Low-altitude economy continues to heat up: with the implementation of policies, there are more orders and companies have started to compete for talents.

“The warm spring river, the duck knows it first. The original equipment manufacturers are like ducks swimming in the river. After the National Two Sessions in March 2024, the heat of the entire track will rise.” Chen Yan, Chief Strategy Officer of Zero Gravity Aircraft Industry, told the reporter of The Paper.

In December 2023, the Central Economic Work Conference designated the low-altitude economy as a strategic emerging industry. At the National People’s Congress in 2024, the low-altitude economy was included in the government work report as a ‘new growth engine’. This year is also known as the ‘first year of China’s low-altitude economy’.

Chen Yan said that after the Third Plenary Session of the 20th CPC Central Committee, the enthusiasm of all parties has further increased. Throughout the second half of the year, the key cities in the Yangtze River Delta and the Pearl River Delta have significantly increased their support for the low-altitude economy, and many practical support measures have been introduced and implemented. "Some places have set up special funds, and more and more investment institutions are approaching us. The national and local governments at all levels have sent a clear signal and sounded the clarion call for the all-round development of the low-altitude economy. ”

The current low-altitude economy is not only hot in terms of concepts, but also in terms of orders. China’s low-altitude economy is entering a rapid growth stage, with the emergence of many electric vertical take-off and landing (eVTOL) technologies and manufacturers. Recently, a reporter from The Paper revisited key technology-based enterprises surveyed in 2024 to observe their new progress in technology and business, as well as the new driving force they bring to the local economy as a ‘new engine’.

Business progress

As one of the key words of emerging industries in 2024, low-altitude economy has made exciting progress in business.

Chen Yan stated that there are currently two models of zero gravity that have been signed for orders. “The electric fixed-wing aircraft RX1E-A can now generate revenue, with 100% localization of core components, and has the qualification of a trainer aircraft, used for flight training and flight experience. This model has already obtained nearly a hundred confirmed orders by 2024.”

Chen Yan introduced that another model ZG-ONE is beginning the process of evidence collection, and there are currently more than a thousand intended orders. “Intended orders mainly come from the cultural and tourism industry and scenic spots. This indicates that this product has initially been recognized by the market. We will also gradually convert intended orders into confirmed orders.”

There are three main types of low-altitude economic aircraft: in addition to traditional helicopters, fixed-wing aircraft, airships, there are also drones and eVTOL. Unmanned, electric, and intelligent are the main directions. Electric vertical takeoff and landing can be divided into three mainstream configurations: multirotor, compound wing, and tiltrotor.

Muyu Tian Aviation Technology (Jiangsu) Co., Ltd. is a comprehensive enterprise integrating the research and development, manufacturing, and operation of heavy-duty compound wings and tilt-rotor eVTOL drones. It has been quietly cultivating in the field of manned aircraft and drones for 20 years, with highly vertically integrated from the whole aircraft to system components.

In 2018, Wang Yong, the founder of Muyu Tianhang Airlines, relocated the company to the Wuxi High-tech Zone Airport Economic Development Zone to prepare for mass production. Based on previous experience in the development of manned aircraft, he began to focus on heavy payload eVTOL.

Born into a family of mechanical engineers, Wang Yong has been an aviation enthusiast since childhood. In 1990, at the age of 20, Wang Yong created his first aircraft in his life - the ‘Triangular Wing’. This triangular wing also became the initial starting point of Wang Yong’s aviation career. Starting in 2004, he officially built a team to develop manned aircraft. In 2018, he fully transitioned to large unmanned aircraft, that is, the cargo eVTOL racing track.

On January 30, 2024, Mu Yu Tian successfully completed the world’s first hybrid ton-level eVTOL UAV (model: AT1280) multi-rotor to fixed-wing route flight + fixed-wing to multi-rotor mode safe landing flight test. This hybrid powered vertical take-off fixed-wing aircraft with a take-off weight of 1.3 tons and a payload design of 500 kilograms will soon go to Xinjiang for long-distance, flight testing under complex environmental conditions. To ensure flight safety as much as possible, the aircraft needs to undergo multiple test flights to accumulate flight data.

