Mid year industry observation | Low altitude economy 'poised for takeoff' opens up a new trillion dollar market track

On July 15th, the first admission letter for the 2024 college entrance examination in Guangzhou was successfully delivered by Guangzhou Post via drone; On the same day, the Meituan drone route to Huangxing Park in Shanghai entered the trial operation phase, and consumers only needed to walk to the designated drop off cabinet in the park to pick up their meals... The scene that used to be in science fiction movies is now beginning to play out in our real lives.

Since the beginning of this year, the low altitude economy has continued to 'emerge'. As a typical representative of new quality productivity, the low altitude economy is rapidly rising to become a trillion level industrial new track under the dual promotion of policy guidance and technological innovation.

What is low altitude economy?

By definition, low altitude economy is a comprehensive economic form that relies on low altitude airspace and is driven by various low altitude flight activities of manned or unmanned aircraft, radiating and driving the integrated development of related fields. Low altitude airspace usually refers to the airspace within a vertical distance of 1000 meters from the ground level directly below.

From the perspective of application scenarios, the low altitude economy has given rise to a series of "low altitude+" innovative scenarios, gradually entering daily life and empowering various industries. A drone carrying emergency blood took off from the central blood station in Ningbo, Zhejiang, and landed steadily for 12 minutes in the eastern campus of Li Huili Hospital, Ningbo Medical Center, 11 kilometers away. The entire transportation process saved more than 60% of the time compared to ground transportation; The first unmanned aerial vehicle urban air traffic operation center in China has been opened in Bao'an, Shenzhen, allowing citizens and tourists to fly and overlook Shenzhen... "Low altitude+" urban application scenarios such as air traffic, air logistics, medical rescue, and tourism are gradually landing. In addition, "low altitude+" is also widely used in non urban scenarios such as meteorological detection, ocean monitoring, and crop protection drones.

According to data released by the Civil Aviation Administration of China, as of the end of 2023, China has over 1.26 million drones, a year-on-year increase of about 32%. By 2023, civilian drones will have accumulated over 23 million flight hours. The Civil Aviation Administration of China has approved the establishment of 17 civil unmanned aerial vehicle test zones and 3 test bases, covering scenarios such as cities, islands, regional logistics, and comprehensive application expansion.

Such a rich range of innovative application scenarios for "low altitude+" will continuously give rise to new business forms and models, thus creating a huge market with a scale of trillions. The Research Report on the Development of China's Low altitude Economy (2024) shows that the scale of China's low altitude economy will reach 505.95 billion yuan in 2023, with a growth rate of 33.8%. Optimistically, it is expected that by 2026, the scale of low altitude economy will exceed one trillion yuan.

Why is the low altitude economy taking off?

Although the low altitude economy has become a new trend this year, its "takeoff" is backed by years of industrial accumulation. Especially in recent years, with increased policy support and innovation driven by 5G-A technology, sufficient preparations have been made for the takeoff of the low altitude economy.

In terms of policy, in 2016, the General Office of the State Council issued the "Guiding Opinions on Promoting the Development of General Aviation Industry", proposing to expand the opening of low altitude airspace and pave the way for the subsequent development of low altitude economy. In February 2021, the concept of low altitude economy was officially proposed in the National Comprehensive Three dimensional Transportation Network Planning Outline. Subsequently, the Central Economic Work Conference held at the end of 2023 proposed to develop several strategic emerging industries such as biomanufacturing, commercial aerospace, and low altitude economy. This year, the low altitude economy, as one of the "new growth engines", has been included in the "Government Work Report" and has received unprecedented heat. In March, the Ministry of Industry and Information Technology and four other departments jointly released the "Implementation Plan for Innovative Applications of General Aviation Equipment (2024-2030)", proposing to promote the large-scale development of "low altitude+logistics distribution", "low altitude+urban air traffic", "low altitude+emergency rescue" and other technologies.

The reporter noticed that in addition to the "Government Work Report" and relevant plans from multiple ministries, many parts of the country have included low altitude economy as a key industry in government planning. According to incomplete statistics, 29 provinces (autonomous regions, municipalities directly under the central government) have included "low altitude economy" in the 2024 Government Work Report. In addition, Shenzhen, Beijing, Hefei and other places have launched a "timetable" for the development of low altitude economy, and introduced policies to support the development of low altitude economy and ecological construction.

In terms of technology, 5G-A new generation communication technology provides strong technical support for the development of low altitude economy, effectively promoting the intelligent, interconnected, and industrialized development of airspace. The advantages of 5G-A, such as higher speed, larger connectivity, and lower latency, can provide more stable communication support for low altitude flights. The 5G-A integrated sensing technology has achieved the integration of communication and perception, greatly improving the tracking and management capabilities of low altitude aircraft. It enables precise perception of flight data such as trajectory, speed, latitude and longitude of low altitude drones, realizes low altitude safety monitoring and "black flight" control, and provides strong technical support for the opening of low altitude airspace and the application of drones in logistics, transportation, emergency response, plant protection, surveying and other scenarios.

How can low altitude economy fly more steadily and further?

Currently, China's low altitude economy is accelerating its takeoff, but the industry as a whole is still in its early stages, and there are few large-scale application scenarios. How can the lively low altitude economy 'fly more steadily and further'?

In order to promote the coordinated development of industries, various low altitude economic industry alliances have emerged.

Since the beginning of this year, regional industrial alliances have been established in some pilot areas for low altitude economic development. On May 15th, the Beijing Low altitude Economy Industry Development Alliance announced its establishment, which will gather upstream and downstream resources in the industrial chain, break through key core technologies in the low altitude economy field, accelerate the transformation of scientific and technological achievements, and promote the construction of industrial standard system. On July 4th, the Guangdong Hong Kong Macao Greater Bay Area Low altitude Economic Industry Alliance was established, committed to promoting system construction, strengthening industry docking, providing consulting advice, promoting industry university research cooperation, and carrying out international cooperation.

As an important part of the industrial chain, communication operators are also competing to layout in the low altitude economy field. On June 17th, the China Telecom Low altitude Economy Industry Alliance was officially established and released the "Low altitude Navigator" action plan. The alliance will coordinate various forces such as industry, academia, and research to jointly cultivate the industrial ecology and promote the accelerated industrialization of low altitude economy. In June of this year, China Mobile and its partners jointly released the top ten low altitude connected application scenarios; China Unicom has also recently stated that it will continue to explore innovative technology solutions such as integrated sensing and sky ground integration, contributing wisdom to supporting the development of low altitude economy and building a seamless spatial coverage network.

Not long ago, the national low altitude economy industry alliance, the China Low altitude Economy Alliance, was established. The alliance was jointly initiated and established by more than 100 upstream and downstream enterprises and industry research institutions in the low altitude economy. It will conduct in-depth research on the development laws of the low altitude economy, rapidly expand application scenarios, find the best path, business model, and technological route for the development of China's low altitude economy, and promote industry cooperation and development.

The establishment of various industrial alliances will promote cooperation between upstream and downstream enterprises in technological innovation, application scenario expansion, safety supervision, and other aspects of the industrial chain, and explore the path for China's low altitude economy to fly more steadily and further.

The future is here, the blue ocean is boundless. Currently, the development of low altitude economy has a strong momentum and broad prospects. The low altitude economy is accelerating its integration into various industries, stimulating new driving forces for future industrial development, and taking advantage of the situation to soar high!