By year’s end, Amazon plans to usher in a new era of its aerial delivery service, aiming to reach millions more with small, lightweight packages sent via drones. This ambitious expansion targets suburban areas across nearly 500 cities in the United States, the company revealed in a Thursday announcement.
Incredibly, these drone deliveries could reach customers in as little as 30 minutes, according to Amazon’s latest statement. The drones are engineered to carry payloads of up to five pounds, ensuring swiftness and efficiency in delivery.
This strategic expansion amplifies the competition between Amazon and Walmart, as they both vie for the crown of the quickest delivery services. Both retail giants are cleverly balancing the use of drones and traditional delivery drivers to meet customer expectations for rapid service.
Amazon’s vision includes scaling its drone delivery services more than sixfold, reaching hundreds of fresh markets nationwide. This growth will see their drones buzzing over various suburbs, extending their reach to metropolitan areas such as Chicago, Atlanta, Cleveland, and Boise. These drones are set to operate primarily in suburban locales, avoiding the complications of skyscrapers and busy airspace near major airports.
Despite the rapid advancements in drone technology, drone delivery still constitutes a modest aspect of the broader logistics landscape.
Hundreds of thousands of packages have already been delivered by Amazon drones this year, but even after this expansion drones will still only handle a fraction of the hundreds of millions of package deliveries each year. In addition to only being able to carry 5 pounds, the drones Amazon builds face countless challenges from tree cover to landscaping and inflatable pools that can make it hard to find a good drop zone.
There are also regulatory hurdles to overcome in every community where Amazon wants to set up operations. Noise concerns also pose a potential challenge.
“It’s still an experiment. It’s still in test and learn mode,” said Sucharita Kodali, who is a retail analyst with Forrester.
The novelty of drone delivery may attract orders at first
Initially, consumers might order something delivered by drone because they are curious about it, but it’s not clear how often they will continue to use the service, and Amazon is still working out the economics, Kodali said.
The service will be free for Amazon Prime members who are ordering more than $50 worth of goods, but smaller orders will cost members $2.99. Non-members will pay $4.99 for drone delivery.
Prime members get free deliveries while non-members pay a flat fee if the shipment is under $35 for standard delivery or up to $12.99 for same‑day shipments when available.
Kodali said drones could prove more useful for certain light-weight deliveries that are needed urgently like prescription medications.
DoorDash and other delivery companies also are experimenting with using drones to deliver foods and other goods.
Amazon CEO believes drone delivery will be part of the mix
Amazon’s CEO Andy Jassy told shareholders in his annual letter in April that the company has learned a great deal by flying drones in 11 sites across Arizona, Florida, Kansas, Louisiana, Michigan, Nebraska, and Texas. In each location, the drones launch from an Amazon warehouse and cover about 175 square miles, so it takes multiple drone launching locations to serve a large metro area.
“Prime Air now has a design that’ll scale, plans to serve communities with 30 million customers by year-end, and expects to deliver half a billion packages by the end of this decade (with an aim to deliver inside 30 minutes),” Jassy wrote.
Amazon is also continuing to invest in its warehouses, smaller fulfillment centers closer to customers and its fleet of trucks as the company competes to deliver packages within minutes or hours instead of just days.
Amazon is already certified by the Federal Aviation Administration and the company has been awarded waivers to fly drones beyond the line of sight of the pilots. Amazon has invested in safety measures to help drones avoid collisions with anything else in the sky while they are making deliveries.
The federal government has proposed a rule that would allow more drone operators to fly beyond the horizon, but that hasn’t been finalized yet.
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