The global drone package delivery market is expected to soar in the coming years.  One research firm estimates a whopping 14-fold increase in the valuation of the delivery market from $528.4 million in 2020 to $7.63 billion by 2027.  But these heady predictions can be misleading. Future progress still depends on the ability of drone firms to scale their “last mile” deliveries beyond a limited operating area – usually a small town or village.  Can these operations be truly profitable if drone firms are still making them on an ad hoc basis, typically one flight at a time, and with just a single drone?

According to a recent authoritative report by McKinsey, the answer is clearly “no.” Drone companies would need to run multiple concurrent operations with an entire fleet of drones, coordinating their delivery routes and drop-off times to reduce costs and maximize efficiencies.  None so far are doing so.

Furthermore, scalability is likely to depend on whether the Federal Aviation Administration (FAA) will loosen its regulatory grip and allow package delivery companies to conduct Beyond Visual Line of Sight (BVLOS) operations over long distances and near heavily-populated areas.  So far, the FAA has been reluctant to do so.  There are also technological barriers, namely, the drones’ dependence on battery power, which generally limits them to distances of a few miles at best.

Another key issue is safety: Some drone companies – for example, Amazon’s – have a less than perfect safety record, which has led the FAA to keep their package drones on a short tether.  Only Zipline and Wing have received the FAA’s full vote of confidence, but even their BVLOS flights remain stuck in the advanced pilot stage.

Not all drone companies – especially those operating largely outside the orbit of the US consumer market – may face these same obstacles.  A good example is Aramex, which has already received approval from the government of Dubai to expand its operations country-wide.  In February, the company field tested its unique delivery model, which pairs GPS-equipped aerial drones with robotic ground vehicles that can plot virtual maps and alternate routes and make road deliveries directly to consumer homes.

Aramex’s drones, which are designed by BARQ EV, a commercial drone delivery service provider in the UAE, come equipped with multi directional sensors that allow the drones to fly around potential air and ground obstacles, especially in dense urban areas, while avoiding collisions and crashes. Most drone companies that still rely on remote piloting lack the sense and avoid technology of Aramex drones, which make them safer to fly autonomously, one of the regulatory obstacles still facing drones in the US market.

Aramex drones will also benefit from a remote fleet management system that helps take orders, manages dispatch and plans and coordinates multiple drone flights with the operations of the robotic ground-based delivery vehicles that travel along streets, sidewalks and footpaths to their appointed destinations.  The vehicles also have a substantial payload capacity, allowing consumers to order an entire grocery basket of food items, far in excess of what US retailers like Walmart and Amazon currently deliver.

It’s not entirely clear when the new Aramex delivery system will be fully operational.  Last February’s trials, carried out at the Rochester Institute of Technology (RIT) in collaboration with Kiwibot, a delivery robots company, were deemed a major success but the results are still being reviewed.  Pending a few adjustments, a full roll-out of the new system could come as early as this fall, observers say.

Dubai has emerged in recent years as one of the world’s leading drone hubs and a center for the development of sustainable “smart” city technologies   It is also a potential launching pad for expanded drone operations throughout the Middle East North Africa (MENA) region where drone industries are still in a nascent stage of development. With its base in Dubai, and with continued generous government investment and regulatory support, Aramax could be well-positioned to expand its package delivery model to the entire MENA region and eventually to emerging “smart cities” in the US and elsewhere with a similar long-term vision.

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