Walmart takes on Amazon: Extends air delivery service to 40 million Americans

Walmart has decided to add another 150 stores to its air delivery service, making the service available to more than 40 million Americans.

The company expects the move to help it compete against its biggest rival, Amazon, which has been testing its Prime Air service in the United Kingdom, Italy, Texas and California for several years.

The newly added areas to Walmart's air delivery service include Los Angeles, St Louis, Miami, Cincinnati and other cities yet to be announced.

Walmart’s drone partner, Wing, an American multinational aviation company, said it plans to make “ultra-fast” aerial delivery available to millions of Americans. Wing plans to provide service at 270 Walmart stores by the end of 2027.

Several major companies, including DoorDash, Chipotle, and Amazon have been testing drone delivery service; however, its high operating costs, regulations and tech troubles have made it difficult for them to shift entirely to air delivery.

Drone-based aerial deliveries have become increasingly popular in recent years due to reduced labour costs, faster delivery times, and lower energy consumption for lightweight goods.

In contrast, a report by McKinsey last year found that drone delivery was still much more expensive than traditional delivery systems. It costs around $13.50 per package as compared to $1.90 per package via van.

The Federal Aviation Administration (FAA) has recently allowed operating drones beyond the operator's line of sight if it meets certain regulations, thus making it easier for big franchises to shift to drone delivery.