DELIVERY DRONES MARKET ANALYSIS

Delivery drone is an unmanned aerial vehicle (UAV) used to transport medical supplies, food, packages, and other goods. These flying bots are autonomous or remotely controlled through a ground controlled station. Moreover, delivery drones find application in various industries such e-commerce, healthcare, and many more.

Increasing need for quick transportation and delivery of drugs and medical supplies at the time of emergencies are the key factors driving the growth of the global delivery drones market. For instance, in February 2021, Zipline, a product delivery company signed a service level agreement with the Kaduna State Government to use drones in the health supply chain system. The delivery will include daily medical supplies, such as blood pints and medicines, and planned delivery of COVID-19 vaccines across the state.

Increasing government support for adoption of delivery drones to deliver medical and other goods in remote areas by road transport is expected to drive the global delivery drones market growth. For instance, in June 2021, Flipkart, an Indian e-commerce company entered into partnership with Telangana government. The intent of this partnership to deliver medical supplies via drones in the remote areas under the 'Medicines from the Sky' project.

However, low battery life of delivery drones is one the major challenge for the global delivery drones market growth.

The global delivery drones market accounted for US$ 497.5 Mn in terms of value in 2021, and is expected to grow at a CAGR of 41.3% for the period 2021-2028.

Global Delivery Drones Market - Impact of Coronavirus (Covid-19) Pandemic

The outbreak of COVID-19 is expected to positively influence the global delivery drones market growth. There has been an increased deployment of drones for the delivery of a medical supplies, food, packages, due to increased emphasis on contactless deliveries to urban and remote areas. For instance, in April 2020, Matternet’s M2 drone system delivered medical prescriptions from a CVS pharmacy to villages in Florida to help senior citizens.

Statistics:

North America held dominant position in the global delivery drones market in 2020, accounting for 32% share in terms of value, followed by Asia Pacific and Europe.

Figure 1: Global Delivery Drones Market Share (%), By Region, 2020

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Among regions, North America held dominant position in the global delivery drones market in 2020, and is estimated to retain its dominance throughout the forecast period. Key players such as Amazon, UPS, Google, and DHL are offering drone delivery in inaccessible areas in the North America region, which has led to an increase in demand for delivery drones. Moreover, the U.S. government is also encouraging the involvement of drones for end-to-end delivery of products. For instance, in April 2019, Wing, the Alphabet-owned start-up engaged in the drone delivery, was been approved by Federal Aviation Administration (FAA) for delivery drones in the U.S.

Furthermore, in August 2020, Amazon received approval from the U.S. Federal Aviation Administration (FAA) to operate its Prime Air drone delivery fleet. This approval has allowed the company to expand its unmanned package delivery and given broad privileges for Amazon to safely and efficiently deliver packages to customers.

Major players operating in the global delivery drones market include Airbus SE, Deutsche Post DHL Group, Drones America, EHang, JD.com, Matternet Inc., SKYCART INC., SZ DJI Technology Co. Ltd., The Boeing Company, and Wing Aviation LLC.

Among component segment, propulsion system held the highest market share in the year 2020, and is expected to retain its market share over the forecast period, owing to increasing fuel prices and rising demand for energy are major concerns for online retailers. The use of hybrid-electric propulsion systems can significantly reduce fuel consumption in delivery drones, which is expected to propel the segment growth.

Figure 2: Global Delivery Drones Market Value (US$ Mn), 2017 - 2028

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The global delivery drones market was valued at US$ 497.5 million in 2021 and is expected to reach 5,586.5 million by 2028, exhibiting a CAGR of 41.3% between 2021 and 2028.

Competitive Section

Major companies operating in the global delivery drones market include Airbus SE, Deutsche Post DHL Group, Drones America, EHang, JD.com, Matternet Inc., SKYCART INC., SZ DJI Technology Co. Ltd., The Boeing Company, and Wing Aviation LLC.

Key Developments

1. Key companies are involved in partnerships in order to gain a competitive edge in the market. For instance, in August 2021, Drone Delivery Canada entered into partnership with Nexeya Canada, a Hensoldt Company for military applications. Moreover, in May 2021, the U.S. retailer Kroger entered into partnership with Drone Express, a division of TELEGRID Technologies Inc. The main objective of the partnership is to deliver grocery packages via drone.
2. Market players are focusing on strategic investments in order to enhance its presence. For instance, in March 2021, Flytrex, an Israeli drone delivery start-up has raised US$ 8 million funding to expand in the U.S.