“This aircraft is being discussed by a customer for a possible purchase of ten in 2025. We are also in discussions with customers in Southeast Asia, with plans to use it as a transport vehicle between islands. If we secure this order, it will be close to 1600 aircraft, which could lead to establishing overseas subsidiaries for final assembly and delivery,” Wang Yong told the Pengpai News reporter.

As a multi-functional application platform, a 500-kilogram payload aircraft can be used for material freight, forest fire fighting, air relay, artificial rain enhancement, aerial reconnaissance and patrol, etc.

Currently, Wuxi is building a distinctive ‘low-altitude city’.

Muyu Tianhang Aviation, Daonier Haiyi and other aircraft manufacturing companies have given Wuxi a head start in the low-altitude economic race.

“Low-altitude economy covers low-altitude manufacturing, low-altitude flight, low-altitude support, and comprehensive services. The industry chain is long, with a wide radiation surface, and every city has the opportunity to explore and create a unique development model. We have done thinking and planning, and conducted surveys on industries, scenarios, and infrastructure.” Cai Yu, Deputy Director of the Low-altitude Economy Development Department of Wuxi Municipal Transportation Bureau, told The Paper that there are currently more than 150 related enterprises in the city, covering a wide range of fields such as general aviation aircraft, industrial-grade drones, sensing radar, flight control, and management platforms, initially forming an “up-down integration, overall closed-loop” industrial ecology.

At the same time, benefiting from the technological empowerment of advantageous industries such as “dual-use technology” and new materials, Wuxi has also developed related supporting enterprises such as composite materials, components, and inspection and testing, to meet the needs of local and surrounding chain enterprises. “We are also planning to build a comprehensive flight test base, providing flight test venues and testing services for related enterprises.”

The development of low-altitude economy in Wuxi is not a blind move.

“Wuxi’s manufacturing industry has a solid foundation, with a relatively large number of talents and research institutes related to low-altitude economy. As a city with profound humanistic heritage, Wuxi has also developed its tourism resources well, and traditional aviation has great advantages in cultural tourism and sightseeing. From the perspective of low-altitude scene applications, Wuxi has great potential.” Cai Yu said that in order to develop the low-altitude economy, cities should make use of their own advantages according to local conditions.

The “Three-Year Action Plan for High-Quality Development of Low-Altitude Economy in Wuxi (2024-2026)” clearly states that by 2026, the city will form a low-altitude economic industry layout with pilot areas such as Yixing Dingshu Low-Altitude Economic Industrial Park and Liangxi Science and Technology City as the support, focusing on traditional general aviation and unmanned aerial vehicles, and building a “four-in-one” low-altitude economic coordinated development system integrating research and development, manufacturing, commercial application, infrastructure, and service support. The output value of the low-altitude economic industry will exceed 30 billion yuan, becoming a new growth pole for the high-quality development of Wuxi’s social economy.

From the perspective of the plan, the future low-altitude industry agglomeration area in Wuxi will also be “leading the way” in various aspects.

For example, Yixing Dingshu General Aviation Industry Park takes the manufacturing of general aviation equipment and core components as its core, with operational services, test flights, maintenance, and sales as its features. Liangxi Science and Technology City Low-Altitude Economic Industrial Park focuses on the research and development of industrial-grade drones, with digital construction and operation management services as its features.

“Several characteristic industrial parks, according to the situation of their respective sectors, revolve around different aspects such as research and development, manufacturing, and maintenance, and develop different characteristics and differences, jointly forming the city’s full chain system.” Cai Yu said that the future development ideas are also relatively clear, that is, based on the cultivation of local key enterprises, tapping potential enterprises, encouraging capable enterprises to transform, supporting already large-scale enterprises to grow their advantages, and at the same time striving to attract a group of low-altitude economic leading enterprises with driving effects, leading and driving local enterprises’ innovative development.

