Author | Wang Xiaojuan

In today's weather is good. Today's weather is good.

Once again, Ning Wang has invested hundreds of millions of dollars in the low-altitude economy field.

On August 3, Contemporary Amperex Technology (CATL) signed a strategic investment and cooperation agreement with Shanghai Feng Fei Aviation Technology Co., Ltd. (Feng Fei Aviation). CATL is the exclusive investor, investing hundreds of millions of dollars and becoming a strategic investor in Feng Fei Aviation.

Through this investment, CATL will work with Feng Fei Aviation for a long time and jointly focus on the research and development of eVTOL (electric vertical takeoff and landing aircraft) aviation batteries. In particular, they will improve the energy density and performance of the eVTOL battery, supporting longer flight distances and higher payloads, while also enhancing product safety and stability.

CATL has been eyeing the low-altitude economy for some time, and this investment is a key move in its bullish layout of this trillion-dollar track.

Earlier, Wu Kai, chief scientist of CATL, revealed that the company was cooperating on the development of civilian electric aircraft powered by solid-state batteries, implementing aviation-level standards and testing.

Last July, CATL and Commercial Aircraft Corporation of China, Ltd. (COMAC) and Shanghai Jiao Tong University Enterprise Development Group Co., Ltd. jointly established SHANGFEI TIMES (Shanghai) Aviation Co., Ltd. (Shangfei Times) to enter the civil aircraft field.

With unprecedented policy support for the low-altitude economy, capital is also pouring in. CATL, with ample funding, has formed a "strategic alliance" with these companies, deeply binding them in the industry chain to jointly tap into this trillion-dollar track. This is also one of the secrets of CATL's success in the power battery industry in the past.

Today, CATL still has the largest market share in both the domestic and global markets. However, passenger vehicle power battery growth has already slowed, capacity has exceeded demand, and CATL needs to be proactive in finding new growth paths.

According to reports, in the first half of this year, CATL achieved operating revenue of 166.767 billion yuan, a year-on-year decrease of 11.88%; and realized a net profit attributable to its parent company of 22.865 billion yuan, a year-on-year increase of 10.37%.

The decrease in revenue is mainly due to fierce market competition and a drop in power battery prices, forcing CATL to "trade volume for price" to maintain existing customers. In the first half of the year, CATL's battery shipments increased by 205 GWh, a year-on-year increase of 21%, but the average price of power batteries was only 0.79 yuan/Wh, a year-on-year decrease of 30%.

Thanks to its early investment and economies of scale, CATL can still maintain a good level of profitability under industry pressure.

Whether in the domestic or global markets, CATL's current market share is still first. However, the growth of power batteries for passenger vehicles has already slowed, and CATL's capacity is in excess. It needs to be proactive in finding new growth paths.

In addition to power batteries for passenger vehicles, CATL has also begun to lay out new growth directions in the past few years, including power batteries for commercial vehicles, battery mineral resources, energy storage business, aviation power batteries, etc.

By laying out these multiple businesses, CATL has often played the role of a corporate venture capital (CVC). This has also been CATL's style, previously tying itself to the battery industry's upstream and downstream by investing in lithium mines and car companies, and also enriching the industry. This move into the low-altitude field is no different.

Feng Fei Aviation, the recipient of the investment, is a leading eVTOL company. Established in 2017, the company is one of the earliest enterprises in China to invest in eVTOL. Since this year, Feng Fei Aviation has completed several test flights at home and abroad, such as the cross-city flight from Shenzhen to Zhuhai, which was the first cross-city and cross-sea flight in the world.

Although the application of power batteries in large aircraft is still far off, the low-altitude field is surging. At present, various battery manufacturers are entering the field. In addition to CATL, companies such as EVE Energy Co., Ltd. and Gotion High-Tech are also involved in the low-altitude field.

The low-altitude field is also seen as an incremental market for the power battery industry.

According to the data released by the Civil Aviation Administration of China, the scale of the low-altitude economy market will reach 1.5 trillion yuan by 2025. Industry insiders estimate that the trillion-dollar low-altitude economy will bring an increase of 50 billion yuan to 200 billion yuan to the battery industry.

Since this year, there have been more and more supportive policies on the low-altitude economy in various places.

Recently, Shenzhen also held a conference on the high-quality development of the low-altitude economy, indicating that it will build a low-altitude take-off and landing network composed of helicopter/eVTOL passenger transportation, logistics transportation, community distribution, public governance services, etc. By the end of next year, more than 1,000 low-altitude aircraft take-off and landing platforms will be built.

The flying car industry is also particularly hot. On August 5, the company Xiaopeng Huitian, focusing on flying cars, received a B1 round financing of 150 million US dollars and launched a B2 round financing at the same time.

As a key supplier in the automotive industry, Contemporary Amperex Technology was once relied upon by various automakers. Its past ability to accumulate power batteries for passenger vehicles is also expected to be transferred to the eVTOL field and become its new growth point.