story by Kim Souza
ksouza@thecitywire.com
Wal-Mart Stores has asked the Federal Aviation Administration for an exemption to test the use of drones in its supply chain. The retail giant filed an application for exemption with the FAA on Monday (Oct. 26). The FAA attempts to respond to such petitions in 120 days, said FAA spokesman Les Dorr.
The retailer told The City Wire it has been testing drones within its cavernous distribution centers, but moving the devices outdoors requires FAA approval. The request to test “unmanned aircraft systems” (UAS) follows in the footsteps of Google and Amazon.
“Our goal is to continuously keep testing ways to drive efficiencies in our supply chain to serve our customers more effectively,” said Brian Nick, corporate spokesman for Wal-Mart Stores.
He said the outdoor testing would include helping the retailer manage its massive network of distribution centers, online fulfillment centers and stores. With 70% of the U.S. population living within 5 to 7 miles of a Wal-Mart Store, Nick said drones hold practical possibilities for use in the “last mile” for online deliveries made from stores. Nick said drones may also be used at the distribution centers helping to track what’s inside trucks lined up outside waiting for a dock window to open. He said the retailer is not testing drones in any of its other global businesses, and if they can get a green light from the FAA the U.S. market would be the first.
Kenji Gjovig, founder and CEO of High Tide Consulting, said he’s surprised to see Wal-Mart’s eagerness to test drones, which is almost an about face from the position the retailer had when competitors first launched drone tests more than a year ago. Gjovig said the final mile delivery is the most challenging logistically and the most costly, which is likely why the retailer has decided drones must be considered.
He said the retailer’s recent expansion of its grocery online pickup shows it is serious about using all of its assets to find the most efficient ways to give consumer what they want. Gjovig said he can see possibilities for drone deliveries in Wal-Mart’s online grocery business as well as its test of “Shipping Pass,” which is the unlimited shipping program the retailer launched in response to Amazon’s Prime delivery.
In the application filed with the FAA, Wal-Mart said it also wants to test home delivery in small residential neighborhoods after it gains the permission needed from those living in the flight path.
“The test would see if a drone could be deployed from a truck "to safely deliver a package at a home and then return safely to the same," according to the 11-page Wal-Mart application to the FAA.
Continuing, Wal-Mart notes: “Walmart can ensure that with the combination of the UAS vehicle’s light weight, historically demonstrated flight performance, on board GPS system, fully qualified flight personnel, and strict operation under the guidelines established, the FAA can have confidence that Walmart’s operation will have an equivalent or greater level of safety of any manned vehicle performing the same missions.”
More than 2,100 exemptions allowing commercial use of drone testing have been approved by the FAA. It’s likely Wal-Mart also will get a green light to proceed. However, in August the federal agency raised concerns about drone usage. The FAA said it would levy stiff penalties and possible jail time to companies for unauthorized drone use, citing 650 reports of drone sightings by commercial pilots so far this year. This compared to 238 all of last year.
The FAA Deputy Administrator said in June that the agency plans to finalize all of its regulations for widespread commercial use by June 2016. Companies must now get FAA authorization to use drones, because it’s illegal otherwise.