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China’s Unmanned Delivery Market: Demand Surged Due to the Pandemic

In the rapidly growing Chinese food delivery and e-commerce markets, unmanned delivery is spreading as a means of reducing delivery costs. Although the profitability of unmanned delivery technology remains uncertain, the outbreak of the new coronavirus in 2020 has led to the rapid expansion of the technology in recognition for the need for no-contact services. In addition to the completion of China’s own satellite navigation system BeiDuo in 2020, the development of a 5G communication network and other advances regarding the technical infrastructure to support unmanned delivery are thought to have contributed to its widespread use.

Unmanned delivery is roughly divided into three areas, unmanned delivery vehicles, drones and delivery robots. Unmanned delivery vehicles are composed of sensors such as cameras and radars, AI chips, and positioning technology as well as automatic driving technology. The companies which develop unmanned delivery vehicles include Neolix, idriverplus and Xingshen. Among them, Neolix has partnered with Baidu’s Apollo automated driving technology platform, and is showing momentum to drive the industry, including the establishment of its own factory for unmanned delivery vehicles. Haomo, an automated driving technology development company under Chinese automaker Great Wall Motor, has also developed an unmanned delivery vehicle. In February 2021, it entered into an unmanned delivery business in Shunyi district, Beijing, in partnership with digital retail platform Dmall.

Logistics and food delivery companies procure unmanned delivery vehicles from these development companies., a major e-commerce site, is active in unmanned delivery to strengthen its logistics system, and while it carries out R&D of unmanned delivery vehicles in-house, it also jointly develops such products with Xingshen and procures from other companies. Similarly, e-commerce giant Suning is also promoting unmanned delivery through its subsidiary Suning Logistics and opened an unmanned warehouse in May 2020. Products can be shipped in 20 minutes from receiving an order using unmanned delivery vehicles and robot arms. In October 2020, Meituan, a major food delivery company, opened an AI-based retail store MAI Shop in Beijing. It is open 24 hours a day and handles everything unmanned from ordering to delivery of products.

China is preparing to host the Winter Olympics and Paralympics in 2022 and is aiming to improve and further commercialize unmanned delivery technology for the Games. The MAI Shop by Meituan, mentioned above, will open at Shougang Park, the venue for the Olympics.

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