AVL's Reimagine Mobility Podcast

Future of Drones in Logistics w/ Frank Noppel

• AVL, North America

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Join us in this enlightening episode of the Reimagine Mobility podcast as we dive into the transformative world of drone logistics with Frank Noppel, CEO of Blueflite. Discover how drones are revolutionizing delivery systems, offering faster, cost-effective, and eco-friendly solutions. Frank discusses the technological advancements, regulatory environments, and the potential for drones in sectors like healthcare and industrial services. Learn about the challenges, solutions, and future prospects of drone logistics in this comprehensive discussion.

 

Frank is the CEO of Blueflite, a company solving the modern-day challenges in the logistics industry. Blueflite offers a unique platform featuring aerial delivery robots which enable significantly faster deliveries at a much lower cost compared to conventional transport. The Blueflite logistics solution allows for integration into an all-automated supply chain to for high-speed deliveries at scale. Frank is a serial entrepreneur with a PhD in aeronautical engineering from Cranfield University, and has also gained experience in the corporate world when he worked at McKinsey & Company as strategy consultant.

 

Blueflite is designing and manufacturing an advanced cargo drone platform to solve the modern-day challenges in the logistics industry. Blueflite’s drones offer faster deliveries at a lower cost compared to conventional transport. The unique and patented design features vectored thrust and machine learning software, giving it unrivaled maneuverability and the ability to reliably operate in any weather. The platform allows for complete digital integration through blueDigital, the company’s drone operations software. It facilitates an all-automated supply chain for high-speed deliveries at scale.

