Market Overview

UPS Seeks To Accelerate Growth Of Drone-Delivery

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UPS Seeks To Accelerate Growth Of Drone-Delivery

United Parcel Service (NYSE: UPS) has announced a collaboration with Wingcopter, a German-based electric vertical take-off and landing (VTOL) aircraft startup, to scale up its drone delivery operations in the U.S. and across the world. Wingcopter will be working with UPS Flight Forward (UPSFF), the drone delivery subsidiary of UPS, to create this next generation of package delivery drones. 

"Drone delivery is not a one-size-fits-all operation. Our collaboration with Wingcopter helps pave the way for us to start drone delivery service in new use-cases. UPS Flight Forward is building a network of technology partners to broaden our unique capability to serve customers and extend our leadership in drone delivery," said Bala Ganesh, vice president of the UPS Advanced Technology Group. 

The drone delivery segment has gained momentum in recent years, thanks to the ever-growing importance of expedited delivery, especially within the ecommerce market. With delivery speed being considered an important marker of end consumers' satisfaction, logistics companies see the relevance in investing across two distinct unmanned VTOL drone segments – long-range heavy-haul and short-range light-haul aircraft. 

While heavy-haul drones are typically used to deliver across remote and impoverished regions, light-haul drones are helpful across the last-mile delivery segment, particularly for hastening delivery in urban spaces with frequent traffic deadlock. 

For UPS, the partnership with Wingcopter will be within the heavy-haul VTOL aircraft segment, following Wingcopter's track record in "delivering a variety of goods over long distances in multiple international settings."

The Wingcopter collaboration is UPSFF's first venture with a drone manufacturer. In a statement, UPS has stated that the companies will jointly work to gain regulatory certification for commercial flight of unmanned drones in the U.S., as well as building a diverse fleet of drones with varying capabilities to meet different customer needs. 

"We are proud to partner with UPS, a global giant in delivery and logistics. Together we aspire to extend the speed and reach of package delivery," said Tom Plümmer, Wingcopter chief executive officer and co-founder. "Our vision has always been to leverage technology to improve the lives of people around the world, and the strategic relationship with UPS will further accelerate our growth and global expansion, strengthening our role as an industry leader in drone technology."

Wingcopter comes into this partnership fresh from the successful completion of its first drone delivery trial this February with healthcare giant Merck, delivering a shipment from a Merck & Co., Inc. (NYSE: MRK) lab in Gernsheim, Germany, to the Merck headquarters in Darmstadt, Germany. The test was a beyond the visual line of sight (BVLOS) project, which meant that the drone flew over inhabited regions that included buildings, electric power lines, traffic and people. 

The drone startup has considerable experience in delivering shipments for BVLOS projects across several domains, including commercial factory-to-factory deliveries, humanitarian programs and medical emergencies. 

Wingcopter's VTOL aircraft is unique in the market, as its patented tilt-rotor mechanism enables a seamless transition between two drone modes – multicopter for hovering and fixed-wing for low-noise forward flight. These modes help the drone to stabilize itself even when faced with harsh weather conditions, including wind speeds of up to 45 mph. The aircraft can reach speeds up to 150 mph with a range of approximately 75 miles. 

 

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