EHang's Steep Business Growth And Potential In Other UAV Market Segments

● EHang's revenue increased dramatically in the third quarter of 2020, which boosted its share price further.

● Unmanned aerial vehicles' (UAVs') recent growth not only relied on external factors like an increasing market dynamic in the UAV industry and urban air mobility (UAM) sector but also self-innovation in terms of government support, sightseeing and logistics.

● Three elements might be detrimental for EHang's innovation – less profit from logistics and air media, threats from competitors, and unstable regulations.

● In the ever-changing market, EHang is likely to try to find a more distinct way to promote its products and meet challenges. 

EHang, a tier-one autonomous aerial vehicle (AAV) technology firm, has been selected as a member of the European Union's AMU-LED (Air Mobility Urban-Large Experimental Demonstration) on January 21, 2021, which is one of Europe's largest demonstration projects. From 2020 to 2022, this AAV technology firm will execute a test run of its AAV – EH216 in Spain, the UK, and the Netherlands.

Founded in 2014, Ehang entered into the unmanned aerial vehicle (UAV) industry late compared with other top players. It keeps finding different ways to improve its competitiveness. Over six years of development, the AAV technology firm has covered three sectors – urban air mobility, smart city management, and air media, with locations in Guangzhou, China, Austria, and France.

Financial analysis

EHang did not get good returns in the first three years, as it was still on the way to improving its competitiveness. After 2017, there was a dramatic increase in its operating income – especially in 2019, when the number reached 102.06%. This was mainly due to the firm's attempt to develop urban air mobility (UAM), which accounts for 72.2% of Ehang's total revenue in 3Q 2019. The favorable turn was in 3Q 2020 when the UAV firm's total revenue reached CNY 70.98 million, a rise of 104.3% compared with the previous year. Moreover, its loss in operating income was gradually decreasing, and with the UAM sector's expansion, it will gain more profit in the future. 

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