If you would like to be a guest on the show contact: namarketing@avl.com

Welcome everyone, to the latest edition of the Reimagine Mobility podcast series. I'm here with Frank noble from Blue Flight. Frank. You guys are in a space that definitely is redefining mobility. Definitely perfect for this podcast. What we want to talk about, how we reimagine mobility. So maybe if you could, Frank, introduce yourselves, introduce what you guys are doing, what your vision is, and then let's jump in together. And I'm going to ask you a lot of questions and how to gather here. We reimagine mobility. Sounds good. well, thanks for having me. My name is Frank knuckle, chief executive and co-founder of Blue Flight. based here in Brighton, Michigan. the vision is, that we believe drones will make a significant difference in the logistics sector. they offer much faster transport at a much lower cost than what is possible on the ground, which is, a very, attractive proposition to anybody who is in the logistics space. And there are secondary factors, like, much better access, no dependency on road infrastructure, running all electric without emissions, and so on. So looking forward to the conversation and your questions. Very good. So let's jump right in. Let's define drones a little bit here, Frank, because I think some people may think yeah yeah this is the stuff Amazon's been talking about where my package, my new cells for my new Mog, my new backpack is going to be delivered by a drone. Other people may talk about now we're serious. We're talking about larger crates, larger packages, things that may have to go from land to a, offshore boat. an offshore drilling site, a yard, and difficult to get to a remote site in the mountains. Define a little bit. And I'm sure it's not all of it, but define a little bit where you guys are in and what you guys discuss or mean with a drone. Yeah. So that's a fair point. so you could, structure the drone space by the size of the drone. It's probably the easiest and the easiest to comprehend. there is a, a point defined by regulation where the small drones and the large drones are being separated, and that is measured in, in weight and weight class. that's 55 pounds or 25kg total total system weight. So we stay right at the mark. which puts us on the larger end of the small category. it allows us to transport cargo in the range of 5 to 10 pounds. I say the range because there is, offset between the distance the drone can travel and the amount of cargo it carries. At the current technology level, we're talking about, 30 miles, 40 miles, maybe 50 miles of range. at the payload that I just mentioned. And this is just this is assuming it runs on battery, right? so to define the drone, in your words, it's, it's a logistics drone carrying 5 to 10 pounds. with distances typically 30 to 50 miles, running all electric, no emissions. And I think the important point to highlight, because there are many drone companies and then we often get the question, you know, why isn't blue flight? And I think the answer is very simple, because our drone was designed for the logistics use case. You cannot repurpose a drone that was designed for a different application and then expect it to work for logistics. you don't buy your race car and, refurbish it and use it for your deliveries, right? So it has to be optimized and, and custom designed for the delivery application. And that's our strengths. We have a patent on it. we cover the hardware and the software aspect. And we also focus on being the tech provider. So in the drone space we do not operate the drones. I think the best analogy is, an airline and an aircraft manufacturer. so we are the equivalent of the manufacturer, and our customers are the equivalent of the airlines in the drone space. And, and that's a very conscious decision. and, that's how we operate as a business. And then, Frank, maybe the next question then is when I look outside, sometimes I have neighbors that use a drone. Okay. And you see drone sometimes when you go to the beach and then people take pictures, videos, etc., their remote control is, is the drones. You guys are again, as a manufacturer, provide to the operators remote controlled. Is it remote controlled up to a certain degree, but then also has capability of driving autonomously and come back to where it was sent from. Highlight a little bit. Maybe what we're seeing in that space is the relation of the propulsion system or the range, but also the operations of it. Yeah. So that's important. That's very important actually. and the reason why this is an important topic is the unit economics. Right. the most expensive part of any drone operation right now is actually the people flying it. And the way you described it with the neighbor in the backyard is you have a remote control unit that connects to the drone, and then that person will fly the drone, you know, from a point A to point B, and in a commercial setting, this is the salary you need to pay to that drone. Operator. Right. And in the greater scheme of things, that's where you would have the highest cost. So it's in the best interest of the drone operator to have this drone run as autonomous as possible. And ideally, you have many drones operated simultaneously by one person, And ideally, you have many drones operated simultaneously by one person, to, to bring down this cost. And obviously that is something we are aware of. And is something where we design and develop our technology to have the highest level of autonomy going forward, because that defines the unit economics and the ability to roll out drones at scale and we're already at a level where we can program the autopilot through a very, straightforward interface to for this drone to run a certain mission that typically involves, a take off, location and then flying to a specified point, where the cargo is delivered and then returning to the point of origin. and that's the most simple way of operating a drone. But there's more complex, operations like the drone flying empty to a specified location, picking up a package and then delivering it somewhere else. so there's different layers of complexity, and, each layer of complexity has different, requirements on the level of autonomy. So, I think the starting point is to keep it simple and move up. And the level of complexity as technology and regulation and market acceptance, matures. and market acceptance, matures. So it's really, really similar then to what we talk in the, in the mobility space, on the ground mobility space for autonomous vehicles on sort of tele-operated or supported autonomous vehicles driving right where you also have one operator sort of monitoring several different vehicles. And when or if they get stuck, they they can jump in and how very interesting. So you're talking a little bit about again, it's a battery powered system. We talked before about range. So every time in the automotive space at least it's about range. And how long does it take to to refuel or recharge. What do we see here with a drone when it comes back after it delivered. Or it makes a pitstop somewhere else? Does it need to recharge? And if so, again, depending on range, we know that. But if it let's say it's fully empty, more or less. What are we talking about