TMTPOST -- The Jinan Public Resource Trading Center on Tuesday announced the successful auction of franchise rights for the low-altitude economy in Pingyin County, Shandong Province. The winning bid reached an impressive 924 million yuan ($127 million), marking the nation’s first such auction and a significant milestone in China’s low-altitude economy development. 

The franchise rights, covering a 30-year period, were awarded to Shandong Jinyu General Aviation Co., a state-owned enterprise fully owned by the Pingyin County Finance Bureau. The company, with a registered capital of 200 million yuan, operates across various aviation sectors, including general aviation services, civil airport operations, flight training, and non-commercial aircraft operations.

Pingyin County, located within Jinan City, boasts well-developed general aviation infrastructure, including Yushan Airport and Xiaozhi Airport. The county has actively pursued the establishment of a low-altitude industrial cluster to promote high-quality development in this sector.

Under the agreement, Shandong Jinyu will oversee operations and maintenance, offering services such as pilot licensing and training to foster comprehensive growth in the low-altitude economy.

The auction reflects China’s ongoing commitment to the low-altitude economy, which has seen increasing policy support this year. Liu Kun, a researcher at the University of Jinan, described the auction as a clear signal that the sector has moved from planning to pilot implementation, accelerating its development trajectory.  

The low-altitude economy, encompassing activities such as drones, air taxis, and small-scale logistics, is projected to become a trillion-yuan industry. According to a report by CCID Research Institute, the market exceeded 500 billion yuan in 2023 and is expected to surpass 1 trillion yuan by 2026.  

New technologies like 5G-A and AI, alongside the proliferation of drones, are broadening low-altitude applications, from precision agriculture to power line inspections. Emerging concepts, such as air cars, are also poised to drive growth in tourism and emergency response sectors.

Experts believe the low-altitude economy is set to become a key engine of China’s economic growth, supported by favorable policies and technological advancements.

(US$1 yuan equals 7.1894 yuan)