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How Drones Could Change The Shipping Industry

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10:00   |   Jul 23, 2019

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  • Today, container ships transport more than 90 percent of all goods in
  • the world and more than 4 trillion dollars worth of goods annually.
  • But it can take over a month for those goods to sail from Beijing to
  • New York.
  • By land, trucks move nearly 71 percent of all freight tonnage in the
  • United States.
  • Problem is, there's a shortage of truck drivers in the U.S.
  • So how do you speed up shipments while keeping personnel low?
  • The future of shipping looks very much unmanned.
  • Anything that has high levels of customization, anything that's
  • unpredictable, that should be done by air.
  • Many startups believe the answer is autonomous flying cargo drones
  • that can carry heavy loads and fly long distances.
  • All around the world, millions of people are benefiting from drones
  • already, and we're just at the tip of the iceberg.
  • The global drone logistics and transportation market accounted for
  • more than 24 million dollars in 2018, and that number is expected to
  • grow to 1.6
  • billion dollars in 2027.
  • These drones could be the disruption needed in a global supply chain
  • that has been largely unchanged since the 1950's.
  • Getting large shipments of products across large distances is
  • difficult. That's why Malcolm McLean created the shipping container
  • in 1956.
  • This standardize the shipping industry and allowed shipping to scale
  • in ways that weren't possible before.
  • For a typical product that is being shipped from overseas and then
  • received within the United States, that would involve trucking, ocean
  • freights, in some cases we're seeing the emergence of more rail being
  • used as it's becoming a more reliable mode of transportation.
  • But now, with programs like Amazon's one-day shipping, consumers are
  • looking for goods to get to them faster.
  • That means the standard shipping methods – ships and trucks – have to
  • be re-evaluated.
  • There is a seemingly insatiable demand for things right away by
  • consumers and that just keeps growing and people become increasingly
  • impossible over time.
  • What it seems like is the supply chains, which are wildly complex, are
  • built around the timeliness of air freight.
  • But the cost per item for air freight is significantly more expensive
  • when compared to sea and ground shipping.
  • We're at the point where you really need to have those high-value
  • goods or some kind of an emergency shipment would be an ideal
  • candidate for air freight because it cost so much.
  • In the United States in 2016, 11.6
  • billion tons of goods were shipped via truck, 1.8
  • billion tons were shipped via train, 740 million tons were shipped
  • via a cargo ship and only 5 million tons were shipped via airplane.
  • But using autonomous flying cargo drones to ship goods might bump
  • that number up.
  • Air freight is actually a mode of transportation that has increased
  • dramatically. It's still a small percentage of all freight being
  • moved, but if you look at the percentage change over the years, air
  • freight has been growing much more rapidly.
  • I think a big reason for that is the growth of e-commerce.
  • If you're living in a small village and you want to ship goods and be
  • a part of a global economy, often your freight link is by road or
  • rail and it takes quite some time for your goods to be transmitted
  • around the world.
  • So when we bring autonomy and scale into aviation, every community
  • can be connected with the rest of the world through a airborne
  • freight link.
  • And I think that that means massive potential for economic growth in
  • communities all over the world.
  • The main challenge is volume.
  • You just can't lift as much weight into the air as you can floated
  • along the sea, especially if you're trying to use battery powered
  • vehicles like many of the smaller drones we see today. Current
  • battery technology is incredibly heavy. Volans-i, a
  • drone company that has been working in this space since 2015 created
  • a hybrid vehicle that uses electric power to take off
  • vertically, then standard fuel to fly off horizontally.
  • So, if you build an all-electric vehicle, you have an 85 percent mass
  • fraction on the batteries.
  • So that means you can carry 15 percent the rest of the weight in
  • payload, which doesn't really make sense for cargo delivery.
  • See, the more volume you carry, the cheaper shipping becomes, even if
  • that means traveling longer distances.
  • Going in from Shanghai as an example, to the United States might take
  • about 28 days by ship, whereas by airplane it'll only take 14 hours.
  • But still, ships are cheaper.
  • A medium sized 2,000 pound box from Shenzhen, China to New York can
  • cost $1,200 by ocean, but it can cost $4,000 by air.
  • Natilus is working on getting that volume up and the costs down by
  • using jet fuel powered drones to autonomously fly goods long
  • distances, like across the ocean.
  • Natilus is building large-scale unmanned aircraft the size of Boeing
  • 747s to reduce global air freight costs by 50 percent.
  • It will do this by using a uniquely shaped vehicle designed for cargo,
  • not passengers, unlike other air freight carriers.
  • When Boeing and Airbus design airplanes meant for passengers, whatever