Accumulate flight data and complete airworthiness certification

Unlike the zero-gravity tilt rotor, Peak Aviation Technology’s aircraft adopts a compound wing configuration.

In February and August 2024, Peak Air completed cross-city and cross-sea flights between Shenzhen and Zhuhai in the Pearl River Delta and a cross-Yangtze River flight between Nanjing and the Yangtze River Delta. These flights showcased the practical application of eVTOL aircraft in low-altitude flying scenarios, demonstrating the efficiency and convenience it brings to the public.

Global cooperation and flights are also important initiatives to establish standards and gain a first-mover advantage in the frontier technology field of eVTOL. On November 29, 2024, Peak Fly Aviation conducted a flight of a 2-ton eVTOL aircraft in Okayama, Japan, marking the first flight of a Chinese eVTOL weighing over a ton in Japan. Following the overseas maiden flight in Abu Dhabi in May, the flight in Japan at the end of November once again demonstrated the technical strength and global operational capabilities of Peak Fly Aviation.

“Overall, in 2024, the main focus will still be on completing the airworthiness certification and scene exploration process. Peak Flight’s cargo aircraft, the Kairuiou, has obtained the world’s first TC for a 2-ton eVTOL model, and the real revenue scale should start to take shape in 2025. We have some new orders, mainly focused on cargo models. The biggest goal for the new year is to normalize the logistics of certain routes and implement a commercial closed loop. We are now preparing for delivery. In addition, the airworthiness certification of our passenger model, Shengshilong, is also a key focus for 2025, and we plan to put it into commercial pilot operation after completion in 2026.” Peak Flight’s Senior Vice President Xie Jia told a reporter from The Paper that Peak Flight sells aircraft through OEM, but there are currently few companies that can operate, so Peak Flight also needs to assist downstream customers in empowering operations.

Currently, Fengfei has achieved a relatively standardized operation of ‘flying’ logistics.

On December 1, 2024, Fēngfēi Aviation Technology’s Great White Shark UAV completed the whole process of night flight island logistics delivery, taking off at 23:00, carrying plasma, emergency medical supplies, flying across the sea from Putuo, Zhoushan to Dongji Island, and then returning with the freshest yellow croaker, landing in Putuo, Zhoushan at 24:00.

This is not the first time Feng Fei has delivered ‘Fei’s’ supplies.

As early as June 24, 2020, the ‘Great White Shark’ completed the verification flight of intelligent maritime logistics. On that day, it took off from the offshore flight platform of the East China UAV Base in Jinshan Industrial Zone, flew back and forth between Da Jinshan Island and Xiao Jinshan Island, and successfully completed the aerial logistics transportation work.

The distribution of goods and low-altitude sightseeing are typical application scenarios of low-altitude economy.

At the end of 2020, Zero Gravity began its establishment. The core members of the founding team came from Nanjing University of Aeronautics and Astronautics. In May 2022, Zero Gravity chose to settle in Hefei, while the research and development center remained in Nanjing. In less than a year after settling in Hefei, the pre-production model of the electric vertical take-off and landing (eVTOL) aircraft, ‘ZG-ONE,’ was successfully launched.

Chen Yan said that the reason why “ZG-ONE” formed an intention order in the airworthiness certification stage is because the product definition is clear and the product strength can be clearly seen.

“In terms of appearance and interior, it is optimized for low-altitude sightseeing applications, and has a strong sense of science fiction. In addition, the design of battery swapping is adopted, which can be filled with electricity in less than 10 minutes, improving the efficiency of equipment. The aircraft also has a whole parachute to ensure the safety of personnel. It is also one of the highlights of the product.”

The development of low-altitude economy is a microcosm of Hefei’s layout of industrial chains around the development of new quality productive forces in recent years.

Hefei, which has gained fame with the concepts of ‘core screen automotive integration’ and ‘lifetime intelligence’, is taking off from the ‘low-altitude economy’ and is focusing on the development of ‘aerospace information’, ensuring ‘deep space exploration’, and actively exploring new tracks, cultivating new industries, and nurturing new momentum.