from, from a recharging point of view. How much time is that? Yeah. So that's that's also a fair point. And, it's a it's a topic that's a little out of our hands because we rely on the technology that's provided to us by the battery manufacturer. so at the current level of battery technology, you know, mind you, there is but big improvements happening in the battery space. But the flight time and these are sort of average numbers, but you can expect about half an hour of operation out of a single battery charge. if you carry less payload or slightly slower, you know that, then maybe you get more, and to read and to recharge the battery, it takes roughly the same amount of time. And, and it's, it's, it's more down to how powerful your charger is. Right. So if you have a fast charger, you can do it the less time. if you have a more standard charger, then it will take a little more time. But I would expect you will not cross the one hour. It will stay well below. and there's two ways to recharge the battery. It's either you keep the battery on board the drone, and you have an external plug, and you plug in your charger equipment. and the second option is the faster one where you manually, take the old battery out and put a fresh one in and then fly with the fresh one, and the old one goes on the charging rack. And, I think here our approach is to offer both possibilities to our customers because they may have different needs and, certain customers will accept a rotation time or a charging cycle between the flights. And other customers may want, faster turnaround and therefore want to swap the battery. So I think it's important that we have the flexibility and we've built it in our system. And and both options are possible. To elaborate and I'm going maybe above your question here. There are different energy carriers than batteries as well. That are interesting for droughts. Which would be hydrogen for example air or gasoline or elaborate on that I and that's an interesting point. So both is the short answer. hydrogen has a huge advantage. It stores a lot of energy in in a relatively small volume and extremely light substance. So hydrogen weighs close to nothing. I mean, we know that lighter than air ships back in the day. So we're all flying on hydrogen. So it's a very light, substance, but stores a lot of energy, a lot more. The battery from. But you need a converter, so you need to somehow get this energy extracted from the hydrogen and then turn it into electric power so that you propel your, your, your device and, feed the electricity to your, to your motors. And there is already tech in place. There's different approaches, and they're now nearing a level of maturity where it becomes an attractive alternative. And it's not a question of whether it works. It's really more a question of where does the origin come from? If you were to run your drone and hydrogen? now the big advantage of hydrogen is the, the additional power allows you to fly much wider range. Right. so maybe to trade simplicity in operation, because handling a battery is still probably easier than handling hydrogen. But if you wanted to fly over much more distance, then hydrogen becomes a very attractive alternative. if you want to keep the drone at a reasonable size, in our payload spectrum, and then second to hydrogen, like you alluded to, it's also a fossil fuel power plant that converts, through a generator. the chemical, chemical and energy in the, in the petrol into power, an electric power that's fed to the motors. And it's something that we don't see much interest. And we haven't pursued that path. because I think the the world is trying to get rid of, petrol and, I think the starting and drones offer this possibility. So, we don't see much happening on that side to balance. Let's jump into a slightly different area. You're alluded to a little bit regulations, right? I mean, some people I've read about drones, you know, are worried that whatever in 5 or 10 years, all we going to see is not the sun or the blue sky anymore. Are we going to see drones flying left and right across everywhere? Can you allude a little bit what what do we expect as we look forward and again, as we reimagine mobility in this, in this transportation space here? Is there a lot of regulation already is. There's a lot of questions by the regulators. I don't know if the FAA is involved here or what, but shed a little bit of light on that space. Please. Yeah. so when we talk regulation, it becomes pretty complex and global. And there there are a lot of countries and everybody has a slightly different approach to regulation. But what we can say on a global level is that regulation is becoming and advancing, a lot more drone friendly. I think the regulators worldwide are recognizing the potential that drone can make to to the economy. And we're talking about delivery drones, but not exclusive. Read this. Other types of drones that have different applications. so regulation is advancing a, at a pretty, fast pace, towards enabling adoption or use of drones at scale. Now, if we double click on the the U.S., then obviously there is one regulator, it's the FAA. And they started looking into drones many years ago. Right. Said drones are already flying. Drones are already flying for cargo delivery, by multiple operators. And it's not a question of whether it's possible. It's a question of how much effort is required to get there. For somebody who wants to get into the business of delivering by drone. And there are programs by the FAA and different approaches to use drones commercially. And, at the highest level, it's becoming easier and easier with less and less paperwork and, and, obstacles involved. Right. And we can go into the more detail. I don't know if we have enough time for that. but there are frameworks being developed that streamline the process significantly, and there are that's already being rolled out. And there's more to come for sure. Frank, let's talk a little bit about short term and long term of the logistics space for drones. What do you see short term I think you've you've talked already a little bit about that. We have an idea. I think the some of the use cases you already mentioned, but maybe you have something to add there. But what do we then also see long term and long term, I mean, between 5 and 10 years out. Right. Short term is more between now or in a year from now to five years from now. And then the next is what do we see? What do we see by 2030. Yeah. So I think there's three factors that, that you need to consider. The first is the technology. So what's available. And what's the unit economics or laws. The second is what is possible from a regulatory point of view. And the third that I think people tend to forget this. What is, accepted by the market, right, in terms of, the use cases that are pursued, by, by these various players. So let's start with the first one, which is down to tech. from a tech point of view, we're really starting to mature. And I think it's less of a question of what is possible. It's more of how much does it cost, right. And because of the other factors, like regulation, or where we, you see the applications of drones, the use of drones in logistics tends to be more geared towards where urgency is, is coming in