Last Mile Drone Delivery Market Size, Share, Competitive Landscape and Trend Analysis Report, by Delivery Mode, by Application, by Service, by Model of Operation : Global Opportunity Analysis and Industry Forecast, 2023-2032

Last Mile Drone Delivery Market Research, 2032

The global last mile drone delivery market was valued at $253.8 million in 2022, and is projected to reach $2.8 billion by 2032, growing at a CAGR of 27.5% from 2023 to 2032.

Key Takeaways:

• The report covers the market size for last mile drone delivery for the year 2022 & is forecasted till the year 2032 with a CAGR of 27.5% from 2023 to 2032.
• The report covers segments such as delivery mode, application, service, mode of operation and region.
• The report is studied across different regions such as North America, Europe, Asia-Pacific and LAMEA. 
• The report includes detailed analysis on the last mile drone delivery market studied across numerous industries & their insights have been mentioned in the report.

Last mile drone delivery is considered as one of the modern revolutions in the field of logistics industry to deliver products to customers in minimum time without any delay. It is the final phase of the journey comprising movement of goods from a transportation hub or warehouse to the final delivery destination through drone or any unmanned aerial vehicles (UAVs). The modern era is marked by growing urbanization, e-commerce, and customer expectations for convenience and speed of delivery. Last mile drone delivery delivers products to customers as quickly as possible while minimizing company costs. It is mostly used in food, e-commerce, retail, healthcare and pharmaceutical industries, agriculture, and farming sectors. Presently, rise in use of the Internet along with the expansion of the e-commerce industry drives the adoption of online shopping that in turn requires better and more efficient means to deliver the product to the customer.

In addition, last mile drone delivery market share has gained more popularity during the COVID-19 pandemic and in global war situations, owing to rise in demand for contactless and home-based delivery service. For instance, in March 2023, The Indian Council of Medical Research (ICMR) transported more than 100 units of essential medications over 20 kilometers in Himachal Pradesh and cut down on the time from 120 minutes to 26 minutes. In emergency situations or remote areas with limited access to healthcare facilities, drone delivery logistics provide a quick and effective way to transport these essential items. Drones can deliver medical supplies to clinics, hospitals, and even patients' homes, enhancing patient outcomes and healthcare accessibility.

Furthermore, innovations and investments by top market players boost the growth of the last mile drone delivery industry. For instance, Aergility Corporation launched Hybrid VTOL Cargo Drone. This has encouraged Aergility Corporation to introduce a new concept in the field of last mile drone delivery service. The last mile drone delivery market is expected to witness various developments carried out by top companies, which leads to growth of the Last Mile Drone Delivery Industry.

Factors such as development of e-commerce & logistics, development in infrastructure and environmental concerns by reducing carbon emission, and increase in demand for fast delivery of packages, drive the last mile drone delivery market growth. However, strict government regulations on drones' usage, shorter battery life, and susceptible to hacking, theft, and misuse, are expected to hamper the growth of the last mile drone delivery market size.

Further, adoption of drone delivery to reinforce demand, cost cutting, and lead time reduction, owing to adoption of multi-modal system and growth in e-commerce industry, fills the gap between rural & urban areas to deliver the products is expected to create numerous opportunities for growth and expansion of the last mile drone delivery market size.

The last mile drone delivery market is segmented on the basis of service, mode of operation, delivery mode, application, and region. By service, the market is categorized into business-to-business (B2B) and business-to-consumer (B2C). Depending on mode of operation, it is classified into non-autonomous and autonomous. By delivery mode, it is fragmented into regular delivery and same-day delivery or express delivery. By application, it classified into e-commerce, retail & FMCG, healthcare, mails & packages, and others. By region, the market is studied across North America, Europe, Asia-Pacific, and LAMEA.

Global key players profiled in the last mile drone delivery market report include AIRBUS, Deutsche Post AG, United Parcel Service of America, Inc., Boeing, FedEx, Ehang, DJI, STARSHIP TECHNOLOGIES, Amazon.com, and Israel Aerospace Industries Ltd.

Segment Analysis

By Delivery Mode

By delivery mode, the market is bifurcated into regular delivery and same-day delivery or express delivery. Among these, same-day delivery or express delivery is expected to hold the highest growth rate during the forecast period.

By Application

By application, the market is segmented into e-commerce, retail & FMCG, healthcare, mails & packages, and others. Among these applications, the retail & FMCG segment is expected to hold the highest during the forecast period followed by the e-commerce segment.