  • falls out is what the freight aircraft looks like and they're not
  • really optimized on volume.
  • It also wants to utilize pilots more effectively. Instead
  • of having two pilots on one single flight, it hopes to use one pilot
  • managing multiple flights remotely.
  • There's a huge bottleneck with pilots today, which is limiting the
  • expansion of air freight as well as passenger freight.
  • But Natilus is still not ready to get its cargo drones into the air
  • for deliveries.
  • Companies like Volans-i have already started making deliveries in
  • places like the Bahamas, a particularly difficult area for deliveries
  • because of the large distances between islands.
  • The company's goal is to alleviate the shipping strains of high need,
  • expensive shipping, like when a specific part needs replacing on a
  • production line, and it needs to be replaced quickly since time is
  • money.
  • I started Volans-i out of a problem that I saw while working at Tesla.
  • So imagine the Model 3 assembly line goes down for one hour. That
  • costs the business hundreds of thousands of dollars, in some cases
  • millions of dollars.
  • And at that point, the companies and businesses are motivated to get
  • that up-time and get the line going again at any cost.
  • And Volans-i is trying to help with that business and with that
  • problem.
  • Other companies are trying to lighten the load of the ever critical
  • last-mile delivery.
  • That's the portion of the shipping process that gets the product from
  • its last warehouse or shipping hub to your door, and trying to hasten
  • the delivery of medical supplies and samples for testing.
  • Zipline has been delivering supplies in Rwanda since 2016, Ghana
  • since April of 2019 and is expanding its service to the U.S.
  • this year.
  • UPS has teamed up with drone startup Matternet to quickly ship
  • medical supplies from a North Carolina hospital to labs for testing.
  • I think we can use this type of system to massively improve
  • health care in the country.
  • So imagine when you have to get that lab result back, how crucial it
  • is to get it on time.
  • And with a system like this, we can deliver the samples and then the
  • results much faster than we can do it with the traditional
  • transportation methods today.
  • But news of these delivery drones has been flying around for years.
  • Prime Air, Amazon's drone delivery system, was teased back in 2013
  • and it still hasn't rolled out the program, though Amazon recently
  • announced that it will launch delivery drones within months.
  • We're building fully electric drones that can fly up to 15 miles and
  • deliver packages under five pounds to customers in under 30 minutes.
  • Well, the biggest thing I believe that's pacing the development of the
  • drone industry is regulation.
  • FAA regulations are still pretty strict on these autonomous flying
  • vehicles, and that has created a challenge for these drones.
  • Competition for airspace is becoming more and more heated as drones
  • of all sizes take to the air.
  • There have been some restrictions by the FAA that have restricted the
  • use of drones for delivery to consumer homes, and, you know, that's
  • something that needs to be overcome and they're continuing to work
  • on.
  • Autonomy brings a whole new set of public concerns, just as we've seen
  • with self-driving cars, because the public has grown to appreciate
  • the safety and the assurance of being able to fly from one place to
  • another. The regulators are hesitant to permit new technologies from
  • entering the airspace until they are really proven satisfactorily.
  • Another big concern when it comes to automation is jobs.
  • As you hear some of the challenges related to drones, that's one of
  • the things I've heard come up.
  • There would be this whole workforce needed to be able to manage this
  • drone network.
  • But this technology could help alleviate some of the worker shortages
  • that the shipping industry is facing.
  • I think what you're seeing today, the airline sector, for example, has
  • a massive pilot shortage and it's forecasted to only get worse than
  • the number of people that are going to be traveling by air is
  • expected to double over the next 15 years.
  • But customers, shippers and regulators all see the promise in these
  • autonomous flying vehicles for emergency deliveries, for incredibly
  • high speed home deliveries and even for large shipments of goods.
  • So I think that there's great opportunity here with unmanned cargo
  • aircraft to start proving out some of the technologies in a
  • lower-risk environment without people on board, and these same
  • technologies can eventually be introduced to the aircraft that we
  • will use for flying around cities to and from work.
  • And I'm really excited about skipping the terrestrial traffic as
  • well.

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Description

Today, container ships transport more than 90% of all goods in the world, but it can take over a month for those goods to sail from Beijing to New York. Cargo drones could be the disruption needed in a global supply chain that has been largely unchanged since the 1950s.

By land, trucks move nearly 71 percent of all freight tonnage in the United States, but there's a shortage of truck drivers in the United States. So how do you speed up shipments while keeping personnel low? The future of shipping looks very much unmanned.

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How Drones Could Change The Shipping Industry