The domestic industrial landscape around urban air mobility (UAM) is changing. Unlike when the three telecom companies rushed in and waged a "race to secure the skies," SK Telecom and LG Uplus have now stepped back, leaving only KT in the phase 2 K-UAM demonstration. The goal of K-UAM is also shifting from "who flies first" to "who can hold out to the end and build a money-making model."
According to the industry on the 6th, SK Telecom disposed of 66.6% of its equity in U.S. UAM airframe company Joby Aviation in the fourth quarter of last year. Its remaining stake fell from 2.1% to 0.7%. SK Telecom focused on securing an early lead in K-UAM by partnering with Joby, an airframe manufacturer, but as commercialization has been delayed, the company appears to be shifting its strategic focus back to its core telecom business and AI. The company said the decision was due to "a change in the companywide management strategy to concentrate capabilities on telecom and AI businesses."
Earlier, LG Uplus also exited the phase 2 K-UAM demonstration. It disbanded its dedicated unit, effectively making an official withdrawal from the business. The industry believes LG Uplus is likewise prioritizing an early cleanup of low-profit businesses and strengthening competitiveness in new AI businesses and its core telecom operations. While UAM still carries the symbolism of a future growth industry, analysts say it inevitably falls down the priority list because of heavy upfront investment and uncertainty over when it will turn a profit.
The delay in UAM commercialization is not simply a matter of airframe development speed. Behind the government's decision to push back the K-UAM commercialization target from 2025 to 2028 lies a global delay in eVTOL (electric vertical takeoff and landing) development and certification, and the market has in fact moved on from "who flies first" to "who can first establish a system for safe operations." As a result, Korea's phase 2 K-UAM demonstration is proceeding in a direction that uses surrogate aircraft such as helicopters instead of actual eVTOLs to validate operating procedures, vertiports (dedicated bases where UAM airframes take off and land vertically), and urban operations systems first.
That does not mean the K-UAM play itself has fizzled out. Rather, the initiative appears to be shifting from telecom companies to aviation, airport, and infrastructure corporations. The Ministry of Land, Infrastructure and Transport adjusted the target timing for UAM commercialization from 2025 to 2028 last August, and since Oct. 2025 it has been conducting phase 2 urban demonstrations around the Incheon Ara Waterway. In this demonstration, the "One Team" of Korean Air Lines, Incheon International Airport Corporation (IIAC), Hyundai Motor, KT, and Hyundai Engineering & Construction, and the "Dream Team" of Korea Airports Corporation (KAC) and Hanwha Systems are participating. An industry official said, "It is more accurate to say that K-UAM is now in a stage of refining operating systems, infrastructure, and service operation models ahead of airframe competition."
The policy and regulatory blueprint is already in place. The Act on the Promotion and Support for the Utilization of Urban Air Mobility has been in effect since Apr. 2024. The law includes provisions on establishing a master plan, designating demonstration project zones and pilot operation areas, designating UAM corridors, supporting operators, and granting regulatory exemptions during demonstration and pilot phases. The problem is that a law does not immediately open a market. For actual commercialization, detailed rules such as airframe certification, pilot and operator qualifications, vertiport installation standards, low-altitude traffic management, insurance and liability, and noise and community acceptance must interlock tightly.
The situation is similar overseas. The U.S. Federal Aviation Administration (FAA) in 2024 issued final rules on the operation of powered-lift aircraft and pilot qualifications, and the European Union Aviation Safety Agency (EASA) continued work in 2025 to supplement VTOL (vertical takeoff and landing) certification specifications. Joby also entered its first flight test with an FAA-conforming airframe in March. This is why some say UAM is less an industry that is "taking off" in earnest and more one where only operators that can endure regulation, certification, and capital at the same time will remain.
This trend is not limited to telecom companies. Supernal, Hyundai Motor Group's U.S. advanced air mobility (AAM) unit, laid off 296 employees in February, with the remaining workforce said to be around 70 to 80 people. In August last year, Chief Executive Officer Shin Jae-won stepped down, and around the same time Chief Technology Officer David McBride also left the company. The industry interprets this as Hyundai Motor Group recalculating the commercialization timeline and the intensity of its investment.
Kim Kyung-won, a distinguished professor of business administration at Sejong University, said, "As UAM has turned into a long game, the finished-car camp also appears to be placing more weight on capital efficiency than on technological preemption," adding, "The phase of leading with rosy blueprints is over, and the reality-check phase has begun, where the question is who can shoulder regulation, certification, infrastructure build-out, and service operation to prove a revenue model."