The Zhitong Finance App learned that Dongwu Securities released a research report saying that at present, the general aviation industry is still the main player in the low-altitude economy, but as drones penetrate various industries more and more widely, they are beginning to dominate the development of the low-altitude economy. At the same time, with the continuous development of various upstream materials and midstream accessories, eVTOL aircraft (electric vertical take-off and landing aircraft) are being launched. On May 31, 2023, the State Council and the Central Military Commission promulgated the “Interim Regulations on the Administration of Unmanned Aircraft Flight”, which came into effect on January 1, 2024. This marks that China's drone industry will enter a new stage of standardized development with “laws to follow” and is expected to be the first year of development of the low-altitude economy.

Related target: Low-altitude informatization is the digital foundation for a large-scale low-altitude economy, so it has great potential and opportunities for future development. Low-altitude informatization mainly includes low-altitude management systems, drone graphic display control, etc., air traffic control systems: Rice Information (688631.SH), Shenzhen Transit (301091.SZ), Sichuan University Zhisheng (002253.SZ); graphic display control system: Jingjiawei (300474.SZ); other links: Jiaxun Feihong (300213.SZ) (command and dispatch system), Leber Technology (002577.SZ) (holding drone company zero degree intelligence), etc.

The views of Soochow Securities are as follows:

The low-altitude economy is a new type of economy where low-altitude flight activities and industry are integrated:

Low-altitude economy refers to a comprehensive economic form that relies on low-altitude airspace (airspace within 3,000 meters), is driven by various low-altitude flight activities of various manned and unmanned aerial vehicles, and radiation-driven integrated development in related fields. It has the characteristics of a long industrial chain, wide radiation coverage, growth and driving force. Application scenarios of the low altitude economy include low altitude economy+agriculture, low altitude economy+inspection, low altitude economy+fire fighting, low altitude economy+logistics, etc. Innovative applications are constantly being developed. Many companies, such as SF Express and Meituan, are carrying out low-altitude flight pilot experiments to promote drone terminal delivery services.

As one of the important carriers of the future low-altitude economy, eVTOL's market potential exceeds trillion US dollars.

Currently, the general aviation industry is still the main player in the low-altitude economy, but as drones penetrate various industries more and more widely, they are beginning to dominate the development of the low-altitude economy. At the same time, with the continuous development of various upstream materials and midstream accessories, eVTOL aircraft (electric vertical take-off and landing aircraft) are being launched. In 2023, four departments including the Ministry of Industry and Information Technology issued the “Green Aviation Manufacturing Development Outline (2023-2035)”, which clearly states that eVTOL will be piloted by 2025; a complete, advanced and safe green aviation manufacturing system will be built by 2035. Morgan Stanley predicts that the eVTOL market for autonomous driving could reach $1.5 trillion by 2040.

The global low-altitude economy is in the early stages of cultivation and has great potential.

The global low-altitude economy has gone through an early stage of application exploration, a stage of standardized development, and a stage of widespread application. Judging from the regional development pattern of the global low-altitude economy, the United States is leading the world in general aviation, establishing its first-mover advantage in the low-altitude economy. China, on the other hand, is leading the US in the field of drones. Currently, the low-altitude economies of all countries are in the early stages of development and are still in the active exploration stage. Overall, they are all mainly based on top-level national design, local government leadership, and actual construction carried out by market players.

2024 is expected to be the first year of domestic low-altitude economic development.

Since 2010, the country has successively promulgated a series of policies and regulations to promote low-altitude economic development, and the concept of “low-altitude economy” was incorporated into the national plan for the first time in 2021. Expenses from the 2023 Central Economic Work Conference will build a number of strategic emerging industries such as biomantry, commercial aerospace, and low-altitude economy. On May 31, 2023, the State Council and the Central Military Commission promulgated the “Interim Regulations on the Administration of Unmanned Aircraft Flight”, which came into effect on January 1, 2024. This marks that China's drone industry will enter a new stage of standardized development with “laws to follow” and is expected to be the first year of development of the low-altitude economy. It is estimated that by 2035, the central government's industrial scale for the country's low-altitude economy will reach more than 6 trillion yuan.

Shenzhen has an annual output value of nearly 100 billion yuan of drones, leading the country in policy.

By the end of 2023, Shenzhen has a mature and complete drone industry chain. Consumer drones account for 70% of the global market share, and industrial-grade drones account for 50% of the global market share, leading the world. According to information from the 9th Drone 100 People's Conference, by the end of 2023, the annual drone output value in Shenzhen was 96 billion yuan, an increase of 28%; in 2023, Shenzhen opened 77 new drone routes, built 73 drone take-off and landing points, and completed 600,000 cargo drone flights, making it the largest flight scale in the country. At the beginning of 2024, Shenzhen introduced the country's first special regulation “Shenzhen Special Economic Zone Low Altitude Economy Industry Promotion Regulations”, which will be implemented on February 1, and is expected to lead the country's low-altitude economy industry.

Risk warning: Policy progress falls short of expectations, technological progress falls short of expectations, competition intensifies the impact.