(Yicai Global) Jan. 29 -- Investment in China’s commercial aerospace sector tripled last year, but the industry still has far to go to break away from a state-led agenda and cultivate its own market, insiders say.

CNY6 billion (USD928.8 million) went into the sector last year, up from CNY1.9 billion in 2019, according to corporate data platform Tianyancha, and there were more than 15,000 space-related companies in the country.

Many investors espouse the view of Zhang Hui, managing director of venture capital firm Casstar. He told Yicai Global the sector will cultivate a complete industrial chain and bring a lot of venture capital opportunities, ushering in a CNY100 billion (USD15.5 billion) market. The sector should reach a new peak in the next three to five years, he added.

There is reason for caution, though, according to a number of experts. Private firms were only permitted to enter the industry in 2014, said Jin Zhonghe, vice dean of Zhejiang University’s School of Aeronautics and Astronautics. To date, the industry has been dominated by an agenda led by the government and the military, he added.

To have commercial value, private aerospace firms need to find original uses for their products, Zhang said. They cannot compete with state-owned players in scale and price. If everyone offers the same products, there will be overcapacity.

While China’s civil space industry has had major breakthroughs in the past five years, it still needs to lower costs and increase application scenarios before it can enter mass production, Jin said.

The biggest cost these companies face is getting satellites into orbit, according to insiders. The China Academy of Space Technology calculated that its costs up to CNY30 million (USD4.6 million) to launch a small satellite from China, while it can cost just a third of that in other parts of the world.

Editor: Kim Taylor