1、 Industry definition and scope
According to the regulations of the Civil Aviation Administration of China, drones are aircraft managed by control stations (including remote control or autonomous flight), also known as remotely piloted aircraft. Unmanned aerial vehicle system, also known as remote piloting aircraft system, refers to a system composed of unmanned aerial vehicles, related control stations, required command and control data links, and any other components specified in the approved model design.
Due to the fact that the use of drones usually includes not only the body itself but also all equipment involved in drone flight, as well as corresponding follow-up services, the drone industry covered in this report includes the design, manufacturing, maintenance, and operation activities of unmanned aircraft operated by radio remote control equipment and self-contained program control devices, as well as ground, ship, or host remote control station radars and other equipment.
2、 Industrial Policy Analysis
（1） Industrial environment
1. Positive policy environment brings new opportunities for the development of drones
In November 2016, the State Council issued the "13th Five Year Plan for the Development of National Strategic Emerging Industries", which clearly proposed to vigorously develop civilian helicopters, multi-purpose aircraft, special aircraft, and industrial grade drones with high market demand. In 2017, China issued multiple policy documents such as the "Special Rectification Plan for Unmanned Aerial Vehicles" and the "Notice on Further Strengthening the Management of Unmanned Aerial Vehicles" to regulate the order of the unmanned aerial vehicle market. The support of industrial policies and the soundness of regulatory policies will ensure the rapid and stable development of drones. In 2018, with the introduction of policies such as the "Interim Measures for the Management of Commercial Flight Activities of Civil Unmanned Aerial Vehicles", the operation and service aspects of unmanned aerial vehicle pilot training have been given priority development.
2. Breakthrough in core technology, product performance will continue to improve
With the continuous breakthroughs in key technologies such as wireless charging, visual obstacle avoidance, gesture control, 5G communication, and integrated chips, the performance of drones will be greatly improved, with portability, easy operation, long endurance, and autonomous response becoming the main features. The speed of 5G is 250 times faster than the current LTE network standard connection speed, and its development will improve the connection speed of drones; A high-performance chip that integrates wireless communication, sensor integration, and spatial positioning functions can enable drones to achieve the same processing power as personal computers. In addition, the trend of integrating cutting-edge technologies such as artificial intelligence and virtual reality with drones is becoming increasingly significant, and the consumer experience will gradually improve. Applying VR technology to drones allows users to change the camera angle by simply turning their head, and with the help of a remote control, the drone's captured images can be displayed in real-time in front of the user, providing a new operating experience from a virtual reality perspective.
3. The popularization of flying culture is expected to fully unleash market demand
At present, some domestic universities have established unmanned aerial vehicle research institutes and offered unmanned aerial vehicle related majors, with an increasing emphasis on unmanned aerial vehicles. Industry organizations such as the Drone Industry Alliance and the Drone System Standardization Association have been established one after another, and various regions have started to build drone aviation culture towns and drone research and development manufacturing bases. Social organizations have organized events such as aerial photography, drone design, and drone competitions. The drone industry has ushered in a new wave, and market demand is expected to be fully released.
（2） Policy analysis
1. National policies promote rapid development of drone manufacturing industry
The civilian unmanned machinery manufacturing industry is a rapidly developing emerging industry in recent years, widely used in personal consumption, crop protection, surveying, energy and other fields, and is playing an increasingly important role in the national economy and social production and life. Among them, consumer drones are one of the few high-tech products in China that can lead the global development level, and have become a new business card of Chinese manufacturing. The release of the "Guiding Opinions on Promoting and Regulating the Development of Civil Unmanned Aerial Vehicle Manufacturing Industry" will vigorously carry out technological innovation, improve product quality and performance, accelerate the cultivation of advantageous enterprises, expand service application fields, establish and improve standard systems, strengthen frequency regulation use, promote the construction of control platforms, promote product testing and certification, and promote the healthy and orderly development of China's civil unmanned aerial vehicle manufacturing industry.
2. The strategy of building a strong manufacturing country leads the drone industry to achieve significant development
Since DJI Innovation introduced the multi rotor drone flight platform and multi rotor flight control to the consumer market in 2012, the drone industry has become a rising star in the general aviation industry, not only expanding the vast civilian drone market but also becoming a new economic growth point. In 2015, the National Strategy for Building a Strong Manufacturing Country also explicitly stated that drones would be one of the development priorities. Under the guidance of the national strategy, the State Council and various ministries have issued a series of policy documents aimed at promoting the development of the drone industry and strengthening drone management. At the same time, local governments also attach great importance to the development of the drone industry, actively attracting projects related to the drone industry to land and introducing support policies for the drone industry.
3、 Panorama of the industrial chain
Drones mainly include three stages: design and testing, complete machine manufacturing, and operational services.
Upstream design testing includes two aspects: overall design and integration testing.
Midstream aircraft manufacturing includes three aspects: flight systems, ground systems, and mission payloads, which are key components of drone manufacturing
The flight system includes the power system, navigation system, flight control system, communication system, and aircraft manufacturing. It is the core system for unmanned aerial vehicles to complete the entire flight process, including takeoff, aerial flight, mission execution, and return to the field for recovery.
The ground system is responsible for the mission planning of the aircraft, such as route planning, flight modes, etc. It also has functions such as image display and processing, including auxiliary equipment, takeoff/landing systems, remote detection, monitoring systems, data processing centers, etc.
Task payload refers to various devices carried by unmanned aerial vehicles, such as cameras, visible light, thermal imaging, multispectral, hyperspectral equipment, etc., mainly including sensor systems, camera systems, etc.
The downstream operation services mainly include data collection and pilot training.
4、 Market size
It is expected that in the next three years, as the durability and cost of use of civilian drones are fundamentally resolved, the application of drones in the civilian market will become more diversified. Meanwhile, the increasing demand and continuous improvement of management measures will continue to make drones one of the most dynamic markets for the world's aerospace industry. In 2018, the scale of China's drone market reached 8.8 billion yuan, a year-on-year increase of 55.8%. It is expected that by 2021, the market size of drones will exceed 30 billion yuan.
Professional UAVs pay more attention to reliability, progressiveness of technology and load capacity, while consumer UAVs pay more attention to user experience and cost performance of products. Due to different product positioning and target audience, the market capacity of consumer grade drone products will soon reach saturation, and competition in the consumer grade drone market will become more intense in the future; Due to the diversification of application fields, the professional level drone market has a much larger market size than consumer level drones. It is expected to have significant development in the future, and the proportion of products will further increase.
5、 Trend analysis and judgment
1. The application scenarios of professional level unmanned aerial vehicles such as plant protection inspection and security have entered a period of rapid development.
2. The development of consumer grade drones has entered a mature stage, while the development of professional grade drones has entered a period of rapid growth.
3. Drone companies are mainly concentrated in the eastern and central regions, especially in the East and Central South regions, which have the highest number of drone companies.
4. The drone industry has just begun its design and testing phase; The flight control system in the whole machine manufacturing process has a broad market space; The number of training institutions and drivers in the operational service sector is growing rapidly.
