Back in 2014, Jeff Bezos said that Amazon (AMZN) would use drones to deliver packages to customers. The idea was great. Customers would get quicker deliveries, and it’s a pro-environment plan. Also, Amazon would lead the way in the age of tech logistics in e-commerce. And, the visionary Jeff Bezos could be the undisputed leader of the future.
However, all the plans now seem to have vanished in thin air. After five years, Amazon is still trying to get its drone delivery plans as a full-time feature across the US. However, UPS (UPS), the American logistics company, has received approval from the Federal Aviation Administration.
Interestingly, the FAA approved the UPS request without any restrictions. In essence, no limits on package size or the scale of operations. UPS made its first drone delivery to WakeMed’s hospital on September 27. UPS could revolutionalize the healthcare sector by using drone delivery. Sounds interesting! By the way, what is the latest update on Amazon drones?
Amazon’s presentation in Greentech 2019
Amazon’s presentation on its drone delivery system, Prime Air, has garnered a lot of responses in the Green Tech Conference 2019. Also, the Environmental Law Institute organized the event. The agenda covered topics on environment protection and the role of technology. The two-day conference took place in Seattle, Washington, between October 1 and October 3.
Obviously, Amazon co-sponsored the event with many other companies. The US-based global e-commerce company was listed among the platinum sponsors for the event. During the conference, a high ranking executive from Amazon spoke about different facets of Prime Air.
Environment and drones
The vice president of Amazon Prime Air, Gur Kimchi, talked about how Amazon drones could be good for the environment. “It is the safest and most environmentally responsible and also highly scalable,” Kimchi said. In addition, he said that the Prime Air program would make operational logistics more efficient. Above all, drones, instead of gasoline vehicles, could help the environment.
Amazon ordered 100,000 electric cars for its delivery centers. Jeff Bezos announced the purchase on September 19. Of course, the bulk order is just one of the steps Amazon is taking to start its climate sustainability initiative.
Prime Air drones and safety
Amazon engineers are working on a drone model that looks like a cartwheel. Also, the drone will have a range of 7.5 miles. Kimchi said that the focus was to make the drones “independently safe.” For this reason, Prime Air engineers have given a TLS (targeted level of safety) for all of its drones.
Needless to say, the TLS estimates consider many factors. These factors include a loss of system control, probability of a lethal event, area of impact, population density, and absence of safe shelter. In a letter sent to the US Department of Transportation, Amazon gave a detailed plan for drone safety measures. The exemption could allow for the use of commercial drones.
Drone deliveries: Amazon competitors
UPS and Amazon are not the only companies going into drone delivery. Even Alphabet Inc (GOOGL), the parent company of Google, is looking into the technology. Wing Aviation, a subsidiary of Alphabet Inc, is developing new models of self-flying delivery drones.
Even Amazon drones will have many impressive features that will ease navigation. The drones will have heat sensor cameras and depth cameras. Additionally, the drones will be designed to navigate smoothly.
Amazon long-term notes redemption
Amazon gave long-term notes at 2.600% in December 2014. The notes, worth $1 billion, shall be redeemed in full on November 5, 2019. At the time of redemption, the company will also pay the accrued interest until November 4. The next series of long-term debt will be 1.900% notes due on August 21, 2020.
A debt series given after Jeff Bezos talked about Amazon drone delivery is due for redemption next month. But the Prime Air drone deliveries are still nowhere to be seen. I believe this is the point where most investors would ask, “When will we get our delivery?” Could Amazon start drone delivery before the next debt series is redeemed? Only Jeff Bezos could answer that.