Home » Machine Economy » Is package delivery using drones feasible?

Is package delivery using drones feasible?

Amazon Prime Air Drone

Co-founder of Kiva Systems Robotics indicates drone delivery could be as low as 20 cents per package.*

*Updated Friday 5th December after email correspondence with Professor D’Andrea

In the early summer I wrote about the economics of Amazon’s drones, the post highlighted the cost of logistics to Amazon and some back of the envelope calculations about the likely costs of drone delivery. In the article I indicated that Amazon would require pilot’s for their drones, especially in the early years of operation, it seems far fetched that we will have fully autonomous delivery drones in our cities without some sort of human oversight, at least in the next ten years or so. Backing up my calculations a recent job advert by Amazon indicates that they are looking for drone pilots, whilst similar jobs attract annual salaries of approximately $100,000 per year.

Earlier this year Helen Greiner CEO of CyPhy Works outlined her vision of delivery drones in 5 years. Meanwhile DHL have started testing the use of delivery drones to transport medicine to a small the North Sea island of Juist.

So is it economically feasible to deliver packages by drones?

Professor of robotics and autonomous vehicles Raffaelo D’Andrea of ETH Zurich, who is responsible for the Flying Machine Arena (“a space where flying robots live and learn”), and co-founder of Kiva Systems (robotics company acquired by Amazon, Inc. for US$ 775 million in cash), thinks it is economically feasible to deliver small packages by drone.

In a guest editorial for IEEE Automation Science and Engineering (Pdf), Professor D’Andrea detailed some calculations he had previously used to assess the costs of drone delivery for Matternet whose ‘vision was to create a transportation network based on flying machines, and to initially address niche markets such as medicine delivery in underdeveloped and hard to reach areas,’ and also compared to those that they had previously used for Kiva systems “business plan for the total cost of delivery.”

To assess the costs Raff initially uses two assumptions:

  • Payload of up to 2 kg.
  • Range of 10 km with headwinds of up to 30 km/h.

In his calculations, to arrive at the likely costs of drone delivery, D’Andrea analyzes the power consumption in kW, payload mass of 2 kg; a vehicle mass of 4 kg (battery weight of 2kg); the lift-to-drag ratio; 
power transfer efficiency for motor and propeller; power consumption of electronics, in kW, electricity costs and cruising velocity, in km/h, air speed and headwinds.

After analyzing the weight of the drone, payload (parcel) drag, headwinds, etc. Professor D’Andrea states:

“So, is package delivery using flying machines feasible? From a cost perspective, the numbers do not look unreasonable: the operating costs directly associated with the vehicle are on the order of 10 cents for a 2 kg payload and a 10 km range. I compare this to the 60 cents per item that we used over a decade ago in our Kiva business plan for the total cost of delivery, and it does not seem outlandish.”

Updated — Via email correspondence, D’Andrea points out that the ten cent cost described in the IEEE guest editorial was for energy (including battery replacement), and not for the amortized cost of the vehicles and vehicle maintenance. Assuming a vehicle cost of $1000 per unit (this is reasonable if Amazon is buying in the thousands), adding 20% per year for maintenance, and amortizing this over 5 years, this would amount to an additional $400/per year, or roughly $1/day. If each vehicle ran 10 missions per day, that’s an additional 10 cents per package on top of the 10 cents in energy costs calculated previously, for a total cost of about 20 cents per package.

20 cents per delivery is far less than what Amazon is currently paying. According to shipping-industry analysts Amazon typically pays between about $2 and $8 to ship each package, and the possible cost of drone delivery as laid out by Professor D’Andrea would go a long way to reducing Amazon’s annual losses of $3.538 billion related to shipping costs they incurred in 2013 and US$ 8.829 billion in cumulative shipping losses between financial year ended 2011 and financial year ending 2013.

Professor D’Andrea also outlines the obstacles to drone delivery, in addition to regulatory hurdles, privacy concerns, etc., indicating that additional automation research is needed to address three main challenges:

  • vehicle design,
  • localization navigation,
  • vehicle coordination.

Answering these points he provides a very good overview of the obstacles:

Vehicle design encompasses creating machines that are efficient, (most probably) can hover, can operate in a wide range of conditions, and whose reliability rivals that of commercial airliners; this is a significant undertaking that will require many iterations, and the ingenuity and contributions from folks in diverse areas.

Localization and navigation may seem like solved problems because of the many GPS-enabled platforms that already exist, but delivering packages reliably, in different operating conditions, in unstructured and changing environments, will require the integration of low-cost sensors and positioning systems that either do not yet exist, or are still in development.

Finally, thousands of autonomous agents in the air, sharing resources such as charging stations, will require robust co-ordination which can be studied in simulation.

He expects that delivery by drones is a real probability and concludes his opinion piece by writing that for better or for worse ‘goods being delivered by flying machines will result in packages flying above our heads in the not so distant future.’


  1. […] read with some interest an article on the Robotenomics blog about the feasibility of drone delivery. It’s an interesting idea, and the article makes a better case than anything I’ve seen […]

  2. […] read with some interest an article on the Robotenomics blog about the feasibility of drone delivery. It’s an interesting idea, and the article makes a better case than anything I’ve seen before. […]

  3. colindroneanalyst says:

    Here is some research I did on drone delivery: http://droneanalyst.com/2014/10/02/drone-delivery-numbers/

  4. […] ロボットエコノミクスが、ドローンによる配送は実現可能かどうかを考察している。アマゾンだけでなく、DHLもテストを開始、またドローンのスタートアップであるサイファイ・ワークスも、配達を5年以内に目論んでいるという。 […]

  5. […] i náklady spojené s takovým doručováním (zajímavý článek na toto téma najdete na serveru RobotEconomics). Doručovací drony by se zatím mohly vyplatit zejména na odlehlých nebo těžko přístupných […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: