The low-altitude economy has emerged as a pivotal national strategy in China, with unmanned aerial vehicles (UAVs), commonly known as drones, positioned as the core engine driving this transformative sector. In 2024, China’s government work report formally incorporated the low-altitude economy for the first time, signaling a strategic shift towards harnessing aerial potential. Responding to this momentum, Jinan, a key industrial hub in Shandong Province, formulated the “Jinan Low-Altitude Economy High-Quality Development Implementation Plan” in November 2024, outlining a three-year development roadmap. The 2025 Jinan Municipal Government Work Report explicitly prioritized seizing the high ground in the low-altitude economy. As the China UAV drone industry gains traction, Jinan is accelerating its industrial layout, leveraging drones as the most mature and scalable载体 for low-altitude economic activities. This report delves into Jinan’s current standing, challenges, and strategic pathways in the competitive landscape of the China UAV drone market.
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The Booming China UAV Drone Industry: A Surge in Market Entrants
The low-altitude economy in China is experiencing unprecedented growth, with the China UAV drone sector at its forefront. According to Qichacha data, Shandong Province hosts 6,682 existing low-altitude economy-related enterprises. In 2024, the province registered 1,027 new such enterprises, representing an 11.63% year-on-year increase. The first quarter of 2025 alone saw 576 registrations, a staggering 160.63% growth compared to the same period last year. Within Shandong, Jinan and Qingdao lead in enterprise distribution, with 1,354 and 1,019 existing enterprises, respectively, followed by Linyi (547), Weifang (453), and Yantai (446). This explosive growth underscores the heated competition and optimism surrounding the China UAV drone industry.
In Jinan, the frenzy is palpable. A recent example involves a local information technology listed company that purchased a 5-kilometer low-altitude route in Tai’an City and partnered with a Beijing-based low-altitude tech firm to establish a new venture. “We haven’t fully clarified our specific business operations yet; we might start with drone training and tourism services. The low-altitude economy is so hot that we decided to enter the market first and figure out the details later,” the CEO remarked, reflecting a common “enter now, strategize later” mentality among investors. This approach, while fueling rapid expansion, also highlights the nascent and exploratory phase of many ventures in the China UAV drone domain.
The training sector exemplifies this boom. Bao Shijie, founder of Shandong Fengyun General Aviation Co., based in the Taihao (Jinan) Intelligent Technology Industrial Park, noted, “Back in 2019, there were only about 20 drone training companies in Jinan. Now, that number has soared to over 200—a tenfold expansion in five years.” He attributed this surge to individuals and firms rushing into the low-altitude economy, only to find high technical barriers in drone design, manufacturing, and application. Consequently, many gravitate towards the relatively lower-entry threshold of training, intensifying competition in this segment. The proliferation of training centers signals both opportunity and saturation, as the China UAV drone market matures.
Low-Altitude Economy Enterprise Distribution in Shandong Province (2025 Q1 Data) City Number of Existing Enterprises Remarks Jinan 1,354 Leading hub for China UAV drone activities Qingdao 1,019 Strong presence in maritime and industrial drones Linyi 547 Growing regional player Weifang 453 Focus on agricultural and logistics applications Yantai 446 Emerging center for drone components This rapid influx of enterprises is reshaping Jinan’s economic landscape, with the China UAV drone industry attracting diverse investments. However, the market’s volatility requires careful navigation. As start-ups and established firms jostle for position, the need for robust regulatory frameworks and standardized operations becomes critical to sustain growth in the China UAV drone sector.
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Segmented Realities: Uneven Development in the China UAV Drone Market
While the overall China UAV drone industry is booming, its segments exhibit stark contrasts in maturity and competition. Agricultural drones, for instance, have seen market consolidation. Bao Shijie’s Fengyun General Aviation initially engaged in drone assembly and agricultural plant protection but pivoted to forestry applications after industry giants like DJI and XAG captured over 90% of the agricultural market. “DJI’s products offered superior performance at lower prices, quickly dominating the space,” Bao explained. His company developed the “Yushu Linfeng Spraying System,” a patented technology that enabled a strategic partnership with DJI, combining their products to address forestry needs. To date, Fengyun General Aviation has covered 3.1 million mu (approximately 206,667 hectares) in forestry防治 and facilitated equipment sales for 50 million mu (about 3.33 million hectares) of operations. This adaptation highlights how niche applications can thrive in the competitive China UAV drone ecosystem.
