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Drones in Passenger and Freight Transport Drones in passenger and freight transport KiM | Netherlands Institute for Transport Policy Analysis 2 | Ministry of Infrastructure and the Environment Contents Summary 5 1 Introduction 7 1.1 Background and research questions 7 1.2 Terminology and classification of drones 8 1.3 Structure of the report 9 2 Conditions for development and implementation of drones 10 2.1 Technological developments 10 2.2 Social acceptance 13 2.3 Conclusion 15 3 Applications and market opportunities for drones in passenger and freight transport 17 3.1 Parcel delivery 18 3.2 Unmanned air freight 23 3.3 Unmanned passenger transport 26 4 Conclusions 33 4.1 Conditions 33 4.2 Market opportunities 33 4.3 Spatial effects 35 Literature 36 Appendices 40 Appendix A: The development of sense-and-avoid technology 40 Appendix B: Costs of parcel delivery by drone 41 Colophon 43 Drones in passenger and freight transport | 3 4 | Ministry of Infrastructure and the Environment Summary In future1 drones can be deployed in certain passenger and freight transport markets in the Netherlands. Speed is a key advantage of using drones instead of conventional alternatives, such as delivery vans, airplanes or cars. People will pay more to use drones. Although in absolute terms this could involve large numbers of drone flights, it will pertain to niche markets, relative to the total volume of passenger and freight transport. Technological aspects and social acceptance are key conditions Society is characterised by scarcity. Consequently, there is a continuous incentive to approach matters more efficiently and effectively, which can result in robotisation. It is against this backdrop that the emergence of professional drone applications is considered, such as in agriculture or the public sector. Depending on the type of drone application, certain conditions must be met. For drones to develop, various technological developments and social acceptance are crucial. Moreover, potential conflicts of interest between economic opportunities and societal safety and privacy aspects must be considered. One such example are no-fly zones, which help prevent accidents. However, too many designated no-fly zones can limit the commercial opportunities. For example, in order to deliver goods, drones should ideally fly direct routes covering longer distances. Closed airspaces result in detours and hence higher costs. Three mobility applications of drones Drones fly at altitudes rarely used today. In passenger and freight transport, drones can create new, direct connections and moreover avoid congestion. Transport can be faster, and consequenlty this partly explains the consensus that exists pertaining to the entry of unmanned aerial vehicles into this domain. Three mobility applications of drones are distinguished: parcel delivery, air freight and passenger transport. Further classifications therein are possible – see Figure S1. Such a distinction is pertinent in light of the various market opportunities and spatial effects associated with drone applications. Figure S1 Schematic overview of drone applications in passenger and freight transport. Drone applications in passenger and freight transport Parcel delivery Air freight Passenger transport Application From fixed From fixed Fro oation oation variable oation to Air taxi ing ar Variant to fixed to variable variable oation oation oation 1 This study looked a few decades ahead, but of course implementing drones in passenger and freight transport occurs step-by-step. << Back to table of contents Drones in passenger and freight transport | 5 Various promising options for drone applications in parcel delivery Various promising parcel delivery drone applications exist. Speed of delivery can be a great advantage: some companies expect to be able to deliver within 30 minutes. Moreover, some customers will be willing to pay more for fast deliveries by drones, and this also applies to for example companies needing quick deliveries of spare parts in order to keep production processes running, or to medical applications, such as rapidly delivering defibrillators to certain locations. Nevertheless, most parcels do not require urgent delivery. If speed is not crucial, delivery vans are routinely more efficient from a cost perspective; consequently, they will continue to be widely used in parcel delivery. SESAR, the Single European Sky ATM Research organisation, expects some 70,000 drones to be in Europe’s skies by 2035, delivering 1 to 1.5 percent of all parcels. Weather has a major impact on the performance of small parcel drones and hence on the reliability of the delivery service. Superior weather resistance is a key technological condition for success in the Netherlands, certainly. Further, the number of drones a single drone operator can operate and a drone’s flight frequency have a major impact on the costs per flight. Other crucial factors in further rolling-out this drone application include the development of autonomous control and the corresponding use of sense-and-avoid technology. Application of drones in air freight primarily a niche market Freight drones offer added value to niche markets, in which high value, time-sensitive and/or perishable goods must be transported in smaller quantities than the existing air freight. Market opportunities are bolstered by a lack of competitive alternatives. Compared to parcel delivery, air freight involves longer distances and larger volumes per flight, and air freight drones are also (much) larger. However, given the Netherlands’ extensive transport infrastructure, there are relatively few apparent markets for air freight drones, although there are elsewhere in the world. Costs and safety crucial for passenger transport by drones Passenger drones can be deployed as air taxis, thus allowing passengers to avoid road traffic congestion and speedily arrive at their destinations. As with drone parcel delivery, people will pay more compared to the alternative modality, which in this case are cars. Although higher prices will be apparent in the short-term, they will decrease over time if passengers are willing to share their drone flights with others. The longer the distance, the more advantageous the drones become. Safety is more important for passenger drones than for other drone applications. Passengers must have absolute trust in the aircraft before they will be willing to embark. A select target group can and will use passenger drones, also in the Netherlands. Market opportunities primarily in parcel delivery and passenger transport Market parties are currently investing relatively heavily in parcel and passenger transport by drones, and relatively little in air freight drones. One possible explanation for this is that more certainty exists about where market opportunities will arise in parcel delivery and passenger transport by drones. Emergence of drones has consequences for skylines and spatial planning Drones must be accommodated in the airspace; consequently, the Dutch skyline will change. This will also have consequences for spatial planning; for example, landing sites must be set up, which is challenging, particularly in urban areas, although existing infrastructure potentially offers solutions. To use drones as transport in urban areas, vertical takeoff and landing are a must. 6 | Ministry of Infrastructure and the Environment << Back to table of contents 1 Introduction 1.1 Background and research questions Unmanned aerial vehicles, or drones in common parlance, are claiming an increasingly prominent role in society. Until recently, drones were primarily used for military objectives, but this is changing due to the widespread sale of drones for recreational use. Moreover, the numbers of professional drone users are steadily increasing. Companies and government agencies see opportunities for drone applications; for example, to reduce risks for their personnel, optimise production processes or offer new services. Various (Dutch) research studies have examined possible drone applications. Rijkswaterstaat (2015) studied cases in which drones were deployed in the public domain; the Scientific Research and Documentation Centre (WODC, 2015) outlined the various opportunities and threats posed by drones in the public and private sectors, focusing on security and criminality; and Van der Wal et al. (2016) explored drone applications in agriculture and nature. Observation is a key aspect in many applications; for example, police and fire departments use drones to fight fires, search for missing persons and provide crowd surveillance at large events. Further, Rijkswaterstaat conducted pilot projects in which drones were deployed to help prevent oil leaking into a river, to monitor driving behaviour at traffic intersections, and to inspect water quality and water safety (Rijkswaterstaat, 2015). A consensus exists about the expectation that drone use in civilian applications will sharply increase in the coming years (Airneth, 2016). SESAR, the organisation that coordinates research and development efforts of EU Member States in the field of air traffic management, estimated the market potential of drones. SESAR (2016) expects that some 7 million drones will be used for recreational purposes in Europe by 2050. Moreover, SESAR expects 100,000 drones to be active in agriculture, that public services (such as police and fire departments) will deploy some 50,000 drones for public safety, and that another 100,000 drones will be used for delivery services. Despite this expected growth, relatively little information
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