Self-driving delivery robots may surge by 2040: KPMG

Delivery
vans are lined up prior to dispatch at the Ocado CFC (Customer
Fulfilment Centre) in Andover, Britain May 1, 2018. Picture taken
May 1, 2018.

REUTERS/Peter
Nicholls

• As delivery becomes cheaper because of autonomous vehicles,
  the need for personal shopping trips could get cut in half,
  KPMG estimates.
• To fill the gap, however, one million robots could take to
  the street to deliver everything from pizza to groceries. 
• The consulting firm envisions local “islands” where the
  technology can start, with different options for each geographic
  area based on the market. 

Self-driving cars might allow you to get out of driving across
town to Costco, but it doesn’t mean fewer vehicles on the roads.

According to a
new study from the consulting firm KPMG, if shopping trips in
personal vehicles decline even by half, one million autonomous
delivery robots will need to take to the streets to fill the gap.
For context, the firm estimates there are 300,000 taxis currently
on US streets, and about 1 million buses. 

“The number of bots needed to service such deliveries will be
impressively large,” the consultancy team lead by Gary Silberg,
the firm’s national automotive reader, writes in its report.

“There may well be vehicles that pool such orders, but to meet
that level of urgency, they will not carry many packages to many
customers. All such vehicles must travel from the store or
delivery center to the consumer and return, and they will likely
not move fast since they will need to unload at homes, perhaps
navigating sidewalk. As a result, only a significant number of
these vehicles can meet the totality of customer demand for the
same-hour delivery market.”

Read more: 

Ford
and Walmart are teaming up to test delivering products with
self-driving cars

KPMG expects a majority of vehicles to be used for “instant”
delivery, assumably within the next hour, with the second largest
demand for same day delivery, and a measly fraction for next day
delivery.

KPMG

However, it’s safe to assume companies may try to incentivize
customers to choose slower or more flexible shipping options.
Amazon, for example, already does this to some extent by offering
Prime Now credit to members if they choose a slower shipping
option instead of the company’s complimentary two-day shipping.

A one-size fits all approach won’t work when it comes to
autonomous deliveries, KPMG says. Instead, the firm envisions
delivery “islands” stationed at strategic locations to service
towns or cities. These are places where the population is dense
enough to support the expensive digital infrastructure required
for autonomous deliveries.

KPMG

This means local markets will be the source of competition, and
could theoretically allow different companies to dominate in
regional markets, as opposed to one leader across the country.

“From the analysis of individual islands you [companies] will be
able to make the informed decisions about which markets to enter
or which to continue competing in: how you will meet your own
future,” Silberg writes.

“The revolution is coming. It’s time to prepare.”