Game of Drones - Viability Study of Drone Deliveries in Swedish Rural Last Mile Transport

Problem discussion and objective: Despite its well-established networks of service points, Swedish logistics carriers are still facing many last mile challenges in terms of satisfying customers and becoming more sustainable while also being profitable. These challenges are expected to escalate especially in Swedish rural areas which cannot be solved by conventional methods. A drone is an unmanned aerial vehicle (UAV) which is an innovative transport mean featured with high flexibility and efficiency. It is regarded as a potential transport method in rural areas with poor infrastructure. Therefore, this study aims at examining the viability of drone deliveries in B2C last mile logistics in Swedish rural areas. Methodology: This study firstly carried out a systematic literature review in the existing academic articles focusing on drone deliveries. Then, five Swedish rural municipalities were selected for conducting detailed research on and provided the ground for simulations. The simulation conceptualized the delivery routes in a real-life setting between service points and churches in order to compare the delivery time between vans and drones. Results and Conclusion: The results show that although drone delivery has many development opportunities, it is not ready to be implemented at the present stage but may become a feasible solution in the future. Firstly, the legal framework supporting the integration of drones into logistics networks is well under way. Secondly, most of the delivery routes in the simulation are found to be time-saving with drones. But it has become less competitive due to its current technical constraints, in scenarios such as increased service coverage, ground vehicles driving in high-speed, or harsh weather. Thirdly, drones are more environmentally friendly than conventional vehicles. Fourthly, Swedish customers expect the home delivery of better service quality which poses additional opportunities especially in rural areas. Which makes drones to be a potential cost-effective solution for carriers with increased service level. Lastly, public acceptance currently of drone logistics is limited especially in Swedish rural areas of ageing society, which could be solved by deploying correct public relationship strategies with the maturity of previously discussed aspects.MSc in Logistics and Transport Managemen