Amazon said Friday customers in College Station, Texas will be able to place orders for delivery by drone, which comes on the heels of last month’s announcement residents in Lockeford, Calif. will be the company’s first to see delivery by drone.
“What happens here will help advance drone delivery for the rest of the country and perhaps the rest of the world,” Texas A&M University system chancellor John Sharp said.
Texas A&M’s drone research likely played a part in helping woo the e-tailer. Amazon cited Texas A&M in its announcement on College Station, pointing to the opportunity to “partner with the city and its world-class university on some of the great work they’ve been doing in the area [of] drone technology.”
The university’s Lone Star Unmanned Aircraft Systems Center at its Corpus Christi location was selected back in 2013 as a Federal Aviation Administration (FAA) test site to study drones.
Amazon said it is now working with customers in College Station on Prime Air deliveries, but did not provide any other specifics around the launch.
In the case of Lockeford, located about 40 miles south of Sacramento, Amazon said “hundreds” of customers there “have expressed interest in receiving their Amazon orders via drone.”
The free service is not available on every item sold on Amazon, but the company said thousands of items qualify for Prime Air.
At the time of the Lockeford announcement, Amazon said it was working with the FAA and local officials on permitting.
Further expansion of Prime Air is in the cards, although the company has yet to disclose future rollout plans.
Amazon has more than 120 open job requisitions for Prime Air, ranging from engineers and applied scientists to ground handlers and maintenance technicians located in places such as Seattle, Wash.; Austin, Texas; and Tracy, Calif.
Logistics is a fast-growing area for Amazon as it looks to best itself on delivery times. In the case of its Prime Air ambitions with drones, it’s pressing its development teams on how to get items to customers in as little as half an hour in some cases, according to one of the e-tailer’s job posts.
Amazon Logistics now rivals heritage parcel carriers FedEx and UPS when it comes to U.S. deliveries. In fact, its market share in 2020 surpassed FedEx’s, with a 21 percent slice of the market. That made it the third largest carrier after United States Postal Service (38 percent) and UPS (24 percent), according to Pitney Bowes’ 2021 shipping index.
Expansion of Amazon’s drone and autonomous vehicle delivery could help grow its market share further, particularly as the company expands its Prime membership incentives beyond its own e-commerce platform with its Buy with Prime program.
The initiative, revealed in April, takes Prime’s delivery and payment benefits offered on Amazon.com and extends them to other online sites.
Amazon’s not the only retailer exploring drone delivery and other business-to-business services to diversify its revenue streams.
Walmart said in May its DroneUp delivery service would add another 34 locations this year for air deliveries to as many as 4 million households in Arizona, Arkansas, Florida, Texas, Utah and Virginia.
Walmart charges $3.99 for delivery with maximum parcel loads of 10 pounds.
The retailer said at the time of the program’s expansion the drone network could be used by other businesses or municipalities at a fee that could help offset delivery costs.
Like Amazon, Walmart is also focused on revenue streams that can be generated in the business-to-business sector. It currently offers advertising for partner brands, fulfillment to its Walmart Marketplace sellers and its GoLocal last mile delivery service that’s used by companies such as Chico’s FAS and Kelly-Moore Paints.