By Siddarth S April 15 (Reuters) - Autonomous food delivery robots and drones could cut costs by several dollars to as low as $1 per order, a shift that could unlock billions of dollars in profits for
Robots and Drones Could Lower Global Food Delivery Costs to $1 – Barclays Report
By Siddarth S
The Impact of Autonomous Technology on Food Delivery Costs
Barclays' Findings on Cost Reduction
April 15 (Reuters) - Autonomous food delivery robots and drones could cut costs by several dollars to as low as $1 per order, a shift that could unlock billions of dollars in profits for the global food delivery industry, Barclays said on Wednesday.
Strategic Partnerships and Industry Shifts
Global platforms such as DoorDash are partnering with autonomous delivery operators primarily through sidewalk delivery robots (SDRs) and drones to enhance their capabilities, which Barclays said signals a "clear strategic shift."
Current and Projected Delivery Costs
Comparison with Traditional Delivery
Autonomous delivery costs currently range from about $5 to $7 per order drop in early adoption markets with high labour costs, the British brokerage said, which is $3 to $4 cheaper than traditional rider delivery.
Long-Term Cost Projections
In the long term, autonomous delivery costs could decrease to $1 per drop, implying potential savings of $8 to $9, compared with current rider deliveries in higher-labour-cost regions.
Profitability Potential
Assuming about $4 cost savings per drop at long-term penetration levels, Barclays forecasts autonomous delivery could unlock about $16 billion in an annual global profitability pool for food delivery platforms.
Market Penetration and Growth Forecasts
Current Penetration Levels
Autonomous delivery penetration is currently at a nascent stage, with less than 1% of the global food delivery orders, Barclays estimates.
Future Growth Projections
However, the brokerage expects it to rise to about 2% by the end of the decade and jump to roughly 10% by 2035.
Key Beneficiaries in the Food Delivery Sector
Near-Term Beneficiaries
Barclays expects DoorDash and Chinese food delivery leader Meituan to be near-term beneficiaries, given early commercial deployments, platform-level investment and exposure to higher labour costs that could be mitigated via automation.
Long-Term and Medium-Term Beneficiaries
It also projects Uber to be well-positioned, while it bets on Dutch technology investor Prosus to be a long-term beneficiary.
Delivery Hero, its Middle East unit, Talabat, and Southeast Asia's Grab are positioned as medium- to longer-term beneficiaries, Barclays said, with automation developments being pilot-led and small.
(Reporting by Siddarth S in Bengaluru; Editing by Shreya Biswas)