By Service

By service, the market is segmented into B2B and B2C. Among these, the B2C segment is expected to lead the market in terms of growth rate during the forecast period.

By Mode of Operation

By mode of operation, the market is segmented into non-autonomous and autonomous. Among these, the non-autonomous segment is expected to lead the market in terms of growth rate during the forecast period.

Technological Advancements in E-commerce Industry

Minimum delivery time along with the demand for better & efficient delivery services for products has increased the trend of online shopping. Over the past few years, the e-commerce industry has witnessed huge growth in various regions globally. Consumers anticipate seamless and quick delivery of their online purchases in the present on-demand economy. Conventional delivery techniques that depend on trucks & human labor sometimes fall short of these standards, particularly in crowded cities where parking issues and traffic jams are common. These problems are expected to be overcome by drones, which allow for faster delivery times and get around stationary obstructions. For instance, in 2023, Amazon decided to expand its drone deliveries in Italy and the U.K., as well as in the U.S. by late 2024, due to rise in demand for delivering online products in minimum time.

Developments in Infrastructures & Environment Concerns

With rise in technology & demand of online items from the customer side, many industries across the globe developed their drone delivery stations. This facility is equipped with charging facilities, maintenance infrastructure, and storage areas for parcels & hubs facilitate the management of drone fleets, facilitating effective logistics and guaranteeing on-time client deliveries. These stations act as central locations for drone fleet managements, enabling efficient logistics and ensuring timely deliveries to customers. Furthermore, stakeholders and regulatory agencies collaborated with each another regulatory framework governing drone operations. A significant initiative in the drone delivery sector is the creation of regulatory sandbox programs and specific aviation corridors. Through these programs, companies can test and implement drone delivery services in controlled environments, giving authorities the opportunity to collect information, evaluate hazards, and improve regulations based on practical experience.

In addition, drone delivery has the ability to cut carbon emissions connected with traditional delivery methods such as trucks and vans, which makes it one of the most appealing environmental benefits. In densely populated urban regions where transportation-related emissions are large, corporations are capable of reducing their carbon footprint dramatically by using electric-powered drones for last-mile deliveries. Drone delivery is becoming a viable option for environmentally concerned customers and businesses as a result of the shift towards greener and more sustainable delivery methods, which are in line with international initiatives to reduce climate change and improve air quality.

Regulatory Frameworks & Government Policy

The legal framework about drone operations is intricate and constantly evolving, considering the wide range of stakeholders, safety concerns, and privacy issues related to unmanned aerial vehicles (UAVs). Drone operators are subject to a patchwork of rules ranging in extent, complexity, and enforcement methods, from local ordinances to national aviation agencies and international entities. Furthermore, the regulatory permission processes for drone operations can be complicated and time-consuming, entailing several levels of bureaucracy and several stakeholders. The timely deployment of drone delivery services is expected to be hampered by delays in getting required permits and authorizations, which affects the growth of the market. Therefore, regulatory frameworks and government strict norms about drones to avoid any future circumstances are expected to hamper the growth of the last mile drone delivery market share.

Bridging the Connectivity Gap Between Rural & Urban Areas

Traditional logistics infrastructure is frequently insufficient in rural and isolated areas, which restricts access to necessary goods and services. Long travel distances, difficult terrain, and unpredictable weather are common problems that remote communities must deal with. These issues are bound to delay the timely delivery of goods and limit the socioeconomic growth.

By overcoming the connectivity gap and enabling dependable access to vital supplies regardless of geographic boundaries, drone delivery offers a revolutionary alternative. Through the utilization of unmanned aerial vehicles (UAVs) that are outfitted with sophisticated navigation systems and payload capacities, businesses can effectively and precisely reach marginalized regions while surpassing the constraints of conventional ground-based transportation. For instance, in 2023, the Government of India delivered the medicine facility that includes 25 kg of medicines, anti-snake venom vials, and other healthcare necessities in the remote, mountainous, and far-flung areas of Meghalaya to save time and costs. This project started with the launch of Asia‐™s first drone delivery hub built at the Jengjal Sub-Divisional Hospital in West Garo Hills district. Such initiatives undertaken by government & private stakeholders to deliver goods & products to rural areas are expected to help to reduce the gap between urban & rural areas in delivering online products.

