China remains far and away the world’s leading drone design and technology provider. A single company, DJI,  currently occupies 75% of the total market in production and sales; no other company is even close.  But when it comes to passenger drones, or air taxis, China’s dominance is far less complete.

Nine-year old EHang – based in southeastern China’s Guangzhou province – faces stiff competition from a dozen American and European firms, and from a local Chinese upstart, Autoflight.  As the field continues to expand, each firm is jockeying for support in an increasingly tight investment market.  In the race to full-scale commercialization, EHang still has the edge, but its rivals are gaining.

EHang has one huge advantage: it got into the air taxi business earlier (in most cases), which means it’s further along in the grueling regulatory process.  In fact, the prototypes of its chief US and European rivals are still in the early stages of FAA certification.  And most are just beginning to test their vehicles outside of controlled laboratory and airfield settings.

Archer and Joby, for example, just received their special airworthiness certificates a little more than a month ago.  So did ASKA and ALEF.  The next stage of “type” certification, declaring their prototypes fully operational and sound from a safety perspective, could take another year or more.

By contrast, EHang achieved its first airworthiness certificates from China’s CAAA  nearly four years ago.  And the company’s been conducting prototype field tests – well over a thousand worldwide  – ever since.  EHang now claims to be “90% through” the entire Chinese certification process.  While other companies boast of their plans for full-scale commercialization by 2026, or even 2025, EHang isn’t just boasting.

At its current pace of development, EHang could have hundreds of its air taxis in active service by as early as next year.

In fact, real world trials with EHang’s flagship EH-216 drone have already been conducted on a trial basis – most recently in Japan, one of China’s up-and-coming national competitors.  Earlier this year, the Japanese government allowed EHang to fly the EH-216 between two coastal ports – not only with passengers aboard, but without remote piloting.  It was the first fully autonomous flight with passengers in the history of the air taxi sector.  Japanese officials were thrilled at the success of the flight test and have announced their own ambitious plans to see EHang’s EH-216s by next year – initially for sightseeing tours.

Civil aviation authorities in other countries, including Canada and Switzerland, have also allowed for EH-216 trials, but without passengers abroad.  And, so, in fact, has the FAA.  In a little noticed development back in 2020, Roy Cooper, the governor of North Carolina, one of the nation’s most drone-friendly states, invited EHang to test fly its flagship prototype at the North Carolina’s Annual Transportation Summit.  Cooper declared the test fight a huge success. “We want North Carolina to be on the cutting edge of [passenger drones],” Cooper declared after posing for photographs while sitting in the EH-216 cockpit. “We’re proud to have EHang here to show and demonstrate to us what can be done with this technology.”

EHang’s EH-216 is also a stand-out from a design and end-user perspective.  Other companies are building larger fixed-wing or rotary aircraft for niche applications.  Archer and Joby, for example, see their air taxis serving as passenger shuttles for the major airlines or as troop and cargo transports for the Pentagon.  But the EH-216 is a compact lightweight two-seater designed for personal not commercial use; it’s intended to replace gas-powered road vehicles on highways and roads, reducing traffic congestion and pollution and making daily commutes for the individual consumer faster and more sustainable.

Currently, EHang is focusing most of its future commercialization plans on the city of Shenzhen in China’s Guangdong province.  The company’s ambitious plans are being closely watched by the CAAA, which is also working with officials in Shenzhen’s high-tech Bao’an District to test a new system for managing the integration of manned and unnamed air traffic, with EHang’s EH-216 drones at its center. The demonstration project encompasses not just Shenzhen, with its 17 million residents, but two neighboring Chinese provinces as well as Hong Kong and Macao, making it one of the largest air traffic management integration experiments in the world.

Dubbed “Wings of the Bay Area,” the project intends to create 10 permanent routes for EHang passenger drones by the end of 2023, with plans to establish dozens more by the end of 2024, once EHang completes the CAAA certification process and can begin mass production at its plant in nearby Guangzhou, the company’s home base.

It’s an ambitious timetable  – perhaps, far too ambitious.  Consider this: EHang plans to charge consumers almost $300,000 to purchase its first EH-216s – a sales price only China’s most affluent citizens could afford.  Given the country’s enormous population size, that’s still millions of consumers – and perhaps hundreds of thousands in Shenzhen alone.  But the idea that the EH-216 could become a widely-used personal air vehicle (or PAV) at this price, is still fanciful, or at least premature, critics say.

What would the company need?  Scaled-up manufacturing facilities to reduce its average production costs, generous tax incentives and subsidies, an even more permissive regulatory environment than the one it currently has, and a comprehensive plan for vertiports and other infrastructure so that its flying car might become cheaper and more accessible to everyday consumers.  It could happen, critics say, just not right away.

A more likely short-to-medium term scenario, observers say, is for passenger drones to be introduced in Shenzhen and elsewhere, either as ride-share taxis or as cargo transports, or both.  In fact, Shenzhen officials seem to be hedging their bet by encouraging two of EHang’s Chinese competitors, Autoflight and Lilium (which is hoping to expand beyond Europe into Asia) to establish their own R&D and production facilities in the city.  The vehicle prototypes of both companies have space for a higher number of passengers – 4 in the case of Autoflight, 6 in the case of Lilium. making them more easily convertible to commercial use.

Whether either company can challenge EHang’s dominance in Shenzhen or elsewhere remains to be seen.  EHang, sensing unexpected competition, is already seeking and acquiring new strategic investment – including $23 million from a South Korean media mogul received just last month – as well as diversifying its core prototype.  The company’s designers are spinning off several new variations of the EH-216 – one for urban firefighting (especially for apartment and office complexes), another for aerial surveying, and still another for emergency medical supply deliveries (especially for transplanted organs).  Pilot testing of each is already underway, and new CAAA certifications will surely follow.  All signs that China’s air taxi technology leader intends to stay on top.

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