Drone deliveries 'unlikely to take off'

25 November 2015

Increased regulation of airspace in the future means drone deliveries - recently heralded as the retail delivery solution of the future - are unlikely to take off, according to a new report.

The report, European Retail & Logistics Insights – From Sheds to Shelves, by Colliers International, says calls from the European Commission (EC) for tighter regulation of airspace is likely to keep the concept of delivery drones grounded.

In 2013 Amazon announced that from 2015 deliveries in selected areas would be carried out by commercial drones, but the plan has stalled.

“Realistically with rising rents and increasing complication of airspace regulation drones may become more trouble than they’re worth,” said Tim Davies, head of EMEA industrial and logistics at Colliers International.

The EC said last year that further regulation on commercial drones across the EU was required to safeguard safety, privacy and data protection.

Residents, businesses and public bodies in the flight path of commercial drones carrying recording devices have raised concerns and about noise pollution and privacy.

Governments also fear the security implications of drones in their national airspace.

Instead of drones, retailers are likely to seek to make more use of existing modes, such as London’s Uber taxis or in-store collection.

As the UK's digitally literate population will rise by 48 per cent over the next 25 years, retailers need to plan how to ensure speedy deliveries across cities, the report said. However, such plans would be complicated by traffic congestion and increasing regulation surrounding drones.

The study also said the rising cost of industrial property was likely to have a significant effect on the cost of logistics. It states that industrial property has outperformed all other types of commercial real estate, largely because of demand for space from companies such as Amazon.

“Costs for last-mile deliveries will be driven by land constraints around cities such as London, where other uses such as housing often receive greater political support,” the report added.


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