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Alphabet's (GOOGL) Wing to Test Drone Deliveries in Texas
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Alphabet (GOOGL - Free Report) ups its drone game on the back of its well-performing subsidiary, namely Wing, which is known for its drone delivery services.
Reportedly, Wing is gearing up to start testing its drone-delivery program in Dallas, TX, which will mark Alphabet’s entry into the drone delivery space.
Notably, Wing, which announced its Texas delivery plans late last year, has received permission for the program from the Federal Aviation Administration.
To begin with, Wing will sell and deliver items from a Walgreens store in the suburbs of Dallas — Frisco and Little Elm.
The company is also looking into the deliveries of ice cream, pet medications and first aid kits, for which it is working with a few companies.
The latest move of Wing positions Alphabet well to capitalize on the growth prospects in the drone delivery market.
According to a recent Valuates report, the drone package delivery market is expected to reach $3.7 billion by 2027, witnessing a CAGR of 57.5% between 2021 and 2027.
A MarketsandMarkets report suggests that the underlined market is anticipated to hit $39.01 billion by 2030, seeing a CAGR of 53.8% between 2020 and 2030.
Per a report from Mordor Intelligence, the global delivery drone market is anticipated to witness a CAGR of 12% between 2022 and 2027.
The ever-increasing demand for ultra-fast and door-to-door deliveries remains the key catalyst behind robust growth in the drone delivery space.
Competitive Scenario
Given this upbeat scenario, not only Alphabet but also companies like Amazon (AMZN - Free Report) , United Parcel Service (UPS - Free Report) and FedEx (FDX - Free Report) are making concerted efforts to bolster their drone delivery efforts.
Notably, Amazon owns and operates electric drones, which are capable of tilting and flying just like a plane, and deliver packages quickly. Its service, Prime Air, promises to deliver packages up to five pounds in 30 minutes or less using small drones.
Then again, UPS remains well-poised to gain on the back of its strong endeavors. The company’s achievement of the US government's first full approval to operate a drone fleet remains noteworthy. Further, its deal with Beta Technologies for evTOL aircraft remains noteworthy. Beta will make its first deliveries of 10 evTOL aircraft in 2024.
Meanwhile, FedEx has been aggressively looking into deals to expand its presence in the drone delivery market. FedEx’s recent partnership with Elroy Air to test the latter’s Chaparral autonomous air cargo system within its middle-mile logistics operations remains a major positive.
Nevertheless, Alphabet’s deepening focus on drone delivery will likely intensify the market competition.
Image: Bigstock
Alphabet's (GOOGL) Wing to Test Drone Deliveries in Texas
Alphabet (GOOGL - Free Report) ups its drone game on the back of its well-performing subsidiary, namely Wing, which is known for its drone delivery services.
Reportedly, Wing is gearing up to start testing its drone-delivery program in Dallas, TX, which will mark Alphabet’s entry into the drone delivery space.
Notably, Wing, which announced its Texas delivery plans late last year, has received permission for the program from the Federal Aviation Administration.
To begin with, Wing will sell and deliver items from a Walgreens store in the suburbs of Dallas — Frisco and Little Elm.
The company is also looking into the deliveries of ice cream, pet medications and first aid kits, for which it is working with a few companies.
Alphabet Inc. Price and Consensus
Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote
Growth Prospects
The latest move of Wing positions Alphabet well to capitalize on the growth prospects in the drone delivery market.
According to a recent Valuates report, the drone package delivery market is expected to reach $3.7 billion by 2027, witnessing a CAGR of 57.5% between 2021 and 2027.
A MarketsandMarkets report suggests that the underlined market is anticipated to hit $39.01 billion by 2030, seeing a CAGR of 53.8% between 2020 and 2030.
Per a report from Mordor Intelligence, the global delivery drone market is anticipated to witness a CAGR of 12% between 2022 and 2027.
The ever-increasing demand for ultra-fast and door-to-door deliveries remains the key catalyst behind robust growth in the drone delivery space.
Competitive Scenario
Given this upbeat scenario, not only Alphabet but also companies like Amazon (AMZN - Free Report) , United Parcel Service (UPS - Free Report) and FedEx (FDX - Free Report) are making concerted efforts to bolster their drone delivery efforts.
Notably, Amazon owns and operates electric drones, which are capable of tilting and flying just like a plane, and deliver packages quickly. Its service, Prime Air, promises to deliver packages up to five pounds in 30 minutes or less using small drones.
Then again, UPS remains well-poised to gain on the back of its strong endeavors. The company’s achievement of the US government's first full approval to operate a drone fleet remains noteworthy. Further, its deal with Beta Technologies for evTOL aircraft remains noteworthy. Beta will make its first deliveries of 10 evTOL aircraft in 2024.
Meanwhile, FedEx has been aggressively looking into deals to expand its presence in the drone delivery market. FedEx’s recent partnership with Elroy Air to test the latter’s Chaparral autonomous air cargo system within its middle-mile logistics operations remains a major positive.
Nevertheless, Alphabet’s deepening focus on drone delivery will likely intensify the market competition.
Currently, Alphabet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.