Summary of Key Points
Recently, domestic and international automakers have been actively entering the low-altitude economy sector (especially in the field of electric vertical takeoff and landing aircraft, or eVTOLs), competing for market share through direct establishment of subsidiaries, capital investment, and technical cooperation. There are two main driving forces behind this trend: firstly, the high degree of overlap between the automotive and low-altitude aircraft industry chains (parts and manufacturing systems can be shared); secondly, the intense competition in the automotive market, with the low-altitude economy representing a new growth opportunity worth trillions of dollars. The low-altitude economy has moved from being a concept to a practical reality, becoming a new battleground for the automotive industry.
How Are Automakers Positioned in the Low-Altitude Economy?
At the recent Shanghai Low-Altitude Expo, automakers were prominently represented:
- Geely: Directly owns WoFei ChangKong (the only eVTOL vehicle exhibitor at the expo) and has signed an agreement with Shanghai XiaoXiang to purchase additional aircraft. Together, they plan to operate the vehicles, train personnel, and provide maintenance support.
- Xpeng: Its subsidiary Xpeng HuiTian already has two flight product systems.
- GAC: Has incubated Gaoyu Technology, which is developing both short-range multi-rotor and long-range composite-wing aircraft.
- FAW: Established QiYi Technology, and the prototype of the HongQi “TianNian 1” has obtained flight permits from the civil aviation authorities.
- SAIC and NIO: Have invested in WoLanTe Aviation through their respective venture capital funds.
- International Automakers: Toyota has formed a joint venture with the American eVTOL company Joby to get directly involved in this industry.
Some companies also brought their automotive expertise to the expo:
- For example, the founder of ShiShi Technology previously worked at Geely Taili Flying Cars and applied new energy vehicle technology to their development.
- LanYi Aviation collaborated with ZhongXinChuangHang, a battery company, to develop aircraft batteries.
- ZhongHe Technology is using automotive lidar in their low-altitude aircraft.
Why Are Automakers Interested in the Low-Altitude Economy?
Automakers' entry into this sector is not just for the sake of following trends; there are tangible benefits:
1. Industry Chain Synergies: Many technologies and parts used in electric vehicles can also be applied to flying cars. For instance, GAC Gaoyu states that 70%-80% of the supply chain and manufacturing processes for flying cars are similar to those of regular cars; WoLanTe Aviation uses about 30%-40% of its parts from the automotive industry, saving time and costs.
2. New Business Opportunities: The automotive market is highly competitive, with continuous price wars leading to thin profits. The low-altitude economy, with a potential market size of trillions, presents a new growth opportunity. According to predictions by the National Information Center, the market will exceed 1 trillion yuan by 2026 and reach 3.5 trillion yuan by 2035. Automakers see this as a chance to expand their business and create a second growth trajectory.
Highlights of the Expo: From Concept to Practical Action
The expo was more than just about displaying models; it saw real deals being made:
- WoFei ChangKong + Shanghai XiaoXiang: Signed an agreement to collaborate on three key areas: scenario-based operations, talent training (for pilots and maintenance personnel), and maintenance support, all aimed at advancing the commercialization of eVTOLs.
- Cross-Industry Technology Integration: LanYi Aviation and ZhongXinChuangHang jointly developed aircraft batteries to improve flight range; ZhongHe Technology applied automotive lidar technology to enhance aircraft visibility; ShiShi Technology leveraged their experience in new energy vehicles for aircraft development.
The Promise of the Low-Altitude Economy: Policy Support and Market Potential
The low-altitude economy is not just a theoretical concept; it has solid policy and market backing:
- Policy Shift: The 14th Five-Year Plan explicitly supports the development of the low-altitude economy. Policies have shifted from focusing on feasibility to addressing how to operate and manage these aircraft. Many eVTOL models have received certification, indicating closer commercialization.
- Market Growth: With a projected market size of over 1 trillion yuan by 2026 and 3.5 trillion yuan by 2035, the low-altitude economy is as significant as the current new energy vehicle market (which grew to over 9.49 million units sold in China in 2023, with a market value of over one trillion yuan), representing a lucrative opportunity for automakers.
The New Direction for the Automotive Industry: From Ground to Air
Automakers are moving beyond traditional car manufacturing towards integrated ground and air transportation solutions. From Geely's direct investment in WoFei ChangKong to SAIC and NIO's capital involvement, the automotive industry chain is expanding from “making cars” to “manufacturing and operating flying vehicles.” In the future, you might be able to use the same company for both driving on land and flying in the air. The low-altitude economy has become the next battleground in the automotive industry.
(I've tried to keep the translation clear and easy to understand, without using too much technical jargon.)