Key Benefits For Stakeholders

• This report provides a quantitative analysis of the market segments, current trends, estimations, and dynamics of the last mile drone delivery market analysis from 2022 to 2032 to identify the prevailing last mile drone delivery market opportunities.
• The market research is offered along with information related to key drivers, restraints, and opportunities.
• Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders make profit-oriented business decisions and strengthen their supplier-buyer network.
• In-depth analysis of the last mile drone delivery market segmentation assists to determine the prevailing market opportunities.
• Major countries in each region are mapped according to their revenue contribution to the global market.
• Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
• The report includes the analysis of the regional as well as global last mile drone delivery market trends, key players, market segments, application areas, and market growth strategies.

  Last Mile Drone Delivery Market Report Highlights

Aspects	Details
Market Size By 2032	USD 2.8 billion
Growth Rate	CAGR of 27.5%
Forecast period	2022 - 2032
Report Pages	250
By Application	E-Commerce Retail and FMCG Healthcare Mails and Packages Others
By Service	B2B B2C
By Model of Operation	Non-Autonomous Autonomous
By Delivery Mode	Regular Delivery Same Day Delivery or Express Delivery
By Region	North America  (U.S., Canada, Mexico) Europe  (UK, Germany, France, Italy, Spain, Rest of Europe) Asia-Pacific  (China, Japan, India, South Korea, Australia, Rest of Asia-Pacific) LAMEA  (Latin America, Middle East, Africa)
Key Market Players	STARSHIP TECHNOLOGIES, FedEx, DJI, Amazon.com, Ehang, Boeing, Deutsche Post AG, AIRBUS, Israel Aerospace Industries Ltd., Starship Technologies, United Parcel Service of America, Inc.

Analyst Review

Last Mile Drone Delivery Market: Global Opportunity and Forecast, 2023–2032

This section provides the opinions of various top-level CXOs in the global last mile drone delivery market. According to the insights of the CXOs of leading companies, the current market trend and advancement in the e-commerce industry to a much higher level followed by the use of better & more efficient product delivery service has increased across the globe. Furthermore, the last mile drone delivery service has gained prominence in the U.S., Canada, and China, owing to increase in inclination toward online shopping. Companies are also launching unmanned aerial vehicles (UAVs) and drones in more cities owing to rise in demand for reducing the time of delivering products. Also, the adoption of drone delivery solutions is growing at a faster pace and is expected to lead to rapid growth in the last mile drone delivery service in the near future. As per industry experts, a growth of 20% was projected in online retail share by 2023 followed by a 10% growth in the delivery processes, which is expected to supplement the use of drones to deliver the packages; thus, boosting the last mile drone delivery market during the forecast period.

The introduction of different techniques by numerous logistics industries such as drone manufacturers, cargo delivery companies among others through which products and services can be delivered to the customers, boost the growth of the last mile drone delivery market. Various companies operating in the delivery service have made several innovations to deliver the products to customers in a shorter time. For instance, in November 2023, Amazon expanded its drone delivery service to two European countries that is, in the U.K. and in Italy. Amazon also used MK27.2 drone, which is delivering packages to Amazon customers in College Station, Texas and Lockeford, California in the U.S.

In the current scenario, regional governments have played a vital role in driving the last mile drone delivery market by considering last mile drone delivery system to be the efficient means to deliver products in distant areas. For instance, in 2023, the Government of Meghalaya (India) under the World Bank financed Meghalaya Health Systems Development Project delivered essential injections and medicines, which were brought once a week through drone from Jengjal District Hospital over 100 kilometers away. Various other innovations have been carried out by companies such as Amazon to provide better and more efficient product delivery services.

The market growth is supplemented by technological development of e-commerce and logistics industry, development in infrastructure and environmental concerns by reducing carbon emission and increase in demand for fast delivery of packages. However, strict norms of government about drones, shorter battery life, and susceptible to hacking, theft, and misuse, posing security risks are expected to hamper the growth of the market. Further, adoption of drone delivery to reinforce demand, cost cutting, and lead time reduction, owing to adoption of multi-modal system and growth in e-commerce industry, and bridging the connectivity gap between rural & urban areas are expected to create numerous opportunities for the growth and expansion of the last mile drone delivery market.

Among the analyzed regions, Asia-Pacific is the highest revenue contributor, followed by Europe, North America and LAMEA. However, Asia-Pacific is expected to lead during the forecast period, due to increase in demand for last mile drone delivery services in developing countries across the region.

Author Name(s) : Abhay Singh | Lalit Janardhan Katare

Related Tags

• Last Mile Drone Delivery