CICC: Recommend focusing on investment opportunities in the integration of low-altitude and logistics

CICC Research Report states that, in response to the demand for cost reduction, efficiency improvement, and service extension in China’s logistics market, drones are reshaping new delivery paradigms. From helping to speed up cost reduction to achieving last-mile urban delivery, drones can break through the spatial and time constraints of traditional logistics, driving efficiency and intelligent upgrades. The “14th Five-Year Plan” clearly identifies the low-altitude economy as a strategic emerging industry that is expected to receive more policy support. It is recommended to pay attention to investment opportunities that combine low-altitude and logistics.

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CICC | Low-Altitude Technology Series Logistics Chapter: A New Three-Dimensional Delivery Pattern

CICC Research

Faced with the demand for cost reduction, efficiency enhancement, and service extension in China’s logistics market, drones are redefining new delivery models. From aiding in cost reduction and speeding up processes to enabling last-mile urban delivery, drones can overcome the spatial and time limitations of traditional logistics, promoting more efficient and intelligent upgrades. The “14th Five-Year Plan” explicitly highlights the low-altitude economy as a strategic emerging industry likely to receive increased policy support. We recommend focusing on investment opportunities that integrate low-altitude and logistics.

Summary

China’s logistics market is large but faces structural bottlenecks, with drones playing a key role in breaking through. The scale of China’s logistics industry has ranked first globally for nine consecutive years[1]. In 2024, the total social logistics turnover is expected to exceed 36 trillion yuan, but structural issues remain: on the social side, logistics costs as a percentage of GDP are still at 14.1%[2], higher than in developed countries; on the enterprise side, logistics companies face declining courier prices and rising labor costs. Against this backdrop, logistics drones, with advantages in overcoming spatial constraints and reducing time costs, are crucial for breaking the deadlock. At the policy level, the national “14th Five-Year Plan” explicitly states the strategic development of the low-altitude economy; local governments are conducting pilot projects to accelerate the deployment of logistics drones.

Some low-altitude logistics scenarios have already seen unit transportation costs surpass traditional models. Technological iteration and industry chain collaboration are driving the commercialization of logistics drones. According to estimates by Zhongtong Research Institute, adopting unmanned aerial logistics models can help logistics companies reduce operating costs by over 30% and improve efficiency by over 50%. We believe drones can activate idle airport resources, fill gaps in air transportation in remote areas of central and western China, and break through traditional civil aviation barriers to enable direct air transport to small cities.

In logistics scenarios, specialized drone manufacturers, logistics giants, and cross-industry companies are positioning themselves based on resource endowments, leading to value release along the industry chain. Equipment providers earn premiums through drone technology barriers, while scenario operators leverage logistics network advantages to share benefits. Our estimates suggest that China’s hardware market for drones could reach 127.4 billion yuan, with third-party services potentially reaching an annual market size of 8.5 billion yuan.

Risks

Policy and regulatory risks, data and privacy risks, market competition and commercialization risks, and the long cycle for technical validation and airworthiness certification.

(Source: People’s Financial News)