or coming in as a factor. So, in other words, where you have a high level of urgency attached to the delivery, because then the propensity to pay for a service to, to use drones is much higher. And, we see that happening in the health care sector, because, you know, most likely when you mean to move something in the health care sector, there is a level of urgency attached. And, that could be medical devices or medicines or test specimens to laboratories, etc.. So there again, there's a lot of subsets of applications in health care. But I think health care in general is an industry that sees the adoption of drones at at a high pace and is very attractive. second to that is, I would just frame it as sort of the industrial use cases. And again, there's many, many subsets, but that alludes to what you just said, like, maybe and going to offshore locations and maritime, settings, to deliver stuff to, to ships. And maybe it's less about the urgency, but the alternative mode of transport. So if you go to a ship, you need to go by dinghy or, you know, whatever is required. It's it's expensive, but the drone can do the same job at a much lower cost. And there are safety aspects, as well, that often play a role. And I think the third area that we see building momentum a lot momentum. And this is down to how tech and regulations changing is on the last mile. logistics on the consumer side. you know, this could be e-commerce. this could be, your daily shopping, etc.. And, I think there's, there's a lot happening in that space. And, as the, the unit economics become more attractive, the adoption of those use cases is accelerating as well. Okay. Very good. In the in the automotive space, if I take a slightly different angle to what we've just talked about in the automotive space over the last five, maybe even ten years, for sure, maybe even longer before that. Cyber security has become a much, much bigger issue. Right. And it's it's I think on the one side about the safety of the vehicle, it's on the other side about the economic benefits somebody could gain from being able to totally disable all vehicles of a particular brand. I would assume not knowing. But again, looking to you that in the drone space you have a similar issue, but we also have an issue of using these drones for the purpose of potentially hurting people by whatever means or caring or something. Again, maybe I've seen too many sci fi movies or whatever, but, really, the topic here cybersecurity. How big of a topic is this, Frank, in your space? No, it's a big topic. and it's a very important topic. So at the first level, there's different ways of encrypting any communication with the drone. And and this is typically handled through mobile networks, satcom and there's different ways to do that. And the level of encryption is already very high in the signal flow. So the question is more about secondary levels of encryption, where we can fall back to two factor authentication and very, you know, common processes and that with each layer and hence the, the, the level of security with, with respect to accessing a system, I so it's taken very seriously. And there's a lot of tools and technologies in place that can maximize it. And I think on top of that goes back to the first point, to what level, is the drone required to operate autonomously, because once it operates autonomously, then it doesn't require access through potentially, well, threats in the security system because you don't need data flow between a ground station and, and the drone. And then it's more difficult to intercept. and so we're pushing the boundaries on, on all three topics and to constantly developing and working with our partners and suppliers, to put the safest systems in place. And, a lot of them are already based on what's available and proven. And now we're looking at what else is possible on top, to, to make this even safer. Right. And there are systems being used in the aerospace sector already. and they exhibit or they carry already a lot of layers of security, with existing systems that that we can fall back on. So two more questions. One for me, a an interesting point that, when we look at drones, right, we oftentimes, at least again in my neighborhood, I see them fly in great weather. I'm sure logistics type applications, they can't just only fly in in good weather. They have to fly in high winds and maybe snow. Rain, fog. Tell me a little bit about that. Does that mean that again, we have different drones for different applications because some drones still want to be quote unquote penalized with, slew of additional sensors to be able to have them fly in the worst of weathers yet, then they're heavier in good weather, they would fly less far because of more weight. Can you shed a little bit of light on that? in the in that space? Yeah. No, that's that's a another very important factor which comes down to how reliable is your system. And reliability is a very important topic in logistics because any logistics operator and in the end it's the end beneficiaries, want a seamless service and one technology that works irrespective of what the weather is like you, if you're waiting for an urgent delivery and the feedback is, oh, sorry, it's raining today, we can't fly, then this is not acceptable, right? so we, as the drone manufacturer and design company, put a lot of focus on on ensuring the highest levels of reliability in our system. And this comes from what I said in the very beginning. most of the drone systems, but specifically the ones that were not designed for logistics, they don't have that built in right limitations with regards to precipitation, temperature went, etc.. so to bring this level of reliability up, where it is accepted by logistics operators, you really need to think outside the box and solve these challenges through engineering. and, and I think that's where we as a drone OEM stand out, that we have a system that addresses all these all these challenges. And, you know, that's why our design is very different. We have a patent on it. and, stands out over what else is available in the market. And then last question, nothing to do with drones. what's the next car you're going to buy and why? well, I'm more of an an aerospace guy and not a another car person. I wasn't prepared for this question, but my natural inclination would be I'm probably currently driving my last petrol car and the next one will be electric. All right. Very good. So if you could, you would take a drone or a helicopter to work, if that possible. Yes. I mean, I'm a private pilot, so I do sometimes fly if I get the opportunity, which doesn't happen very often anymore. and so going by the air has certain advantages. it's much faster. it's if if the weather is good can be a lot more pleasant. and, you know, I hope that in our lifetimes, we see airborne transport becoming a, a major means of transport, whether it's with or without people aboard. So. Absolutely, absolutely. Thank you so much, Frank, for your time today and for introducing us to drones. And the largest risks to introducing us to your company, Blue Light. Congratulations to some of your recent, financial awards. certainly. a great thumbs up for what you guys are doing. And again, congratulations and good luck going forward.