Alibaba Group Holding Ltd Starts Testing Drone Deliveries In China

The drones will distribute 50 parcels in Beijing Wednesday before moving to Guangzhou and Shanghai

While Amazon is still seeking the U.S. Federal Aviation Administration approval for parcel delivery drones, Alibaba has started a similar drone delivery trial in China. The Chinese e-commerce giant is trying to overcome logistics barriers in the country. The initial testing will be conducted on a small scale. Alibaba’s Taobao platform has invited 450 shoppers in Shanghai, Beijing and Guangzhou to test parcel delivery through unmanned drones.

Alibaba has set some conditions for the trial

The three-day test began Wednesday, February 4. Alibaba has partnered with Shanghai YTO Express (Logistics) Co for the first public air delivery campaign in China. Using five drones, YTO Express will deliver packages within one hour of receiving online orders on Taobao. However, there are a few conditions for the three-day trial.

Einhorn’s FOF Re-positions Portfolio, Makes New Seed Investment In Year Marked By “Speculative Exuberance”

david einhorn, reading, valuewalk, internet, investment research, Greenlight Capital, hedge funds, Greenlight Masters, famous hedge fund owners, big value investors, websites, books, reading financials, investment analysis, shortselling, investment conferences, shorting, short biasIt has not just been rough year for David Einhorn's own fund. Einhorn's Greenlight Masters fund of hedge funds was down 3% net for the first half of 2020, matching the S&P 500's return for those six months. In his August letter to investors, which was reviewed by ValueWalk, the Greenlight Masters team noted that Read More

The drones can fly up to 10 kilometers and carry a maximum weight of one kilogram. But YTO spokesperson Xue Ren said that they will carry goods weighing less than 340 grams for each delivery, and buyers must be located within a certain radius. Another condition is that the remote-controlled drones will only deliver Shou Quanzhai-branded ginger tea packages during the trial.

It’s a one-off campaign

Taobao said in a blog post that the drones will distribute 50 parcels in Beijing Wednesday before moving to Guangzhou and Shanghai. Alibaba told Yue Wang of Forbes that it was a “one-off campaign” where parcels can be delivered to designated regions or cities within an hour. YTO Express said the company was just testing the service, with no plans to expand the service anytime soon.

According to Alibaba founder Jack Ma, about 25 million parcels are delivered every day in China. The number is expected to surpass 200 million by 2024. The future of drone delivery is uncertain in China due to regulatory and safety concerns. Alibaba’s drone trial has triggered a heated debate over whether the technology will help solve problems or be a major hindrance, reports China Daily. Meanwhile, Amazon has started drone delivery testing in India.

Alibaba shares rose 0.15% to $90.75 in pre-market trading Wednesday.