In manufacturing, smaller firms are carving out spaces through innovation. At the same industrial park, Ren Enchang, from Shandong Dapeng Aviation Technology Co., Ltd., is assembling training drones to fulfill an order of over 30 units. “Our company may be small, but we hold our own发明专利 and independently design and model core components, outsourcing production to factories. Our drones are performance-driven and in high demand,” he shared. In 2024, the company produced more than 2,000 drones, leveraging on-site testing facilities for efficiency. This model of in-house R&D coupled with external manufacturing is becoming a hallmark of agile players in the China UAV drone supply chain.
The futuristic segment of flying cars is also gaining traction, adding a new dimension to the China UAV drone landscape. At the “Low-Altitude Economy and Future City Innovation” summit in Shenzhen, the global debut of the ALEF Model A flying car captivated audiences. Shenzhen announced plans to build over 1,000 low-altitude takeoff and landing platforms and more than 1,000 routes by the end of 2025. In Jinan, Beijiou Aviation Technology (Shandong) Group Co., Ltd. is actively developing flying cars. The company expects to complete test production of its foldable-wing, home-use electric vertical takeoff and landing (eVTOL) vehicle by July. Designed with a cruise speed of approximately 260 km/h and a range of 300 km, it can take off and land on both land and water, and fold for garage storage. “It might take less than five years for flying cars to become as commonplace as automobiles for daily travel,” predicted Li Aimin, the company’s chairman. This vision underscores the transformative potential of the China UAV drone industry in reshaping urban mobility.
Despite these advancements, the China UAV drone market remains fragmented. Training and tourism services are overcrowded, while high-end manufacturing and specialized applications like forestry and flying cars require significant capital and expertise. This disparity calls for targeted support to balance growth across segments and ensure the sustainable development of the China UAV drone ecosystem.
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Challenges in the China UAV Drone Supply Chain: Addressing the “Missing Links” in Jinan
Jinan’s China UAV drone industry, while promising, faces critical bottlenecks in its supply chain. A 2024 municipal survey of 23 key drone enterprises revealed total revenues of 12.77 billion yuan. State Grid Intelligent Technology Co., Ltd., a high-tech firm pioneering power grid drone R&D and application, contributed 8.3 billion yuan in 2024 revenue, while Shenrong Electronics added 3.1 billion yuan. The remaining 21 enterprises reported significantly smaller scales, indicating a steep gap in the industrial梯队. This concentration around a few leaders exposes vulnerabilities in Jinan’s China UAV drone landscape, such as a lack of robust mid-sized firms and overdependence on top players.
In济南高新区 (Jinan High-Tech Zone), a relatively concentrated area for drone activities, key enterprises are clustered in components (e.g., State Grid Intelligent, Rouke Intelligent, Saier UAV), low-altitude monitoring (e.g., Shenrong Electronics, Hepu Weishi), and applications (e.g., Bird Man Aviation, Buyun Aviation). However, the localisation rate for core components remains low, elevating supply chain costs and hindering industrial agglomeration. For instance, critical parts like flight control systems, navigation modules, power systems, communication units, and payloads often rely on external sources, weakening Jinan’s competitiveness in the global China UAV drone market.
State Grid Intelligent’s operations illustrate both strengths and dependencies. In its artificial intelligence joint laboratory, engineers can remotely command drones stationed 28.29 kilometers away at the Huanghe Power Supply Station in Zhangqiu District. The “Xinge Intelligent Inspection System” autonomously executes missions, with drones taking off, following predefined routes, and returning to nests even under extreme weather conditions. While this showcases advanced application capabilities, the underlying technology may involve imported components, highlighting the need for greater self-sufficiency in the China UAV drone value chain.
