Building Public–Private Partnerships for Advanced Air Mobility Infrastructure Using Game Theory

To operationalize advanced air mobility (AAM) and realize its potential market value, AAM infrastructure development is needed. However, the investment required for this often exceeds the individual capacity of state governments. The challenge for state governments lies in deciding whether they can independently invest in the entire infrastructure or whether they should form public–private partnerships (PPP) with private entities. To aid state governments and policymakers in making informed decisions on AAM infrastructure investment, we have devised two models: one without PPP, identifying the optimal timing for the state governments to independently invest in AAM infrastructure in specific cities over a given analysis horizon, and the other with PPP, focusing on resolving a PPP game for AAM infrastructure investment involving state governments and private investors. The PPP model addresses uncertainties and risks in AAM operations and allows renegotiation between investors in case of unexpected situations. The equilibrium solutions generated from the PPP model reveal optimal strategies for state governments and private investors. Results highlight the required investment amounts, the optimal investment times, and the investment returns for both players. Additionally, parametric analysis is conducted by varying critical parameters to observe how these variations affect outcomes for both investors.