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How Drones Could Change The Shipping Industry

How Drones Could Change The Shipping Industry

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.

100 comments on “How Drones Could Change The Shipping Industry

  1. Apparently CNBC forgot about labor supply and demand curves. Increase the pay for truckers, the supply will increase even over and above organic demand growth

  2. Hmmm, anyone who has played the game "Surviving Mars" understands this concept. Medium haul drones that can skip around traffic would be a quick and direct way to improve the response times. The little suckers are NOISY, I expect there are going to be a lot of details to solve. The concept is cool, but I like the concept of having a 3d printer in the garage (plastic or metal) and you simply buy the rights to a 1 copy file to print whatever simple object you want, or multiple copies to print out place settings…….

  3. Yeah I don't agree with this video at all. You're claiming cross-continetal bulk shipping will be taken over by delivery technologies that has the capacity to make pizza deliveries. They're not on the same scale.

  4. 0:07 This video just said that the total goods shipped worldwide per year is about equal to the US's expected federal budget for 2020.

  5. It may cause to make frequent accidents by falling cargos from drones… There would be thousands of drones in the air with cargos, may collide each other..

  6. So businesses are trying to keep employee numbers low… but we live in a world with an ever growing population? Hmmm…. something is becoming a problem…. already is….

  7. Tesla cars that slam into the side of your house to deliver your groceries = what a great idea. No, actually I do think that there is a place for automated delivery trucks that carry a tracked parcel delivery robot that is capable of crawling up/down stairs and delivers the parcel to your front door. That is totally possible like last year.

  8. Truck drivers can make more money flipping burgers in burger king than driving a truck, so why should he/she drive a truck?

  9. The consumer is just fine with 2 day shipping. All you companies made us think we need it faster. It's like with Apple, they made you think what you need what you don't really need (certain features on a phone). The problem is that people need to slow down and be grateful for what we have. Everyone is so used to instant this and instant that that we start expecting things that are unrealistic, and sometimes stupid. If y'all can't wait two days for you new anything beyond meds or something, then reevaluate your life.

  10. Can’t wait for 38K Lbs shipping container to fall on top of my car so I can sue the living crap out this company. How about to start paying truck drivers real money

  11. I wonder how many drug runners will be using this? May be able to get your meth delivered right to your door!

  12. Drone delivery is a complementary not a substitution to the container shipping method. Do you expect the drone to deliver goods across the pacific?

  13. Good Lord!! Who is the sissy boy announcer on this video?
    When did trained announcers lose their jobs?
    Can this soy boy’s voice be more affected??

  14. This is Earth. We have really bad weather. And alot of criminals. Not to mention, multiple aircrafts. Drones are not silent for sure. Make inner- state vacuum tube system or something

  15. The slower shipping methods are more energy efficient though. This video makes me a little angry, because it assumes shipping times are more important than the environment, and they really aren't.

  16. "sounds good doesnt work"..unless teleportation is made, logistics will remain on human resource, the fragility of electronics will always remain as the main problem of unmanned machines, Switching to unmanned is a great risk for business as u put all ur business name and trust on a machinery that can be easily disrupted by simple glitches…the best way is simplify machine at its best efficiency coupled always with real time human contact

  17. How about teleporting?
    1) 3D scanning of stuff at atomic precision.
    2) sending file through internet
    3) 3D printing the stuff back, at atomic precision too.
    4) destroy the original.

  18. My family has a history of truck drivers and longshoreman working the roads and docks here in the United States. Laboring and long hours result from being on the job. One way to alleviate these struggles is to implement aeronautical drones for cargo transportation of goods and products. I am getting the UAS Drone FAA certification in the near future so I hope this works soon. Would rather work in an air conditioned facility than to be slaving out on the field.

  19. This is probably in competition with bike deliveries, mini delivery trucks and last mile shipments regional…. If they want to do anything cross country(like ships) they will need the bulk shipments to be worth and by pass cross country laws by that time you might as well send it by airplane .

  20. Lol, drones delivering packages? It’ll never happen. First it will be a hazard having a shitload of drones flying around and second it will disturb the ecosystem with birds.

  21. they better have insurance cause a package can fall out of the air and hit me in the head am SUEING lol if i live

  22. Your not going to be able to ship huge tonnage of freight via’s too heavy and you don’t have the energy source to sustain over start flying everything and you eventually run into the big elephant in the room..what do you use for fuel..advancements in electrical powered planes is not where it needs to be..the only possible solution would be..hyperloop rails designated for cargo..that’s the only feasible thing right now until a better energy source can be discovered

  23. Always looking for that new "disruption", that new growth stock, shaving the "bottom line". People with no conscience peddling their vision of the future, CNBC selling it as business journalism. Sponsored? Nobody mentioned increased greenhouse gasses, with addition of all these hybrid vehicles flying around? Are they just prostitutes?

  24. It makes more sense to have a manufacturing part store for replacing bad parts asap. It is like an auto parts store but on a larger scale.

    Drones are good for Air Freight but the amount of resources to fly is incredibly difficult. Smart analytics can minimize the need for Air. I don't think drones are the end all solution for improving the air freight. Optimizing the airplane would be key. Another option is a carry on app for sending shipping via air packages. Basically, if you have a flight and someone wants to add a stored item, they get paid to add it into their package and then they deliver it to the kiosk that inspects the package and delivers it to the next person. It would cut the cost of small items and optimize storage space. So if the weight is less than 5 lbs, you can do it. But it would go into their bags. The person at the kiosk would rate the package or the next person delivering it would take photos of the package and deliver it. You could easily create a package distribution system that allows an item to ship within a day via airplane passengers. Then have a rating system and a banning system in case something happens like Uber for airplane shipping. Or DOFL for airplane shipping. Regardless, it could make small time purchases and delivery work faster and cheaper as individuals would love the idea of making a few extra cash by shipping via checking it in their baggage and then transferring it to another person who inspects and checks it in their baggage or gives it to a kiosk or vending machine for the next person to pick up on a flight. I can see contraband or other security concerns being a problem there though and you would have to get the support of the airlines too. But it would cut costs and likely increase the amount of checked bags increasing the profits of the airlines.

