FedEx CEO says drones unlikely to make big impact

Published on NewsOK Modified: December 18, 2013 at 1:51 pm •  Published: December 18, 2013
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MINNEAPOLIS (AP) — The CEO of FedEx doesn't see drones taking over the package delivery business anytime soon.

Fred Smith says FedEx has several drone studies underway. But the idea of delivering items by drone is "almost amusing," Smith said on a conference call on Wednesday after the company reported financial results.

Smith said FedEx has a drone expert on staff — its technology chief, Rob Carter.

"He actually owns a drone," Smith said. "He reported that it operates about eight minutes and can carry four Budweiser beers at his farm."

Jeff Bezos, the CEO of Amazon.com, caused a stir recently when he said Amazon is exploring drone deliveries, and that sending a small package via an automated drone could be reality in a few years. United Parcel Service and German delivery company Deutsche Post DHL have both said they are evaluating drone delivery.

There are huge obstacles to residential drone deliveries. The U.S. Federal Aviation Administration barred their use for commercial purposes in 2007. No-fly zones abound in places like Washington D.C. There are questions about who is liable if a drone crashes and damages something, or someone, on the ground.

The comments from Smith, who is also FedEx's chairman and president, came in response to an analyst's question about online sellers getting into the business of delivering goods themselves.

Smith said Amazon and other online retailers "can unquestionably do local deliveries should they choose to do so."

But, he added, FedEx, UPS, or the U.S. Postal Service will perform the vast majority of deliveries. The three organizations are designed to handle large-scale deliveries, including costly deliveries to residences, Smith said.

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