DAILY NEWS Dec 9, 2013 9:16 AM - 0 comments

Commercial Vehicle Research expert weighs in on Amazon Prime Air

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2013-12-09

Mountain View, Calif.--In a contributed editorial from  Frost & Sullivan's Global Director of Commercial Vehicle Research Sandeep Kar, Amazon's Prime Air, while taking time and mission critical deliveries to a new level, warrants a deeper focus -- not just for how it may enhance online shopping and logistics, but for what it could herald in the industrial world, where drone enabled supplies and deliveries can be regulated and resonate better.

It must be noted that urbanization and rising proliferation of a bricks and clicks retailing model (online retailing), leading to more clicks, are factors that are already driving higher sales and better outlook for light commercial vehicles (such as vans, and light-medium duty trucks used for city deliveries), which poses challenges, such as congestion, emissions, driver shortages, among other factors, in the developed world, said Kar. 

"Amazon Prime Air can solve these problems incumbent on the retail logistics participants. However, it may adversely impact not only commercial vehicle manufacturers (vans/trucks,) but also third party logistics suppliers. Service providers such as UPS and FedEx, among others, could potentially lose a portion of the rapidly growing low-weight time critical urban delivery business, which Amazon could vertically integrate, unless these companies offer similar services to Amazon or other retailers at a cost and value proposition that makes it more attractive for businesses to engage with them," he said. 

That said, there are significant hurdles before these drones become ubiquitous. Several legalities, safety issues, and data/content ownership issues need to be sorted out failing which these drones and Amazon can hit hurdles.

"To once again to reiterate, we at Frost & Sullivan feel that Amazon has clearly shown what is possible and the possibility of this technology and medium to be applied is huge, but the real and meaningful application of this technology lies in intra-factory/intra-company logistics and deliveries and also in the automotive original equipment market and aftermarket where it can bring about revolutionary changes in efficiencies, and cost and time effectiveness," added Kar. 

The trucking industry is a leading indicator of economic activity and also is finding itself adapting to a flat-world ecosystem where it is playing a pivotal role in enabling companies to establish lean and mean supply chains, he said.

 With over 10 years of industry experience, Sandeep Kar, Global Director of Commercial Vehicle Research provides expertise  global commercial vehicle technologies, economics, applications and markets according to many commercial vehicle senior executives. He is based in Toronto and is a highly sought after expert and speaker on the commercial vehicle industry and market trends. Frost & Sullivan is a Growth Partnership Company that provides market research and consultative services to a wide range of industries, among other offerings.



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