In the field of low-altitude economy, Hefei has clearly stated that it will spare no effort to build an “air city” with international influence, seizing new opportunities for intensive innovation and high-speed growth in the low-altitude economy.

In June 2024, the “Several Policies for Supporting Low-altitude Economic Development in Hefei” was officially issued, which will empower policies from many aspects, such as introducing leading enterprises and institutions in the low-altitude economy, supporting the research and development and transformation of key technologies in the low-altitude economy, supporting the opening of commercial normalized flight routes, creating “drone +” demonstration scenarios, supporting the construction of low-altitude economic infrastructure, supporting the construction of low-altitude economic system platforms, and creating a low-altitude economic development ecology.

Currently, Hefei has gathered more than 200 companies in the low-altitude economy field, including EHang Intelligent Technology, Zero Gravity, and other industrial chain enterprises. A series of aviation-related enterprises, such as components and communication technologies, have taken root and settled, initially forming an industrial cluster integrating research and development, manufacturing, sales, operations, and services.

For Hefei, urban development relies on technological innovation. New productivity often emerges from technological innovation.

As a new form of economy, low-altitude economy is a typical representative of new productive forces. From the ground to the sky, carrying the expectations of economic development and takeoff, it is becoming a “new engine” for cities.

Entering a new stage of development

The ecosystem of low-altitude economy involves not only policy concepts, but also reforms in the system and mechanism of airspace management, innovative application of equipment, construction of infrastructure, and development and operation of application scenarios.

The Third Plenary Session of the 20th Central Committee has put forward clear requirements for the development of low-altitude economy. In the future, there is hope for more breakthroughs in the management system and policies and regulations of low-altitude airspace. Since 2024, nearly 30 provinces across the country have included the development of the low-altitude economy in government work reports or issued related policies. Cities and enterprises such as Beijing, Shanghai, Hangzhou, and Hefei are jointly building a low-altitude economic ecosystem, planning to create hundreds of demonstration projects covering low-altitude flight routes, low-altitude application demonstration areas, and other fields by 2025. In addition, some local governments have also established special industry funds to provide a financial foundation for the development of the low-altitude economy.

"Without the fiery background and policy support of the low-altitude economy, the progress will certainly not be so fast. All aspects of support policies are in place, and the key is to gradually cultivate them and let the normalized application scenarios land. Application scenarios, at present, are not sufficiently developed. Xie Jia said that starting from the load, the operation end will gradually upgrade and iterate with the accumulation of data and experience, which will play a great role in the future manning.

Zero Gravity has recently completed a new round of financing, and the new production manufacturing base in Hefei is also about to be established. Combining the operation of the production manufacturing base, it will create a sample of a green aviation flight camp, demonstrating the application of the site and equipment.

“The full-scale prototype of the tiltrotor eVTOL aircraft ZG-T6 is about to roll off the assembly line, and part of the energy will be focused on the test flight of the prototype in 2025.” Chen Yan said, "I participated in the Zhuhai Airshow before, and many professional visitors came to the booth to negotiate with us. It has also participated in exhibitions such as the Hi-Tech Fair, gained many partners, and signed a series of cooperation agreements with upstream and downstream enterprises. ”

According to him, the company itself has also been continuously expanding in scale, recently publicly posting many job positions, and currently has more than 120 full-time employees.

“Enter a new stage of development,” said Chen Yan.

Currently, Muyu Tianhang Airlines independently designs and manufactures nearly 90% of its components. Wang Yong said that in the future, some components may be produced locally in Wuxi. Wuxi has a good foundation in machining, especially in electromechanical equipment. In the future, the supply chain will depend on price and quality control. As the industry becomes more mature, the closer the distance, the better the quality control, and the easier the communication. As the main manufacturer, the production standards for component manufacturers will be relatively strict.

Future Challenges

The low-altitude economy and other new growth engines, while hot, also face many topics to be explored.

