Drone Delivery Pilot Projects Show Strong Potential

One of the most attractive applications for drones is to transport packages, especially high-priority shipments, such as medication, first aid kits, and other urgently needed goods. Although there is not yet a well-established drone delivery service, it will not be long before everyday consumers can watch drones flying overhead carrying packages to doors in their neighborhoods. Recently, several drone delivery pilot projects have been conducted around the world, further underscoring how significant the drone delivery business could be in the not-too-distant future.

In December 2013, DHL tested the “microdrones md4-1000” vehicle to deliver medicine. That was the first generation of the “Parcelcopter.” For the second generation, a location was selected for a 2014 trial, the North Sea island of Juist, which was to be supplied with time-sensitive goods and urgent medicines. This year, DHL has successfully concluded a 3-month test of its third-generation Parcelcopter, known as the Parcelcopter 3.0. The trial, which was part of a larger research and innovation project, was conducted between January and March 2016 in the Bavarian community of Reit im Winkl. During the 3-month trial period, a total of 130 autonomous loading and unloading cycles were ultimately performed while dealing with heavier loads, longer distances, and delivery to an alpine region notable for its geographical and meteorological challenges. In the coming months, DHL will analyze performance data and other insights from the trial together with its R&D partner, the Rheinisch-Westfälischen Technischen Hochschule Aachen (RWTH).

In March 2016, Flirtey, an Australian startup now based in Nevada, conducted the first fully autonomous, Federal Aviation Administration (FAA)-approved urban drone delivery in the United States. The company successfully delivered a package by drone to an uninhabited residential setting in Hawthorne, Nevada that included bottled water, emergency food, and a first aid kit. Its six-rotor drone flew itself along a predetermined delivery route and lowered the package by rope at a precise drop-off location. In July 2015, Flirtey had conducted the first FAA-approved drone delivery in a rural area by dropping off emergency supplies to a health clinic in Virginia in partnership with Virginia Tech, the MidAtlantic Aviation Partnership, and NASA. In June of this year, Flirtey demonstrated the first ship-to-shore drone delivery in the United States by delivering medical supplies from a vessel to an onshore medical camp in New Jersey. And in July, Flirtey completed the first FAA-approved drone delivery to a home in partnership with 7-Eleven, autonomously delivering food items. Flirtey plans to be a prominent player in the United States; therefore, it is participating in limited tests sanctioned by the FAA at specified sites.

Since last year, online retailers Alibaba and JD.com have been testing their drone delivery services in different parts of China. Alibaba partnered with Shanghai YTO Express to deliver ginger tea packets to 450 Chinese customers who volunteered for the one-time drone tests. JD.com recently completed the first drone delivery to consumers in the rural province of Jiangsu around Suqian City, the hometown of JD.com’s founder Liu Qiangdong. In March 2015, Shenzhen-based S.F. Express, one of the leading couriers in China, also started providing delivery services with Xaircraft drones in southern and eastern China. These included areas like Huizhou, Zhongshan, Hangzhou, and Jiaxing where the demand for same-day couriers is very high. S.F. Express hopes to expand the service to remote villages, farms, and mountain ranges.

In April 2016, a joint project was launched in Japan that involved the central government, Chiba City, research institutions, and companies including Rakuten for purposes of trialing drone-based home deliveries in an urban area. The drones were loaded with packages flying between condominiums, commercial facilities, and adjacent parks. A similar test project was carried out in Naka, Tokushima in February 2016 to facilitate shopping for people who live in a remote area.

Globally, big companies like Amazon and Google (Alphabet) have been exploring the use of drones to deliver customer orders for some years through their projects known as Prime Air and Project Wing, respectively, while carrying out prototype tests privately in countries where drone regulations are flexible. The current regulations in the United States do not allow the type of automated, long-distance flying that these companies have proposed for their package delivery systems. It is understood that more tests will be carried in the United States at FAA-sanctioned drone test sites to lay the groundwork for future approvals.

In addition, there have been several reports recently of delivery drone tests being conducted by Switzerland’s Swiss Post (in collaboration with Swiss WorldCargo and Matternet), French mail services company La Poste, Finnish postal service Posti, Australia Post, South Korean CJ Express, and U.K.-based FPS Distribution.

The last-mile drone delivery service is certainly a great idea and with the surge in conducting drone delivery tests, the future of package delivery looks promising. However, drone-based delivery services have many critical underlying issues related to technology, security, regulations, and outdoor conditions, among others. Even if all of these issues are addressed, the bigger challenge exists of remaining profitable while competing with the delivery truck’s milk run when the cost per delivery matters the most. So, in the initial days, this may limit drone delivery to a premium service for customers for whom time and place are sensitive issues.


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