The drone logistics and transportation market is anticipated to register a CAGR of over 20% during the forecast period.
- The increasing use of unmanned aerial vehicles (UAVs) in commercial applications for faster delivery of goods is one of the major factors driving the growth of the drone logistics and transportation market.
- Growing e-commerce market is fuelling the growth of the drone logistics and transportation market.
- Eased regulations for the usage of drones for commercial purposes can be a great boost for the drone logistics and transportation market in the coming years.
Key Market Trends
Freight Drones Anticipated to Experience the Highest Growth
The freight drones segment is expected to dominate the drone logistics and transportation market during the forecast period. In the military segment, drones are being tested for the purpose of delivering supplies. The US Army is in the process of testing its Joint Tactical Aerial Resupply Vehicle (JTARV) that is meant for providing required supplies to army personnel at wartimes. Additionally, growth in e-commerce has led to the product delivery and courier service giants, like Amazon and DHL, to introduce the idea of delivery by drones into practice.
With a lot of investments and collaboration of companies over the use of a drone for the delivery of goods and services, this segment is expected to witness the highest growth. However, the introduction of passenger drones in the coming future may slightly change the market dynamics during the latter part of the forecast period. Boeing, Airbus, and Uber Technologies are some of the companies that are currently involved in the development of passenger drones and flying cars.
Asia-Pacific is Anticipated to Experience the Highest Growth
The North American region currently dominates the market studied and is expected to continue its domination, in terms of market share, over the forecast period. The use of drones for transportation has been picking up the pace in North America, with the United States and Canada taking measures to implement this in the commercial and military sector. Additionally, ease of regulations, like new remotely piloted aircraft regulations by the Transport Canada, may help the growth of this market.
Drone Delivery Canada, one of the leading drone delivery company signed USD 2.5 million agreement with Moose Cree First Nation, to deploy its drone delivery platform to serve the communities of Moose Factory and Moosonee. The company received Compliant Special Flight Operations Certificate (SFOC) in 2017, which grants it permission for providing drone services for beyond visual line-of-sight operations, and for a specific purpose of drone delivery services. Such certifications and regulation relaxations are expected to help the growth of the market in this region.
However, the Asia-Pacific region is expected to have the highest growth in the market studied during the forecast period. This is mainly due to the investments by the Chinese and Indian companies into drone delivery technology. JD.com, a Chinese e-commerce company headquartered in Beijing has been making commercial drone deliveries in four selected regions scattered across China since June 2016. The company announced its plans to build 150 drone launch facilities in southwestern Sichuan province for UAV parcel delivery by the end of 2020. The company also plans to introduce such services in Indonesia and Japan. Similarly, Zomato has acquired TechEagle, a drone startup to create a hub-to-hub delivery network powered by hybrid multi-rotor drones.
The prominent players in the drone logistics and transportation market are Drone Delivery Canada, Uber Technologies, Zipline International, Flirtey, and Matternet.
The increase in collaborations of drone delivery companies with products and service providers is expected to help them increase their market presence and expand their services in the market studied. For instance, Boeing HorizonX Ventures invested in Matternet, a drone delivery company. Additionally, vertical integration of service providers by the acquisition of drone transportation companies can help them in controlling the distribution channel.