From the perspective of industry development stages, most industry insiders believe that the industry is still in its early stages, and the market is slowly being cultivated. “There are no normalized routes operating nationwide, and most of them are still experimental demonstrations. True commercialization will have to wait for normalized flight and route operations to take off.”

As a new thing, technology, regulation, and market promotion all have necessary processes. Wang Yong said that the market still needs to be nurtured. “Seeing where the plane is being used, will gradually realize that I can use it too. When new concepts emerge, not everyone can immediately recognize the broad prospects of this market.”

The civil aviation authority and the enterprise are also in mutual communication and exploration. “The airworthiness certification process is relatively long, which will increase the financial risk for the enterprise. However, from birth to maturity, this is an inevitable process for new things.”

The hot market brings more understanding of the industry from the outside world, as well as orders. At the same time, the high enthusiasm of the market also brings a bit of trouble to practitioners who have been deeply involved for a long time.

“Digging people back and forth, the salary level of technical personnel has doubled or tripled compared to the previous two years. Those who have never worked in aviation before, the only advantage when they come in is having money. Some newly established companies outsource all aircraft design tasks, and some companies entrust headhunting companies to dig people from chief engineers to various professional engineers.”

Low-altitude economy is like running a marathon, only the strong can survive in the end.

“This process is very cruel, and there will be competition in various dimensions in the future, because it is a free market. Since this is the outcome, we have to accept this cruelty, especially since it is a field that we love.”

Wang Yong hopes to retain talents by allowing contributors to benefit from the company’s growth through the company-wide stock ownership. “As someone who loves aviation, I have this kind of broad-mindedness. Even if we are eliminated in fierce competition, we have contributed to this industry, and we believe we can accept it.”

High investment, long cycle, and high risk are the industry characteristics of low-altitude economy. Wang Yong suggested that the government should do a good job in supervision, provide policy support for market applications, such as timely opening up some application scenarios, and let companies try. “Only by using it can the industry move forward.”

He believes that the emergence of new things requires psychological expectations of government and social tolerance. ‘The development of aviation technology and airworthiness regulations over 100 years has been accompanied by blood and tears, and it is the summary of many lessons from accidents. eVTOL will inevitably go through this process.’

Wang Yong suggested to start with logistics and gradually relax restrictions in areas with relatively higher safety tolerance, such as mountainous areas, sea areas, and rural areas, and then transition to densely populated areas as technology matures.

While increasing social inclusiveness, we must also be cautious. The accumulation of flight data and the verification of whether flight operations are standardized and safe during flight require a long time.

The industry generally believes that 2024 is the first year of the low-altitude economy. “In fact, it is just getting started, and there are still many problems that need to be explored.”

Chen Yan said that in some places where the supply chain is not sound and the human resources foundation is not very complete, they also want to attract zero-gravity production and manufacturing bases or even headquarters to land. “For us, a lot of effort has been wasted in persuading and explaining. It shows that some government functional departments do not have a comprehensive and profound understanding of the low-altitude economy, and it will take some time for ideological collision before we can finally find the direction of development.”

The construction of basic conditions is not achieved overnight. ‘At present, the supply chain in the industry requires a lot of effort to meet specific requirements. The limited number of suppliers leads to high costs. We hope that more qualified first- and second-tier suppliers will emerge.’

In terms of institutional arrangements, Chen Yan hopes that at the national level, the reform of the system and mechanism of airspace management will be accelerated. In informal institutional arrangements, that is, in terms of ideology, he calls on relevant national departments, especially the departments of science and technology education, to cooperate in the development of the low-altitude economy market and the popularization of aviation culture.

Chen Yan hopes to promote the concept of low-altitude economy in counties. “Airspace and land resources are the basic production factors of the industry, and the resource endowment is better in rural areas than in cities, especially in urban built-up areas. From the perspective of application market, the demand for low-altitude economic formats in rural areas, such as agricultural production operations, emergency medical care, is also more urgent.”

(Article source: The Paper)

Source: East Money

Author: The Paper