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UAVs Implications in Logistics – Part I

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After taking a broad look at use cases from a range of different industries, this report now examines implications for the logistics industry. While many of the above applications are already common today, the use cases in and for logistics are still in its early stages. The use cases illustrated below must therefore be seen as visionary; the intention is to provide inspiration and trigger discussion.

These logistics use cases are not intended as a precise prediction of future developments. As previously mentioned, electrical multicopters (characterized by vertical take-off and landing) appear to be the most promising for the logistics industry. Accordingly we focus on use cases within short distances instead of considering long distance operations. DHL Trend Research divides logistics industry use cases into four categories: Urban First and Last-Mile, Rural Delivery, Surveillance of Infrastructure, and Intralogistics.

1.1 Urban First and Last Mile

Rapid urbanization is one of the megatrends of recent years and the near future, especially in emerging markets. The insurance company Swiss Re forecasts the global urban population will “grow by about 1.4 billion to 5 billion between 2011 and 2030, with 90% of the increase coming in the emerging markets”.

Negative implications of this trend include congested roads, pollution, and decreased efficiency caused by delays in the flow of people and goods. It is often difficult for city planners to keep up with the pace of urbanization and population growth. In many cases, infrastructure projects can only provide temporary relief.

Part of the problem is urban first and last mile delivery, and demand for this is likely to increase as e-commerce volumes grow. China posted an impressive compound annual growth rate of 120% between 2003 and 2011 for its e-tailing market (consumer-facing e-commerce transactions excluding financial services, job search, and travel) and, even if growth rates are likely to come down, future increases will still be substantial.

UAVs could provide major relief for inner cities, taking traffic off the roads and into the skies. So far, payloads are limited but a network of UAVs could nevertheless support first and last-mile logistics networks. For instance, aerial delivery company Flirtey plans to introduce the worlds -first commercial UAVs for delivery. Student text book rental service Zookal will use Flirtey to deliver parcels directly to a customer.

Customers will receive a smartphone notification that will enable them to track the parcel via GPS, and receive the parcel directly at an outdoor location. Once the UAV arrives at the outdoor delivery destination, it hovers and carefully lowers the parcel through a delivery mechanism that is attached to a retractable cord. This aims to significantly reduce waiting times from two to three days, to as little as two to three minutes.

An airborne first and last-mile network could look as follows: Shipments that arrive from outside the city limits are sorted at existing facilities (hubs, warehouses, crossdocking sites), and shipments meeting certain criteria are separated automatically. In addition to size, weight, and time criticalness, these criteria could also include dynamic metrics (e.g., current road conditions, air pollution, and network load). Each UAV automatically picks up assigned shipment(s) from a conveyer belt and takes off. On its way back to the hub, the UAV could carry out point-to-point deliveries that lie on its route.

Its routing decisions would always be dynamic, meaning an intelligent network would redistribute all resources in real-time, depending on the load and urgency of certain shipments. When an assignment for emergency transport comes in (e.g., time-critical delivery of blood from a blood bank), this is prioritized.
End customers are equipped with an app that allows them to see nearby UAVs and order a dynamic pick-up – this system would use GPS data from the customer’s smartphone to meet him or her wherever they are, even if they move to a different location after placing the order. There would be the same flexibility for deliveries – as soon as the customer sends a notification, a UAV leaves the hub and makes delivery direct to the customer location or in case of returns, picks it up right from the first mile of the customer.
AMP Electric vehicles even plans to test the pairing of delivery trucks with UAVs that will deliver parcels that are outside of the main delivery route of the truck. The UAV would be positioned on top of a delivery truck, waiting for a parcel from the driver. When loaded, the UAV will scan the barcode on the parcel, schedule the route to the delivery point via GPS and take off to the destination. In the meantime, the truck will continue on its rounds. After a successful delivery, the UAV will fly back to the truck for its next delivery run, where it can also recharge its battery wirelessly.
The first and last meters of the delivery process are likely to be the most technically challenging. If the customer is outdoors and moving, the UAV could meet them and ‘hand-over’ the delivery after identifying the customer via NFC or QR code on their smartphone. But if the customer is at home, things gets trickier. With a garden or balcony available, the UAV could drop the parcel onto this.
With large buildings and skyscrapers, the UAV could land on the roof. The most problematic delivery would be to mid- sized buildings with pitched roofs – structures that are prevalent in European locations – necessitating an alternative delivery point, perhaps some sort of collection point. The existing DHL Packstation or Paketkasten network could be upgraded to handle shipments of this kind.
This urban first and last-mile use case is probably the most tangible and spectacular in the logistics industry. But it is also the application with perhaps the largest barriers, because privacy and safety concerns multiply in the densely populated urban environment. And it is the most challenging in terms of regulatory framework conditions and infrastructure – especially integration into existing urban infrastructures.