Low-altitude Economy: An Emerging and Comprehensive Economic Format

In 2024, the "low-altitude economy" has emerged as a dark horse and become a hot topic. Many cities have successively issued relevant policy documents and actively explored its development path, attracting widespread attention. So, what exactly is the low-altitude economy?

Definition and Constituent Elements of the Low-Altitude Economy

The low-altitude economy refers to the normalized low-altitude flight commercial formats and industrial clusters formed in the airspace below 3,000 meters, mainly below 1,000 meters. Relying on the low-altitude airspace and driven by normalized low-altitude flight activities, it radiates and drives related fields to form a comprehensive economic format. Its formation requires four major elements: low-altitude airspace, aircraft, commercial behavior (market demand), and infrastructure. The opening of low-altitude airspace is the foundation, providing space for low-altitude flight; aircraft are the key tools for realizing the low-altitude economy, such as drones, small aircraft, eVTOL, etc.; commercial behavior and market demand are the core driving forces of the low-altitude economy. Only when there is market demand can commercial value be formed; infrastructure includes general airports, temporary take-off and landing points, communication signal systems, air safety management systems, etc., which are important supports for the development of the low-altitude economy.
Policy Background of the Low-Altitude Economy

Although there is currently no complete systematic document at the national level, the central government has mentioned the low-altitude economy many times since 2023. In December 2023, the Central Economic Work Conference proposed to build strategic emerging industries such as the low-altitude economy; on January 1, 2024, the "Interim Regulations on the Flight Management of Unmanned Aerial Vehicles" came into effect to ensure the flight of drones; in February 2024, the Fourth Meeting of the Central Finance and Economics Commission encouraged the development of a new logistics model combining the low-altitude economy and unmanned driving; on March 5, 2024, the "Government Work Report" listed the low-altitude economy as one of the new growth engines; on March 27, 2024, multiple departments jointly issued the "Implementation Plan for the Innovation and Application of General Aviation Equipment (2024 - 2030)" to provide support for the low-altitude economy; on July 21, 2024, the documents reviewed and passed by the Third Plenary Session of the 20th CPC Central Committee clearly proposed to develop general aviation and the low-altitude economy; on July 30, 2024, the collective learning meeting of the Central Political Bureau emphasized promoting the healthy development of the low-altitude economy. These policies reflect the important position of the low-altitude economy as a national strategy and provide strong support for its development.
The Low-Altitude Economy and the Function Transformation of Relevant Departments and the Civil Aviation Administration

The development of the low-altitude economy requires the cooperation of multiple departments, including the Ministry of Transport, the Civil Aviation Administration, the Ministry of Industry and Information Technology, the National Development and Reform Commission, the Central Air Traffic Control Office, the Ministry of Public Security, the Ministry of Science and Technology, the Ministry of Finance, etc. Among them, the work undertaken by the Civil Aviation Administration covers about 70% of the main body of the low-altitude economy, and its functions will change with the development of the low-altitude economy, shifting from simply civil aviation management work to a combination of civil aviation management and the low-altitude economy. In July 2024, the Civil Aviation Administration established a leading group and working groups to promote the development of the low-altitude economy, clarified relevant responsibilities, and will focus on five aspects of work: the construction of the airworthiness certification system, the improvement of infrastructure construction standards, the construction of the low-altitude service guarantee system, the strengthening of safety operation supervision, and the standardization of market management to promote the high-quality development of the low-altitude economy.
The Significance of the Low-Altitude Economy

A New Engine for Economic Growth: The low-altitude economy is one of the few emerging formats covering the primary, secondary, and tertiary industries. It can activate three-dimensional space resources. It is estimated that the market scale will reach 1.5 trillion yuan by 2025 and 3.5 trillion yuan by 2035, becoming an important force in stimulating domestic demand and transforming the economic growth mode. Especially in the context of challenges in Sino-US trade and a reduction in exports, its role in expanding domestic demand and promoting economic growth is more prominent.
Promoting Technological Innovation and Industrial Upgrading: As a unique economic format in China, the low-altitude economy promotes the combination of low-altitude aircraft such as drones with new technologies, spawning low-altitude flight equipment enterprises with independent intellectual property rights and related supporting industries, forming an industrial chain and an ecological chain, and promoting the adjustment of the economic structure and the transformation and upgrading of traditional industries.
Changing Life and Production Modes: As an important part of the three-dimensional transportation, low-altitude aircraft can shorten the time and space distance, improve production efficiency and the quality of life. For example, logistics and express delivery enterprises can significantly shorten the delivery time, increase business volume, and improve efficiency. At the same time, it can also create new industries and employment opportunities, liberate the labor force, and its application scenarios are extensive, covering multiple fields.
The Reason Why There is No Low-Altitude Economy in the US and the Reason for China to Develop the Low-Altitude Economy

There is no such thing as a low-altitude economy in developed countries such as Europe and the US. Because their general aviation industries are developed and private aircraft are popular, the airspace around 3,000 meters has been fully opened, and they have directly entered the era of general aviation. In the past, most of the general aviation airports built in China were not profitable because the airspace was not opened and the management did not keep up. Moreover, China's per capita GDP has just entered the level of a moderately developed country, and the number of private aircraft is limited. In contrast, the low-altitude economy is more in line with China's current national conditions, is closer to us, and the demand is more urgent. In addition, China has a certain foundation in low-altitude aircraft equipment such as drones, and the development of the low-altitude economy is feasible and has great potential.
The Relationship between the Low-Altitude Economy and General Aviation

People often confuse the concepts of the low-altitude economy and general aviation. In fact, they are both related and different. In the early stage, the government's competent departments regarded the low-altitude economy as a part of general aviation, and recently they have gradually placed the two side by side. The low-altitude economy is an important supplement to general aviation, and the connotations and extensions of the two will change at different stages. General aviation focuses on medium and long-distance flight activities and related industries, while the low-altitude economy focuses more on the commercial formats and industrial clusters in the low-altitude field. With the in-depth progress of the low-altitude economy, the definition of its relationship with general aviation will become clearer.

In conclusion, as an emerging economic format, the low-altitude economy has broad development prospects and important strategic significance. China should seize the opportunity, give full play to its own advantages, strengthen policy guidance and support, and promote the healthy and rapid development of the low-altitude economy to inject new impetus into economic growth and social progress.