Score this as Walmart getting serious – make that really serious – about drone deliveries in its future business success. The retailing giant has just upgraded its relationship with uncrewed aerial vehicle (UAV) service company DroneUp from client to investor/partner.
After tests, Walmart goes all-in for drone deliveries
Walmart announced Thursday it has taken an equity stake in DroneUp as a means of ramping up its UAV activities. Walmart had been working with DroneUp since last year to provide fast delivery services of critical COVID-19-battling products. But its decision to make a direct investment in the company signals the retail mastodon is shifting its UAV strategies into high gear. In case the message in that isn’t clear, that would be Walmart telling Amazon and other mega-rivals, “I’m looking at you.”
By becoming part-owner of the drones and service provider flying its goods, Walmart has signaled a major expansion in its celestial ambitions. Whereas previously Walmart’s focus was getting COVID-19 self-collection kits to customers in minutes rather than hours, the chain is now clearly looking to attain similar speeds in dispatching a far wider range of goods to buyers.
“Now, after safely completing hundreds of drone deliveries from Walmart stores,” said Walmart CEO of US operations John Furner, “we’re making an investment in DroneUp to continue our work toward developing a scalable last-mile delivery solution.”
Critical product mass paired with wide drone coverage
Walmart didn’t reveal what percentage in DroneUp it had acquired, or the amount the transaction involved. But there’s no mistaking it’s a big step in the company lining its ducks up to make online orders delivered quickly by drone a routine part of its daily operations.
The chain notes that its 4,700 stores, stocked with over 100,000 of frequently bought goods, are positioned within 10 miles of 90% of the US population. DroneUp, meanwhile, boasts considerable coverage of its own – operating on-demand delivery flights using a network of 10,000 Federal Aviation Administration (FAA) certified pilots. DroneUp is also reportedly the first operator to have flown using an FAA waiver allowing its craft to pass above people and vehicles, and is an authorized government service provider in 11 US states.
Walmart’s expanded, post-testing delivery services with DroneUp will debut in its Bentonville, Arkansas, store in coming months, and expand from there. The retailer is also expected to diversify delivery options further using autonomous electric vehicles. Last April Walmart took a similar ownership stake in e-car maker Cruise, after earlier partnering with the company in trial automated auto deliveries in Arizona.