Explosive growth: autonomous delivery market to reach $4.9 billion by 2030

The global autonomous delivery market, which was worth $860 million last year, seems quite large, but it is still in its infancy. In a new report, consulting firm Markets and Markets projects the sector will grow to $4.9 billion by 2030, with a compound annual growth rate of 21.5%. 

The report, titled "Last-Mile Autonomous Delivery Market by Platform," mentions the development of detection and avoidance systems in delivery drones, the expansion of e-commerce, and the broader use by startups of inexpensive, lightweight delivery drones for grocery delivery.

The document breaks growth down by platform, grouping ground vehicles such as autonomous trucks and vans, along with delivery robots, into one category, and cargo and delivery drones into another.

It notes that the use of autonomous vehicles, regardless of platform, could reduce last-mile delivery costs for retailers by 80-90%. "In addition, the development of technologies for autonomous ground vehicles and increased venture funding for next-generation ground vehicle development have contributed to market growth," the report says.

Markets and Markets said the global coronavirus pandemic accelerated the adoption of autonomous delivery. "Providers are deploying autonomous assets, such as drones and robots, to deliver goods to customers without human involvement," the report says.

Demand in the food and retail sectors will drive the adoption of delivery drones and autonomous vehicles, while long-range cargo drones will outpace other sectors over the forecast period.

"This is due to the high mobility, improved efficiency, and low operating costs of aerial drone delivery services," the company notes. The document says that pollution and urban traffic congestion will encourage the adoption of ground robots.

VentureRadar identified at least 160 companies in autonomous delivery, and that is only the "highest-rated companies" in a search using autonomous delivery as a keyword. 

In recent years, the number of firms in this space has grown sharply, and they include names such as Nuro, Einride, Elroy Air, Vecna Robotics, Uber, Serve Robotics, and Starship Technologies. Markets and Markets named JD.com, Amazon, Kiwi Campus, Zipline, United Parcel Service, Wing, Flirtey, and Aerodyne Group as global leaders.

FedEx and Domino's are testing robotic delivery with Nuro in Texas, Walmart is testing mid-mile autonomous delivery with Gatik in Arkansas, and Uber and Lyft have announced pilot projects for delivery with self-driving cars and shared rides. UPS and Amazon are also working on drone delivery programs.

A Zebra Technologies survey conducted in 2018 found that 78% of respondents expect robots to deliver parcels by 2028, 81% expect drone delivery to become commonplace, and 85% expect delivery by autonomous vehicles.

According to Markets and Markets, North America, and the US in particular, will lead during this period, noting that government and private company investment is advancing autonomous last-mile solutions faster than in other parts of the world. 

According to a recent Business Insider article, venture capital firms invested $24.3 billion in supply chain companies last year, with about half of that amount going to last-mile delivery firms.

That is why, according to industry experts, the venture capital world is likely to focus in 2022 on another emerging generation of startups: those tackling the middle mile. Startups in this area offer a combination of logistics and technology that enables faster final delivery.

The core idea is to build networks resembling UPS or FedEx by combining several players. Most e-commerce parcels must be packed, sorted by destination and carrier, transported to a final delivery station, and then delivered. For retailers to work with alternative delivery providers, they need to find partners to carry out these steps.

Markets and Markets is one of the world's largest producers of market research reports, providing global analysis of many of the fastest-growing industries worldwide. 

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