    But transporting freight still has the best solution to non-urgent items. It is easier to go on a 2d plane than it is in 3d. The other issue is that I think that we are looking at a multi chained delivery system and trying to keep it only drone to boat and vice versa. It can be a triathlon type where the main boat acts like an aircraft carrier for the boat drones who then pass it on to trains or something similar. Drones are just the pizzaz solution that people want. No one cares how their shipment gets there. They care that it is what they expect.

  25. Space pirates will soon be able to steal your bulk pack of silver plated vibrators before you get them and sell them to you on ebay for less than the Chinese slave children can make them for between suicide attempts.

  26. One pilot to manage multiple flights remotely, lol. Yeah, can't wait until the first screw up which crashes 10 planes.

  27. CNBC – I usually love these kinds of videos, but this one is pretty darn upsetting. Firstly, as so many people have pointed out, you are not making a distinction between huge freight and last mile deliveries to homes. Additionally, you briefly touch on a ton of different bold subjects/claims/statements without actually making consistent point and explaining everything overall.

  28. I'm thinking to build 5million tons drone combined ship that will fly each places like helicopter and land in Sea carrying only containers for transportation.

  29. Sounds BS that there's shortage of truck drivers. Sometimes I get stuck for 2-3 days to get a load or I'm driving 600-700ml empty to somewhere to get some cheap load. STOP fooling people with disinformation

  30. They won't let us use drones ..there scared of their own shadows and afraid someone may do what they would do..

  31. The only way to revolutionize the freight industry is by electric powered planes who can fly with 20 to 100k lbs of freight from one destination to other anything below it…. its still a long way to go….

  32. This idea will never be for large scale. Must have shipping done in the most efficient way possable. Not one package per vehicle. Think what the sky would look like. It's easy now since its soo new but it will never work. These little crafts will start crashing into airplanes and killing people and that will keep it unusable aswell. It's a joke

  33. Drones will be banned once it's used for terrorism. Nobody wants these things flying around. What if they crash and kill someone. It's never goin to be large scale and itll still our jobs.

  34. I work on a port in one day they can have 3 ships that need 2,000 lifts (taking containers off and on) and are done in 2 days max then off to the next port.This happens everyday no way you can beat a ship that can carry 20,000 containers

  35. Air traffic still is terrestrial traffic. Some bulbs shine brighter than others. CNBC consultants are weakling a bit in the luminosity department.

  36. This is not a good idea some things should stay on the ground . If this ever happens their going to further limit hobbyist drone pilots or ban in all together.

  37. What if a 6 lb drone fall on my car from 500 feet high, wouldn't that be a sight? Especially when I am driving at 65 miles per hour.

  38. Shortage of truck drivers 😂 it’s more like people are consuming more. When you won’t need people anymore to these jobs who is gonna buy all your crap?

  39. I think this is a great idea especially for developing countries and undeveloped areas that lack roads/rails…roads/rails cost around $2-$20 million per mile just to build + maintenance cost also doesn't work well in crowded or densely populated areas just creates traffic….cargo drones don't require roads/rails and can travel from point A to point B in a straight line meaning the distance would be less…so if they figured out the engineering issues and got it working efficiently seems like it would be a lot better than using roads/rails…also there's lots of space up in the air in many densely populated areas there's no space on the ground…also car accidents kill more than 30,000 people/year in the US alone and no one seems to be complaining…

  40. So instead of telling young or unemployed people to learn to code, we should tell them to learn to pilot drones?

  41. This is not good, air travel is the least efficient mode of tramsport. We need to end same day or next day shipping

  42. I accept its niche potential, but I doubt it will be so disruptive. Thousands of drones buzzing about densely populated streets does not seem very safe from the viewpoint of those on the ground, let alone the many users of airspace. Once a member of the public gets badly hurt by a freight drone, expect them all to be grounded. A sober re-assessment of the system will follow.

  43. I can appreciate testing the need and technology, but shipping is about "bulk" unless its an emergency health ..thing. I don't see autonomy cargo shipping in the air anytime soon.

  44. Why could they not team up with a company like Uber or Lyft for last mile delivery? The infrastructure is already there and proven. At least as a bridge source until everything else shakes out. Seems like self driving cars will be here long before autonomous drones. Also doing the long haul shipping first, they're putting the horse before the cart. IDK, just a thought.

  45. But drones cant carry large boxes and what if you order multiple boxs and are shipped at once drones can only carry like one box

  46. Screw drones, Employ delivery people. The push for drones and the mindless drive for automating everything benefits corporate executives/shareholders and no one else.

  47. The cost of pilot is very small compared to fuel and maintenance. On the other hand, the cost of error by a drone plane like like crashing would be catastrophic.

  48. 'There's a xy…Truckers shortage' Yup living 24/7 in a moving coffin without access to a
    proper toilet, basic needs of a human being for less than minimum wage is something
    everyone is dying to get into, plus you need to be away for at least 3 weeks, the dbags
    brag about 'out for 3 in for 1' which may or may not be possible. All the responsibility is
    on the truck driver, somethings wrong with the tailight ? you get a ticket, with the wipers
    yup you get the ticket, corporate parasite craftily shifted all the negatives onto the worker
    while keeping most of the profit and this applies to all jobs in the USA.

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