China’s Delivery Drone Rollout: Slow but Steady

Much has been written abroad about China’s armed drone sales, but last year we heard less about the progress of its delivery drones. Delivery drones help express delivery companies address declining profits, especially profitability issues associated with last-mile shipments. China has increased the use of delivery drones to solve the problem of distant rural deliveries, as well as the high pressures of urban demand. Companies like Meituan and JD.com have been making drone deliveries to customers to meet demand.

Drones can help solve major supply chain problems, particularly last-mile delivery challenges and cargo bottlenecks. Last-mile delivery, the logistics involved in getting products to the customer’s doorstep, is the most expensive aspect of delivery and can account for more than half of transportation costs. This is because this last part of the shipping process usually involves several stops.

Last-mile delivery is particularly expensive in China’s countryside, where delivery destinations are far apart and terrain can be difficult to traverse, with mountains and other geographical features acting as barriers to order fulfillment. With a growing e-commerce market in rural areas, drones can navigate remote areas. Delivery drones fly to rural areas to overcome the lack of logistics transportation.

In urban areas, the use of drones requires a special permit due to their presence at low altitude. Even then, heavy traffic in some places had made drone deliveries more convenient than human deliveries.

JD and Meituan have developed drone delivery technologies and processes. JD started drone delivery in 2015 and since then has established a three-tier UAV logistics distribution and navigable logistics system for trunk lines, branch lines and terminals. Trunkline drones can cover 300 kilometers of area to move products from one warehouse to another through a large ton class drone. Secondary line drones can quickly transfer smaller batches between logistics sub-hubs, and terminal drones travel to remote areas to solve the last-mile delivery problem.

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Meituan started its drone delivery operations two years ago and has reached 8,000 customers in Shenzhen under a pilot program. The program includes seven neighborhoods, delivering meals at kiosks that are easily accessible to customers. Meituan applied to operate throughout Shenzhen, a city where the streets are full of cars. Meituan has also announced plans to build a pilot hub in Shanghai for its drone logistics network.

Meituan has had to overcome technical problems, such as programming drones to be fully autonomous instead of remote controls, and carrying packages of different weights. These issues were addressed through the use of robust navigation systems and equipping drones with spare powertrain capability.

Package weight is less and less of a limiting factor. To increase the weight of goods that can be transported, Chinese companies are expanding the use of cargo drones. China’s first unmanned cargo flight took place last month in the city of Jingmen, Hubei. The cargo drone can fly a load of 500 kilograms up to 500 kilometers. Such cargo drones will come out of the testing phase to be operational in the next decade.

In particular, China’s regulations are subject to the operation of drones. The first national standard for drone express delivery service came into effect in January 2021. This rule establishes the requirements for conditions, procedures and safety issues for drone express delivery. Also, drones used for commercial purposes, including delivery, must be approved and registered with the Civil Aviation Administration of China.

Although everything is working in favor of drone delivery in China, the deployment of such operations has not been as fast as some had hoped. While drones have long been a part of the last-mile delivery solution, smaller drones face shorter battery life, lower charging capacity, and can be disrupted by weather factors. Larger cargo drones can solve these problems. In addition, autonomous vehicles, including delivery robots, have accelerated their deployment in China’s urban areas, as they can carry larger numbers of packages and house larger batteries. They are also confined to the ground and therefore do not face variable high-altitude weather.

Still, China’s technology and implementation of delivery drones are ahead of the United States. Amazon recently announced its first drone delivery service in Lockeford, California, after receiving regulatory approval. The company has been dogged by security lapses and high turnover in its drone program.

China also outperforms the US in the production of civil and military drones, which has contributed to technological and political conflict between the two nations. Outside of commercial delivery service, drone development involves a number of murky issues. Data security, human rights and political alliances are issues that plague China’s dominance in the production and sale of military drones.

These issues are not prominent in drone delivery, which has helped increase logistics efficiency and customer satisfaction. As a result, commercial drone delivery in China is very promising and will continue to develop in the coming years.

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