Get ready for a thrilling ride as we explore the exciting, yet turbulent, world of China's flying taxis!
Imagine an oval-shaped craft, resembling a mini-helicopter, hovering noisily over a riverside innovation zone in Guangzhou. This is no scene from a sci-fi movie; it's a real-life trial of a flying taxi, brought to you by EHang. But here's where it gets controversial: while these innovative modes of transportation are gaining traction, they're facing some serious headwinds.
In nearby Shenzhen, food-delivery drones have already become a part of daily life, even if they come at a premium. Tourists like Karolina Trzciańska and her friends are eager to give it a go, ordering bubble tea and lemon tea via their phones just to experience this novel way of getting their drinks. And it's not just about the convenience; it's an adventure! "This is the first time I've seen something like this," Karolina exclaimed, "it was super fun to watch the drone deliver our food."
Supported by the government, these businesses are growing rapidly. However, the so-called "low-altitude economy" is encountering obstacles, such as strict airspace controls and battery limitations. But the potential is huge: activities in airspace below 1,000 meters accounted for a business turnover of 506 billion yuan ($70 billion) in 2023, and this is expected to skyrocket to 3.5 trillion yuan (about $490 billion) by 2035, according to Zhang Xiaolan, a researcher at the State Information Center.
Guangdong province, home to drone giant DJI, is leading the way in developing the low-altitude economy, followed by the wealthy coastal provinces of Jiangsu and Zhejiang. Other key players in Guangdong include EHang, SF Express's drone division Phoenix Wings, and XPENG's flying car unit ARIDGE. In October, Guangdong announced plans to accelerate the construction of flight service stations and platforms, and even support local discount vouchers for low-altitude tourism.
Shenzhen, a technology and financial hub, is offering a 15-million-yuan ($2.1 million) award to companies that earn certifications for passenger eVTOLs (electric vertical take-off and landing vehicles). China's Civil Aviation Administration has already granted certificates to EHang, allowing them to offer commercial passenger services with their pilotless eVTOL, which can reach speeds of 130 kph (81 mph) and has a maximum range of 30 kilometers (19 miles).
EHang hasn't launched commercial routes yet, but their vice president, He Tianxing, says they aim to start with aerial sightseeing services. The company has been busy building takeoff and landing sites in 20 Chinese cities over the past two years. He expects that in five years, aircraft from various companies will be flying multiple routes.
He envisions a citywide network, using the rooftops of malls, schools, and parks as terminals. "It can't just be a research product or an engineer's toy," he emphasizes.
The biggest challenge for developing eVTOL aircraft is maintaining longer flights and overcoming battery capacity limitations, according to Guo Liming, co-founder of Skyevtol. Their single-seat manned eVTOL aircraft, priced at around $100,000, can only fly for 20 to 30 minutes before needing a recharge.
It hasn't all been smooth sailing, though. In September, two of XPENG's eVTOL aircraft collided after a rehearsal for an exhibition, and one caught fire during landing. The company assured that no one was hurt, but another expo canceled flying demonstrations a week later. Despite this setback, XPENG remains undeterred, continuing to showcase their flying cars, including a six-wheeled ground vehicle with a detachable eVTOL aircraft. With over $600 million invested, they have more than 7,000 global orders for their "Land Aircraft Carrier" and are preparing for mass production.
A trial run of sightseeing flights is planned for July 2024 in Dunhuang, a key ancient Silk Road destination known for its Buddhist caves and dunes. However, it's unclear how soon these aircraft will begin carrying paid passengers regularly. Some companies elsewhere have run out of funding before even reaching the commercial launch stage. In Germany, air taxi makers Lilium and Volocopter filed for bankruptcy, although the latter was later acquired by Diamond Aircraft Group, a subsidiary of a Chinese firm.
After years of commercialization efforts, drone applications in China are not as widespread as one might expect. Despite leading in drone technology and manufacturing, policy constraints, including limited airspace access, may mean overseas markets are more promising, according to Frank Zhou, managing director at GBA Low Altitude Technology Co. He believes that some Southeast Asian countries could have a high demand for these applications.
Less than one-third of China's low-altitude airspace was accessible for general aviation use in 2023, and there were issues with uneven distribution and a lack of internet connectivity, according to Zhang's report. The number of registered general aviation aerodromes in China, excluding private airports, was just about a tenth of those in the U.S.
Chinese policymakers are working to address these gaps. The military, which generally commands most Chinese airspace, has pledged to simplify approval procedures and shorten review times in Shenzhen and five other provinces. Proposed revisions to the civil aviation law include a chapter on developing and promoting civilian activities, addressing low-altitude airspace allocation and supervision.
Gary Ng, a senior economist at Natixis Corporate and Investment Banking, believes it's still early days. He expects progress towards commercialization to materialize around 2030, with passenger-carrying eVTOLs for tourism or industrial purposes starting before flying taxi services. Some of these aerial products could become key exports, he predicts.
Chen Wen-hua, director at the Hong Kong Polytechnic University's Research Centre for Low Altitude Economy, says China is a latecomer to the industry but now leads in developing small drones and low-altitude airspace investments. One advantage, he notes, is the ruling Communist Party's ability to mobilize regulators, industry players, and universities to work towards a common goal. However, the development of these technologies, safety concerns, and public acceptance will determine how quickly different applications of drones and low-flying vehicles are adopted.
The future for the low-altitude economy looks bright, but Chen warns, "the road leading to that bright future might be treacherous."
What do you think? Will China's flying taxis take off, or will they remain a novelty? Share your thoughts in the comments!
