UPS gets FAA green light for drone airline

Brian Sozzi

United Parcel Service (UPS) said Tuesday it has received government approval to operate a drone airline. The approval came last Friday, UPS disclosed.

UPS says it immediately launched the first drone delivery flight by any company under what is known as the Federal Aviation Administration’s Part 135 Standard at WakeMed’s hospital campus in Raleigh, N.C. The flight was flown under a government exemption allowing for “beyond visual line of sight” operation.

“This is history in the making, and we aren’t done yet,” said UPS CEO David Abney in a statement. “Our technology is opening doors for UPS and solving problems in unique ways for our customers. We will soon announce other steps to build out our infrastructure, expand services for healthcare customers and put drones to new uses in the future.”

“It’s a really substantial pivot,” UPS chief strategy and transformation officer Scott Price tells Yahoo Finance.

UPS also plans to expand its drone delivery service to those outside of the healthcare industry. A UPS spokesperson tells Yahoo Finance those other services initially could be drone service between other UPS sites and corporate campuses.

Partnerships between UPS and major airlines are also being considered, according to UPS.

Reading between the lines, UPS looks poised to take the leadership role in drone delivery for big business and eventually consumers. It’s unlikely UPS will be delivering packages to home residences at least until 2021 as the FAA continues to study safety protocol.

Other companies like Alphabet (GOOGL) subsidiary Wing Aviation have been flying drone delivery test programs with similar restrictions. But Wing Aviation received Part 135 certification from the FAA in April and it plans to expand into commercial home delivery in Southwest Virginia with what it calls, “a delivery trial” later this year.

Yahoo Finance anchor Adam Shapiro contributed to this story.

A drone demonstrates delivery capabilities from the top of a UPS truck during testing in Lithia, Florida, U.S. February 20, 2017. REUTERS/Scott Audette TPX IMAGES OF THE DAY

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