Revenue Distribution of Key UAV Enterprises in Jinan (2024 Data) Enterprise Revenue (Billion Yuan) Primary Focus State Grid Intelligent Technology Co., Ltd. 8.3 Power grid drones and AI applications Shenrong Electronics 3.1 Low-altitude monitoring and surveillance Other 21 Enterprises 1.37 (combined) Diverse segments including training and components The “missing links” in Jinan’s China UAV drone产业链 are not just about components but also encompass a shortage of整机 manufacturing giants and supporting firms in advanced materials, propulsion systems, and control technologies. Without addressing these gaps, Jinan risks falling behind in the race to dominate the low-altitude economy, where, as per前瞻产业研究院 (Qianzhan Industry Research Institute) projections, China’s low-altitude economy will reach 580 billion yuan in 2024, with low-altitude manufacturing accounting for 88%—the linchpin of the entire ecosystem.
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Strategic Pathways for Jinan’s China UAV Drone Industry: A Three-Pronged Approach
To overcome these challenges and propel its China UAV drone sector forward, Jinan is adopting a comprehensive strategy centered on chain strengthening, scenario-driven innovation, and ecological共建. This multi-faceted approach aims to position Jinan as a leader in the Yellow River Basin’s low-altitude economy.
First,精准招商 (precision investment attraction) is crucial to补齐短板 (add weaknesses). For start-ups, Jinan plans to engage in market-oriented participation in drone start-up financing, using capital investment to lure enterprises to the region. For整机 leaders, the city will integrate provincial, municipal, and district-level platform companies and various funds to attract top drone manufacturers to establish R&D and production bases in Jinan. In key components, efforts will focus on飞控系统 (flight control systems),导航系统 (navigation systems),动力系统 (power systems),通信系统 (communication systems),电力系统 (power systems), and载荷系统 (payload systems) through targeted招商, gradually building a full industrial chain for the China UAV drone industry. This could involve incentives for local production of critical parts, reducing reliance on imports and fostering a self-reliant supply chain.
Second,场景创新 (scenario innovation) will drive market expansion. Jinan intends to strengthen existing industrial chains by supporting key enterprises in core technology R&D, enabling them to excel in their primary businesses and become leaders in niche segments. Government-led scenario openings will use applications to spur technological and product iterations. For example, expanding drone use in fields like logistics, emergency response, agriculture, and urban management can create demand, encouraging firms to refine their offerings. This approach aligns with global trends where the China UAV drone market is evolving from experimental to practical deployments, with real-world testing accelerating innovation.
Third,生态共建 (ecological co-construction) will solidify the foundation. Infrastructure improvements are prioritized, with plans to layout low-altitude economy key projects and break through空域管理 (airspace management) bottlenecks. Technological innovation and platform建设 will be deepened by consolidating resources to provide robust support for industry advancement. Talent acquisition will be flexible, including collaborations with Shandong University to establish a “UAV College” that supplies skilled professionals for the industry. Additionally, enhanced industry promotion through events and platforms will boost Jinan’s visibility in the China UAV drone community. These measures collectively aim to create a conducive environment for sustainable growth.
Looking ahead, the China UAV drone industry holds immense potential. With a projected compound annual growth rate of 16.03% over the next five years, the low-altitude economy in China is set to redefine urban and rural landscapes. For Jinan, success hinges on integrating governmental, academic, industrial, and user resources into a synergistic innovation system. By “complementing shortcomings and forging longboards,” Jinan can transform into a highland for low-altitude economic activities, contributing significantly to the national strategy and solidifying its role in the burgeoning China UAV drone revolution.
In conclusion, Jinan’s journey in the China UAV drone industry mirrors the broader dynamics of the low-altitude economy—filled with opportunities yet fraught with challenges. The city’s proactive policies, coupled with entrepreneurial zeal, are paving the way for a resilient industrial ecosystem. As the China UAV drone market continues to mature, Jinan’s emphasis on chain completion, scenario diversification, and ecological synergy will be critical in capturing the high ground of this transformative sector. The future of urban mobility, logistics, and surveillance in China may well be shaped by the innovations emerging from Jinan’s drone enterprises, making it a key watchpoint in the global aviation landscape.