U.S. Markets closed

Amazon Gets Government Nod to Test Drone Delivery in UK

Zacks Equity Research

E-commerce giant Amazon.com, Inc. AMZN has announced a partnership with the British government to explore the viability of using drones as a means to deliver packages that weigh five pounds or less. We note that 90% of Amazon’s sales come under this category. The announcement is a step forward in the direction of implementing its Amazon Prime Air services in the UK through which it intends to deliver small packages in under 30 minutes.   

This will be the first time such tests are being conducted in the UK.  
 

AMAZON.COM INC Price

AMAZON.COM INC Price | AMAZON.COM INC Quote

Objectives of the Test

Amazon has been granted permission by a cross-government team supported by the Civil Aviation Authority (CAA) to explore three key innovations. These include  operations beyond the line of sight in suburban and rural areas, automatic obstacle tackling, and management of multiple autonomous drones by one person.

Additionally, as per a CAA representative, it was also reported that care will be taken to ascertain that drone delivery doesn’t affect other airspace users in an adverse manner. Furthermore, during the tests, the altitude of the drones will be limited to a maximum of 400 feet and these will be kept away from airport flightpaths.

Implications

The test will allow both Amazon and the UK government to have a fair understanding of the usability of drones in a safe and reliable manner in the logistics industry. Additionally, it will also help to set the operating rules and safety regulations that are required for the development of the drone industry going forward.

While commenting on the developments, Paul Misener, Amazon’s Vice President of Global Innovation Policy and Communications said, “Using small drones for the delivery of parcels will improve customer experience, create new jobs in a rapidly growing industry, and pioneer new sustainable delivery methods to meet future demand.” He went on to state, “The UK is charting a path forward for drone technology that will benefit consumers, industry and society."

Zacks Rank

At present, Amazon has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology space are EVINE Live Inc. EVLV and Stamps.com Inc. STMP, both sporting a Zacks Rank #1 (Strong Buy) and Manhattan Associates MANH, carrying a Zacks Rank #1 (Strong Buy).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
AMAZON.COM INC (AMZN): Free Stock Analysis Report
 
STAMPS.COM INC (STMP): Free Stock Analysis Report
 
EVINE LIVE INC (EVLV): Free Stock Analysis Report
 
MANHATTAN ASOC (MANH): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research