Delivery Drones Are Gearing Up for Prime Time

Historic trials of drone deliveries are happening around the world. Most recently, Transport Canada successfully completed a long-distance, beyond visual line-of-sight drone delivery in late August 2019. Working with InDro Robotics, Canada Post, and London Drugs, prescription medications were transported from a London Drugs store in Duncan, British Columbia to a resident and a local grocery store on Salt Spring Island (about 6 km [3.7 miles] away).

Momentum Is Gaining

The trial in British Columbia is just one of many recent events that suggest drone delivery is likely coming sooner than people expect. Consider the following timeline of events in the delivery drone market:

• In April 2019, Alphabet’s drone company, Wing Aviation, received Federal Aviation Administration (FAA) approval for drone delivery. This was the first time a US company has been cleared to deliver commercial goods by drones.
  

• In May 2019, DHL launched an autonomous drone delivery service in Guangzhou, China. The drone’s route is 5 miles long and takes 8 minutes to travel one-way (previously a 40-minute trip by car or truck).
  

• In June 2019, Amazon unveiled its latest version of the Prime Air drone and announced that it will begin drone deliveries within several months—locations and timelines were not provided. The company’s drone can fly for 15 miles on a single charge and carry parcels of up to 5 pounds (Amazon has stated that 86% of its packages weigh under 5 pounds).
  

• In June 2019, Amazon became the second company to get FAA approval for drone delivery. The company received a 1-year certificate (eligible for renewal) from the FAA to operate its MK27 unmanned aircraft with the express intention of establishing package delivery operations in the US.
  

• In July 2019, UPS launched a drone delivery subsidiary called UPS Flight Forward. The company filed for Part 135 Certification with the FAA—if granted, the certification would enable the delivery giant to deploy FAA-approved flights beyond line-of-sight, at night, and over populated areas. 
  

• In August 2019, the first FAA-approved beyond line-of-sight drone was tested by the University of Alaska Fairbanks.
  

Regulatory Development and Consumer Acceptance Key to Deployment

While the plethora of delivery drone testing is promising for the industry, regulations will need to catch up to the technology to allow widespread use. For example, the US FAA currently restricts drones from being operated out of the line-of-sight of the drone operator (aside from when companies are granted temporary certificates or permits). However, other jurisdictions are moving more quickly on drone regulations. For example, the European Union is in the process of regulating commercial drone flying corridors of airspace called U-Space. 

Delivery drone manufacturers should also focus on addressing potential consumer resistance by making the devices less noisy (significant numbers of residents have complained about the noise associated with pilot delivery drone programs) and include advanced safety features such as rotor redundancy and backup parachutes.

Drivers for Deployment Are Too Strong to Ignore

Sales of delivery drones are expected to ramp up rapidly once the regulatory barriers around line-of-sight are removed and consumer concerns about noise are addressed. The drivers for deployment are too strong to ignore. Delivery drones have the potential to drastically reduce labor costs and greenhouse gas emissions while also delivering high priority goods such as food and medicine faster than ever before. Guidehouse Insights projects annual deployment of delivery drones to grow from about 350 units in 2019 to more than 200,000 by 2030, at a compound annual growth rate of 79.2%. For more information on delivery drones, see Guidehouse Insights’ report, Transport and Logistics Innovations Overview.