The race for drone delivery is intensifying — Walmart Inc WMT announced Monday it's entering into a partnership with medical product delivery company Zipline.
What Happened: Walmart claimed in a statement that it would be a first of its kind on-demand drone delivery operation in the United States, and is expected to kick off next year.
The pilot tests will be conducted by delivering select health and wellness products in Arkansas. If successful, the new system could be later extended to general merchandise as well.
Zipline will handle the deliveries from a Walmart store to service orders within a 50-mile radius. Not only will this reduce the delivery timeframe to less than an hour, the move could also have a positive environmental impact due to the lack of carbon emissions.
Why Does It Matter: Last week, Walmart announced its partnership with Flytrex to conduct drone deliveries in North Carolina for essential household products. Reportedly, Flytrex drones can operate within a 60-mile radius from the retail stores and could engage more than 15 deliveries in an hour.
Walmart and Amazon Inc AMZN are both competing to launch a functional drone-based delivery model. Amazon received the U.S. Federation of Aviation Administration approval for its Prime Air service in August.
Price Movement: Walmart shares traded 0.25% lower at $136.36 in the pre-market session Monday.
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