"Drone Lunchbox Delivery"... Will It Become a Familiar Scene in the Untact Era (Comprehensive)

Ministry of Industry, ETRI, and Others Hold 'Drone Utilization Distribution Logistics Innovation Demonstration' Event
Government Invests 18 Billion Won as Part of 'Drone Utilization Service Market Creation Support Project'
GS Uses Gas Stations Nationwide as Drone Delivery and Future Mobility Hubs

On the morning of the 8th, at the GS Caltex Musucheon Gas Station in Jeju Island, the NeonTech (ND-820) drone body is rising into the air during the 'Drone Utilization Distribution Logistics Innovation Demonstration Event.'

[Asia Economy Reporters Kim Bo-kyung and Hwang Yoon-joo] On the morning of the 8th at Musucheon Gas Station in Jeju Island, a 2-meter drone carrying convenience store lunch boxes and beverages leisurely took off into the sky. People around applauded and cheered. The drone flew 1.3 km to a pension and safely delivered the lunch box to the guest before returning. Although this was a demonstration event rather than an official delivery, attendees anticipated that such scenes would become familiar in the future contactless (untact) era brought about by the COVID-19 pandemic.

The Ministry of Trade, Industry and Energy held a demonstration event for drone-based distribution and logistics innovation that morning at the GS Caltex Musucheon Gas Station in Jeju Island, in collaboration with the Electronics and Telecommunications Research Institute (ETRI). About 40 people attended, including Huh Se-hong, President of GS Caltex; Won Hee-ryong, Governor of Jeju Province; Choi Nam-ho, Director of Manufacturing Industry Policy at the Ministry of Trade, Industry and Energy; Cho Yoon-sung, President of GS Retail; and Park Jong-hyun, Director of ETRI.

At the event, a service was demonstrated where food and beverage products ordered through the GS25 convenience store application were loaded onto a drone at the GS Caltex gas station and delivered to the customer. The round-trip delivery distance was about 2 km, with a flight time of approximately 5 to 6 minutes.

There were two missions. Using a drone manufactured by NeonTech, lunch boxes and beverages were delivered to guests at a pension located 1.3 km from the gas station, and using an XDrone drone, snacks were delivered to elementary school students at Haean Elementary School, 0.8 km away. Currently, GS convenience store delivery requires users to order products via the app and then visit the store to pick them up. Once drone delivery services are commercialized, customers will be able to order products through the app, which will then be loaded onto drones at nearby GS Caltex gas stations and delivered to the destination.

◆Government Supports 18 Billion KRW for Drone Delivery in Remote Islands and Mountainous Areas= This is part of the 'Drone Utilization Service Market Creation Support Project,' jointly promoted by the government and private sector since last year. The project aims to enhance the reliability of drone services and support and nurture companies through the development and demonstration of drone service models. This demonstration tested the establishment of a highly reliable drone logistics service platform with a delivery mission success rate of over 98%, in collaboration with GS.

In particular, the government is conducting demonstration projects focusing on remote islands and mountainous areas to accelerate the early commercialization of drone delivery services amid increasing demand for untact services to prevent the spread of COVID-19. A total of 18 billion KRW in national funds will be invested by 2022. The pilot operation areas will increase from four this year to ten by 2022. The scope of application will gradually expand from remote islands and mountainous areas to suburban and then urban areas.

An official from the Ministry of Trade, Industry and Energy stated, "Drone delivery services in remote islands and mountainous areas can quickly deliver daily necessities and safety supplies. It is expected to be a great help to elderly and residents living in logistics blind spots."

If regulatory difficulties arise during the commercialization of distribution and logistics delivery by private companies, rapid business promotion will be supported through systems such as the regulatory sandbox. The regulatory sandbox system resolves regulatory obstacles and supports market entry for new industrial convergence products and services through rapid regulatory confirmation, demonstration exceptions, and temporary permits.

◆GS Declares Entry into Drone-Based Distribution and Logistics Services= Amidst the government's and private sector's accelerated development of drone delivery systems, GS Caltex and GS Retail declared their entry into the drone-based distribution and logistics service sector for the first time among domestic companies. They presented a vision to utilize their nationwide gas station network as drone delivery and future mobility hubs.

GS Caltex plans to collaborate with logistics companies to commercialize drone delivery businesses based at gas stations and to explore ways to expand drone delivery hubs using the networks of affiliates such as GS Retail, thereby enhancing synergy among affiliates. They aspire to promote a 'Mobility & Logistics Hub' business that provides not only mobility services such as car sharing and electric/hydrogen vehicle charging but also logistics services including parcel and drone delivery.

President Huh said, "Gas stations are suitable as logistics hubs because they allow easy access for logistics vehicles, have ample loading space, and are distributed nationwide. We will continue to develop various logistics services utilizing gas stations, including drone delivery."

An official from the Ministry of Trade, Industry and Energy commented, "The commercialization and expansion of drone-based distribution services in the untact era are expected to increase in importance and utilization. The government will promote the development of new technologies such as source drones with increased flight distance and payload capacity, and will also consider linking electric/hydrogen charging and gas station networks with future mobility."