Visitors look at an aircraft at the low-altitude economy exhibition area at the World Intelligence Expo 2024 in north China's Tianjin, June 20, 2024. (Xinhua/Sun Fanyue)
BEIJING, Aug. 8 (Xinhua) -- XPENG AEROHT, an affiliate of electric vehicle maker XPENG on August 5 announced it had secured 150 million U.S. dollars in Series B1 financing and would build a flying car factory in the Guangzhou Development District.
This year has seen low-altitude economy rising in popularity, with eVTOL (electric vertical takeoff and landing) becoming a hot track. Leading enterprises such as TCab Tech, Volant Aerotech, Aerofugia, and AutoFlight have all secured large scale financing.
Driven by diverse application scenarios and supporting environment, the commercialization of new business models featuring "low-altitude economy+" is accelerating.
-- Intensive Investment
XPENG AEROHT on August 5 announced it had secured 150 million U.S. dollars in Series B1 financing and initiated Series B2 financing. The company stated that the funds would be used to ensure the research and development (R&D), mass production, and commercialization process of its flying cars.
Low-altitude economy has been thriving this year. As a crucial carrier of low-altitude flight activities, eVTOL has become a highly sought-after sector by investment institutions, with several leading enterprises securing large scale financing.
The eVTOL requires lengthy R&D as well as substantial investment. Industry insiders reveal that it takes approximately one billion yuan for a domestic eVTOL to complete R&D, testing, and certification.
Contemporary Amperex Technology Co., Limited (CATL) and AutoFlight signed a strategic investment and cooperation deal on August 3, under which CATL will exclusively invest several hundred million U.S. dollars, becoming a strategic investor in AutoFlight. AutoFlight noted that it would collaborate with CATL to focus on eVTOL aviation battery R&D.
Earlier on June 27, Aerofugia announced the completion of its Series B financing worth several hundred million yuan, with investment led by Orinno Capital. The funds will primarily be used for the R&D and commercialization of its fully self-developed AE200, accelerating the implementation of urban air mobility. Later in July, Aerofugia received a strategic investment from Chengdu major industrialization project investment fund under Chengdu Capital Group Co., Ltd.
TCab Tech also announced this March the completion of a 20-million U.S. dollar Series A strategic financing, exclusively invested by an overseas investment institution. The company plans to create an "air taxi" application scenario in the Middle East region. TCab Tech noted that the funds will be used to accelerate product R&D and relevant certification process.
According to a white paper released by CCID, eVTOL manufacturing in China saw the most investment and financing go after the tilt-rotor configuration technology in 2023. In terms of investment amount, the multi-rotor configuration eVTOL received the largest investment and financing due to its lower technical risks and development difficulties, allowing for quicker industrialization, the think tank noted.
-- Diverse Applications
Data released by the Civil Aviation Administration of China shows that China's low-altitude economy exceeded 500 billion yuan in 2023 and is expected to reach 2 trillion yuan by 2030.
The low-altitude economy mainly covers low-altitude infrastructure, low-altitude vehicle manufacturing, low-altitude services, and low-altitude flight support. Currently, the low-altitude vehicle manufacturing and low-altitude services made the largest or nearly 55 percent contribution to the strategic emerging industry with diverse applications.
On August 5, XPENG AEROHT announced to establish a flying car factory in the Guangzhou Development District to produce the flying part of its modular flying car, the "Land Aircraft Carrier".
The "Land Aircraft Carrier" currently plans to open to booking in the fourth quarter of 2024, according to a report by China Securities Journal. It is noted that the "Land Aircraft Carrier" consists of a ground module and an air module. The ground module can fully accommodate the air module in ground driving.
For commercialization, industry insiders note that low-altitude economy plus cultural tourism is currently taken by most eVTOL manufacturers as initial step.
He Tianxing, EHang Intelligent Technology Vice President, told that the company's "three-step" plan for commercialization includes: The first phase focuses on aerial tourism, cultural tourism, and urban sightseeing, with commercialization applied in domestic scenic spots and suburban areas; The second phase involves cooperation with local governments and industrial investment groups to develop ground infrastructure in key cities; The third phase aims to implement autonomous "air taxi" services, making aerial commuting a convenient service that the public can accept and is willing to use.
It is noted that EHang Intelligent Technology has currently delivered EH216-S pilotless passenger aircraft to multiple locations including Zhuhai in Guangdong, Taiyuan in Shanxi, Wenzhou in Zhejiang, and Wuxi in Jiangsu, promoting manned test flights and demonstration operations for cultural tourism and sightseeing services.
Low-altitude vehicles such as eVTOLs and drones can also be widely used in logistics, emergency rescue, agricultural planting, and safety inspections.
For instance, Meituan Drone had opened 31 routes in cities such as Shanghai, Shenzhen, and Guangzhou, completing over 300,000 orders as of the end of June 2024. Drones from brands like XAG and DJI have been widely involved in agricultural activities. According to the latest research report from QYResearch, the global agricultural drone market size is expected to reach 13.73 billion U.S. dollars by 2030, with a compound annual growth rate of approximately 17.4 percent.
-- Supporting environment
The roll-out of relevant policies and local planning also support the enthusiasm for low-altitude economy.
The State Council released a guideline on boosting high-quality development of service consumption on August 3, promoting the integrated development of business, travel, culture, sports, and health, an improved sense of experience and interactivity, the launch of various special tourism products, and the development of new business forms such as cruise ships and yachts, RV camping, and low-altitude flight.
The development and reform commission of Shenzhen municipality unveiled on August 2 the Shenzhen Municipal Plan for Constructing High-quality Taking-off/Landing Facilities for Low-altitude Flight (2024-2025). According to the plan, Shenzhen aims to develop a hierarchical and well-structured low-altitude takeoff and landing service system, and establish a network comprising helicopter/eVTOL passenger transport, logistics transport, community delivery, and public governance services. The plan aspires to construct over 1,000 low-altitude aircraft takeoff and landing platforms by the end of 2025.
In the meantime, cities such as Hangzhou and Zhengzhou have also introduced relevant policies to promote the development of the low-altitude economy.
Hangzhou's high-quality development plan on low-altitude economy aims more than ten leading or key enterprises to be fostered, over 600 industry chain-related enterprises be introduced and cultivated, with industry scale to exceed 60 billion yuan by 2027. More than 275 low-altitude aircraft takeoff and landing sites (points) will be built by then with over 500 low-altitude routes opened.
Zhengzhou's action plan for accelerating the innovative development of low-altitude economy for 2024-2026 proposes that more than five complete drone enterprises and over 20 core industry chain enterprises will be introduced or cultivated by 2026 with the number of low-altitude economy-related enterprises exceed 200 and the industry scale surpass 20 billion yuan.
Rizhao's low-altitude economy innovative development plan for 2024-2026 note that the city will leverage its advantage of 23,000 sq. km low-altitude airspace to construct more than 20 temporary takeoff and landing sites or points, and build more than five aviation flight camps. More than 20 low-altitude R&D and manufacturing enterprises will be introduced by 2026, according to the plan. (Edited by Niu Huizhe with Xinhua Silk Road, niuhuizhe@xinhua.org)
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