Ford's interest in drones is growing more serious (F)

Nicholas Shields
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BI Intelligence

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Ford has a new team of engineers and developers in Silicon Valley dedicated to researching how drone technologies could fit into the company's business, according to CNN Money.

The team is led by John Luo, the company's research manager for emerging technology integration, and Adi Singh, the company's principal scientist for small unmanned aerial systems integration. While the company said in a blog post on Medium that it foresees a future where drones can transport packages and eventually humans, it hasn't yet determined any specific plans for how it will integrate drones into its product lineup.

The announcement shows Ford's interest in the drone space is growing much more serious. Back in early 2016, the company partnered with DJI, the Chinese giant that dominates the global drone market, to jointly explore building drone-to-vehicle communication software. In addition, in the beginning of 2017, it revealed a concept design on paper for a commercial van designed to launch drones off the roof to help support a drone delivery network. This research team in Silicon Valley, however, shows the company is interested in further pursuing such opportunities, as it involves the company exploring how it can actually sell or use drones, rather than simply researching concepts and designs.

There are two possible opportunities for Ford in the drone industry:

  • The auto giant could be looking to build specially modified vehicles designed to support various forms of drone delivery services. German auto giant Daimler has already built concepts for such a vehicle that it showed off at CES last year, and it's using similar vehicles to launch drones out of the back of vehicles as part of a delivery service in Switzerland. It's possible Ford could look to make its paper concept into an actual delivery van similar to Daimler's. The US carmaker worked with DHL to build an all-electric delivery van it revealed last August and could sell any future vehicles designed to support drone deliveries to DHL and other logistics providers.
  • It could also explore manufacturing its own drones, though it would face an uphill battle to make inroads into the global drone market. The global market for unmanned aircraft is overwhelmingly dominated by DJI, and new entrants have struggled to gain traction on the Chinese behemoth. GoPro, for instance, had to recall the first drone it made back in 2016, while DJI rival Parrot has gone through two rounds of layoffs since the start of last year, demonstrating the challenging environment that Ford would face if it started manufacturing consumer drones.

Jonathan Camhi, research analyst for Business Insider Intelligence, Business Insider's premium research service, has compiled a detailed report on drone delivery that:

  • Provides an overview of how drones can transform parcel delivery by automating logistics, particularly for last-mile deliveries.
  • Examines the efforts of several companies across industries that are experimenting with drone delivery.
  • Highlights the major obstacles that remain in making drone delivery mainstream.
  • Provides a timeline for the adoption and scaling of drone delivery services in the US.

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