisdictions and will adapt what is relevant to Singapore’s operating environment.

Dr Neo mentioned China as an example, and we agree that there are aspects that Singapore can learn from. Chinese cities are trialling drones for a multitude of urban use cases, including food and parcel deliveries, high-rise façade inspections, traffic monitoring and enforcement, and search and rescue operations, many of which Singapore may also wish to explore.

The Chinese government has also provided strong support for companies involved in drone development and production in the form of tax reliefs, subsidies and industrial parks.

In the US too, there has been significant progress. Commercial companies like Wing, a Google spin-off that our Acting Minister of Transport visited just last month, have commenced delivery operations across the country.

In these cities, regulatory frameworks are evolving rapidly. For instance, some cities in China have recently tightened their regulations for recreational and civilian drone operations. And in the US, the regulatory frameworks vary considerably depending on the state and the city.

In Singapore, the Government, as I have mentioned, will continue to closely monitor the evolution of this space. Dr Neo proposed a national strategy on advanced air mobility and the low-altitude economy. He mentioned a “triple-helix approach” involving the Government, industry and research or educational institutions. We agree with Dr Neo —

Mr Deputy Speaker: Senior Minister of State Sun, could I kindly request you to wrap up? Because we do have a 30-minute timeframe for this Adjournment Motion.

Ms Sun Xueling: Yes, thank you. We agree with Dr Neo that it is important to bring together the wider ecosystem and we will consult all stakeholders.

The Ministry of Transport's immediate focus is to drive the usage of drones more extensively, especially by the public sector and this is because we already have many potential use cases. And we will also continue to work with the private sector on commercial use cases while continuing to emphasise safety and being cognisant of our unique operating environment.

Allow me to end off by assuring the House that we will continue to work together closely to safely and responsibly harness the benefits of low-altitude technologies for our transport sector and Singapore’s wider economy. Thank you, Mr Deputy Speaker.

6.05 pm

Mr Deputy Speaker: Order. The time allowed for the proceedings has expired. I adjourn the House pursuant to the Standing Order. Order, Order.

The Question having been proposed at 5.35 pm and the debate having continued for half an hour, Mr Deputy Speaker adjourned the House without question put, pursuant to the Standing Order.

Adjourned accordingly at 6.05 pm.