FAA Probes Amazon Drone Incident in Texas

Amazon (AMZN) is under federal scrutiny following an incident last week in central Texas where one of its delivery drones snagged an internet cable. The event raises questions about the scalability and reliability of drone delivery programs as Amazon seeks to broaden its Prime Air initiative across the U.S.

The investigation surfaces amidst intensifying competition in the drone delivery space. Walmart (WMT) is aggressively expanding its own drone delivery services, challenging Amazon’s long-held ambition to dominate the last-mile aerial logistics market.

According to a video verified by CNBC, the incident occurred on November 18th around 12:45 p.m. Central Time in Waco, Texas. An Amazon MK30 drone, after successfully delivering a package, was ascending from the customer’s property when one of its six propellers became entangled in a nearby internet cable line.

The video evidence clearly shows the drone severing the cable. Subsequently, the drone’s motor appeared to automatically shut down. Implementing its safety protocols, the drone initiated a controlled landing, with propellers visibly windmilling during its descent. While one propeller sustained visible damage, the drone appears to have remained structurally intact.

A spokesperson for the Federal Aviation Administration (FAA) confirmed an active investigation into the matter. The National Transportation Safety Board (NTSB) acknowledges awareness of the incident but has, as of yet, not initiated its own dedicated investigation.

Amazon corroborated the incident in a statement to CNBC, emphasizing that the drone executed a “safe contingent landing” after the cable strike, adhering to its programmed protocols for unexpected operational conditions. The company’s drone employes sophisticated algorithms to identify safe landing zones and execute controlled descent profiles in such scenarios.

“There were no injuries or widespread internet service outages. We’ve paid for the cable line’s repair for the customer and have apologized for the inconvenience this caused them,” an Amazon spokesperson stated to CNBC, highlighting the successful completion of the delivery prior to the incident.

This cable-snagging event follows a separate federal investigation initiated last month into a mid-air collision involving two Amazon Prime Air drones in Arizona. The drones collided with a construction crane in Tolleson, Arizona, prompting a temporary suspension of Amazon’s drone delivery services in that region.

The root of Amazon’s drone-delivery ambition stretches back over a decade. Driven by founder Jeff Bezos’ vision, the objective has been to deploy drones capable of delivering packages – ranging from everyday items to critical pharmaceuticals – within a 30-minute window. Amazon initiated its first drone deliveries in 2022 in College Station, Texas, and Lockeford, California.

However, progress has faced headwinds. Regulatory complexities, missed project deadlines, and strategic realignments like the 2023 layoffs within the Amazon drone division which paralleled broader corporate cost-cutting initiatives under CEO Andy Jassy, have all impeded momentum. These operational adjustments reflect the underlying challenge of balancing innovative logistics with the practical constraints of regulatory compliance and economic viability. Amazon, for example, will have to prove to regulators that it has safety systems in place to prevent drones from flying above people or cars, as well as other safety and security hurdles.

Amazon has stated a target of achieving 500 million drone deliveries annually by the end of the decade. This aggressive target necessitates significant technological refinement, operational scaling, and the resolution of ongoing safety and regulatory hurdles before a drone can be fully operational. Failure to create these milestones may impact its goal of expanding to a much larger scale than is currently in place.

The MK30, Amazon’s latest hexacopter Prime Air drone is designed to be quieter, smaller, and lighter than earlier models. This new drone also has an extended range, can fly in more diverse weather conditions and can carry more diverse packages. This model builds upon its predecessor’s sensors and technology to create better range and broader utility.

Amazon claims its drones are equipped with an advanced sense-and-avoid system, designed to detect and steer clear of aerial and ground-based obstacles. The drones incorporate LIDAR (Light Detection and Ranging) and computer vision, allowing them to build a detailed 3D map of their immediate environment. This is intended to ensure safe routes and package delivery. The company recommends that customers maintain a minimum of 10 feet of clear space on their property for safe drone operations.

Amazon’s drone delivery service opened in Waco earlier this month for customers within a set proximity of its same-day delivery center ordering eligible items weighing five pounds and under. The promise is deliveries in under an hour. This launch in Waco illustrates Amazon’s strategic approach to controlled expansion, allowing them to fine-tune delivery protocols and data collection within a defined geographic area, making tweaks and optimizations as needed.

In recent months, Amazon has expanded its drone delivery network to additional locations, including Kansas City, Missouri, Pontiac, Michigan, San Antonio, Texas, and Ruskin, Florida. The company has also announced expansion plans to Richardson, Texas, a suburb of Dallas, furthering showing Amazon’s ongoing investment in scalable drone infrastructure.

Walmart’s move into drone delivery began in 2021. The retailer partners with Alphabet’s Wing and venture-backed startup Zipline to provide drone delivery services across multiple states, including Texas. These partnerships give Walmart to broaden its reach and delivery ability with a smaller investment than launching its own program.