Will China’s drone crackdown stall the low-altitude economy?

“I thought it was a scam call, then I realised it was the police station asking about my drone.”

Liu Xiang, a drone enthusiast from Chongqing, told Lianhe Zaobao (LHZB) that while on a business trip to Cangxi county in March, he received a call from an unfamiliar number. After several rounds of questioning, he realised it was the Chongqing Police asking whether he owned a drone and requesting that he report to the station in person to leave an official record.

Liu had acquired a DJI Mini 4 Pro in 2024, and the last time he flew it was in Xinjiang in August 2025.

Many Chinese netizens have recently taken to social media to share experiences similar to that of Liu Xiang. On RedNote, the most highly engaged posts under tags such as “real-name registration”, “drone”, and “DJI drones” largely centre on police phone calls requesting that owners register their drones.

China is one of the world’s largest drone markets. After industry leader DJI made major technological breakthroughs in 2012, drones quickly became entertainment gadgets for the masses, driving explosive growth in the consumer market.

According to a report released in November 2025 by China Business Industry Research Institute, the size of China’s consumer drone market grew from 33.5 billion RMB (US$4.9 billion) in 2020 to 45.8 billion RMB in 2024, a compound annual growth rate of 8.15%. In 2025, the market size hit 50.2 billion RMB.

With the rapid market expansion, the problem of “black flights” worsened. “Black flights” refer to drone operations carried out without approval, qualifications or real-name registration, in restricted airspace, sensitive areas or at prohibited altitudes.

Chengdu Shuangliu Airport encountered nine “black flight” incidents in April 2017, forcing more than 100 flights to divert, turn back or be delayed.

In August 2025, two drones collided and crashed at a height of 400 metres in one of Shanghai’s landmark towers, the Shanghai World Financial Center, at Lujiazui. Within the tower’s setback boundary, about 66 drone crashes have occurred over the past three years.

Liu believes the call asking him to register his drone was linked to strengthened efforts to prevent “black flights”.

From 1 January 2026, China classifies “black flights” as a public security offence, upgrading penalties from administrative fines to criminal sanctions — including up to 15 days’ detention.

China has tightened drone oversight at source. Alongside existing real-name registration on the national unmanned aerial vehicle management platform, new rules that took effect on 1 May require full owner identity and product ID registration before flight, as well as prior approval for operations in controlled airspace.

Many netizens have complained that the approval process is cumbersome and slow. With the implementation of the new rules, some drone enthusiasts worry that flying drones will become increasingly difficult.

However, Liu is not concerned. “The new rules simply spell things out clearly and devolve approval powers to individual cities. In fact, approvals may end up being faster.”

But the second-hand drone market had clearly turned pessimistic. Many streamers who buy back used DJI drones say the new rules have hit prices hard, especially for older models that lack built-in ID codes.

Even for newer models with ID codes, their resale values have plunged. On second-hand goods marketplace Xianyu, one seller is offering a DJI Flip released just last year for 2,000 RMB. The receipt posted showed he bought it on 7 March in Shenyang for 3,388 RMB.

According to a report by Chinese business magazine Caijing, some DJI dealers saw drone sales fall by nearly 50% in the past two months.

At the time of writing, DJI had not responded to LHZB’s queries about sales. When I posed as a customer and asked a salesperson at a DJI store in Chongqing what measures they were taking in response to the new rules, the reply was: “We haven’t received any information on that yet.”

Li Gang, chief researcher on low-altitude economy at the Yangtze River Delta Advanced Industries Promotion Centre in Shanghai, said that in the past, many drone flights operated in grey areas with a lack of legal provisions for punishment. Li added that the updated rules were more a normalisation than a tightening of rules.

Chinese economist Pan Helin said when interviewed that in China’s current economic development priorities, safety ranked above growth, hence relevant regulations were introduced.

Industry insiders revealed that drone security also touches on national security — China is paying even closer attention to the security risks drones pose, especially after witnessing the role they played in the Russia-Ukraine war and the US-Iran conflict. 

With the new national rules taking effect, the Chinese capital of Beijing has taken it a step further. On 27 March, the city introduced its strictest drone regulations, citing “low-altitude security challenges in the capital” as a reason, effectively making it the first city to ban individuals from buying, transporting or flying drones and prohibiting people from bringing drones into Beijing.

Pan commented, “Beijing is unique. There’s not just the risk of things falling from the sky, but also the risk of aerial imagery leaking secrets. A no-fly rule there is understandable, but other cities won’t be so radical, especially those trying to develop a low‑altitude economy.”

Li also felt that because Beijing has special security protection needs, it must preemptively impose strict controls until the legal framework is fully in place. Once standards are implemented nationwide, the capital could then relax its rules.

On the impact of the new rules on the drone industry, Pan opined that tougher regulations would dampen hobbyists’ enthusiasm and curb sales of aerial photography drones. Firms like DJI would need to rely more on multiple use cases and exports to survive, while small and medium-sized manufacturers would find it harder to stay afloat.

Li added that stricter oversight would shrink the consumer drone market. Market leaders like DJI, ordinary consumers, and small operators engaged in aerial photography and similar work would all be affected.

However, Li also pointed out that the sector is currently in a period of turbulence and adjustment, and that in the long run the changes would benefit industrial users and the low-altitude economy as a whole.

“The low-altitude economy will definitely be a key growth point. What we’re seeing now is the groundwork being laid for that eventual take-off,” Li said.

After the term “low-altitude economy” first appeared in a national plan in February 2021, it was written into China’s government work reports in 2024 and 2025. The 15th Five-Year Plan (2026-2030) outline, released in March this year explicitly called for promoting the safe and healthy development of the low-altitude economy.

Data from the Civil Aviation Administration of China projected that the low-altitude economy reached a market size of 1.5 trillion RMB in 2025, and could exceed 3.5 trillion RMB by 2035.

Li said that one of the core aims of the low-altitude economy is to integrate the three “military, local and civil” (军地民) spheres, i.e. the armed forces, local governments and civil aviation or private enterprises. Previously, many local authorities paid little attention to this area and pushed the responsibility to others. Under the new legal framework, local governments must now actively engage in the low-altitude economy sector to meet flight application demands.

As the main driver of the low-altitude economy, China’s civil drone market is split between industrial-grade and consumer-grade products, accounting for 68% and 32% of the market respectively in 2024.

Ye Yonglu, founder of Tongzhuo (Chongqing) Intelligent Research Institute, which mainly uses drones for cleaning building facades, spray-painting and rust removal, said when interviewed that he is optimistic about the boost the new rules would give to commercial drone applications. He plans to increase capacity more than tenfold this year, expanding his flight operations teams from five in 2025 to 50.

Ye said the low-altitude economy needs support from relevant national policies, and believes that the new regulations are paving the way for an “integrated flight network system”.

The “integrated flight network system” generally refers to a comprehensive urban low-altitude management system spearheaded by the government, integrating fragmented regulatory powers and diverse use-cases into a single framework. Provinces and cities such as Guangdong, Hubei, Tianjin, Chongqing and Jiangsu launched low-altitude flight service platforms last year.

Li said that after a period of adjustment, the low-altitude economy is bound to grow on a large scale — that growth would be gradual and not happen overnight.

Pan felt that while the low‑altitude economy would continue to develop, multiscenario applications cannot fully replace demand for aerial photography and similar uses, so overall growth could still slow down.

This article was first published in Lianhe Zaobao as “无人机监管收紧冲击消费市场 低空经济待整合起飞”.

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