A delivery drone takes off during a functional test at the DroneUp Center in the parking lot of the Walmart Supercenter in Clermont, Florida, U.S., March 30, 2023. Walmart customers who live within a mile of a store can have certain items weighed and have 10 pounds delivered to their home by drone within 30 minutes for $3.99.
Paul Hennessy | Anadolu Agency | Getty Images
DroneUp, a walmart-Supported startups compete side by side amazon And other companies in the nascent drone delivery market are laying off workers, CNBC has learned.
The Virginia-based company began notifying employees of the layoffs Monday morning, said two people who were fired because they were not authorized to speak publicly on the matter, and spoke on condition of anonymity.
Founded in 2016, DroneUp has a fleet of quadcopter-style drones designed to handle the last mile part of the delivery process, moving items like clothing, medicine and food from warehouses to customers’ doorsteps.
The layoffs come as the tech industry continues to downsize and is part of the company’s decision to focus more on its delivery centers, U.S. DroneUp’s network of on-demand order facilities is moving away from enterprise services like construction and real estate monitoring, aviation data capture and marketing, ex the employee said.
DroneUp confirmed the layoffs and strategy change, saying in an email that the layoffs only affected “a small portion of the team,” which currently totals 418 people.
DroneUp CEO Tom Walker said: “Following the massive consumer adoption of our drone delivery service, we have decided to transform our business model to revolve around drone deliveries and other drone services in our hubs. continued growth and successfully restructured our company,” CNBC said in a statement.
Over the next six months, “we will hire more people than we have laid off,” the company said.
DroneUp is one of several startups racing to make drone deliveries a reality. In the past three years, drone, zipline and Feida Signed multi-year partnerships with the following companies walmart Deliver light cargo by drone in as little as 30 minutes.At least 36 Walmart stores in the U.S. offer the service, and the company explain in January.
ups, amazon and letter’s Wing division is also in various stages of developing its own drone delivery service.
Attempts to expand commercial drone deliveries in the United States have been slow, largely due to technical challenges and the Federal Aviation Administration’s lengthy regulatory approval process. The agency has authorized several companies to test drone deliveries in select markets, as long as they don’t pose a significant safety risk.
The economic downturn has also caused setbacks for some drone delivery operators. Amazon laid off a large number of workers in its Prime Air drone delivery unit in January, and the 10-year-old program is preparing to start delivering packages to some customers in two small U.S. markets.
watch: Zipline unveils new drone designed for fast home deliveries
