There comes a point in time when individuals and companies must face the facts and accept reality.
Amazon, for example, has been touting since 2013 that they would become the leader in delivering packages that weighed five pounds or less via drones. Amazon isn’t close to achieving their goal.
According to CNBC, Amazon has suffered a significant setback to its drone program as it lost two crucial executives who played pivotal roles in the company’s drone delivery operations – Jim Mullin, the former chief pilot of Prime Air, and Robert Dreer, who was responsible for overseeing all of Prime Air’s test operations – have left the company.
Despite receiving millions in funding, Amazon Prime Air is only testing drones in two small markets, and the program has been plagued by drone crashes and poor drone performance.
I have been a critic of Amazon’s drone program from the beginning because I don’t believe drones will benefit Amazon accept in a few limited use cases. I certainly understand why people at Amazon got excited about using drones. Yes, they’re cool and fun to fly. They’re also a nightmare of regulations.
I remain convinced that Amazon should immediately shut down their drone program. In a year or two, Amazon can assess the market to see which drone company has achieved all regulatory approvals and is also successfully delivering packages. If there is a business case for using drones, Amazon can easily acquire a leading drone company.
Some may argue that Amazon should keep their drone program and increase the funding. I disagree. Drones are a distraction to Amazon and little progress has been made. Andy Jassy needs to make it clear that enough is enough and that there are more important priorities for Prime Air and Amazon.
Instead of funding a program for drones, I’d prefer that Andy Jassy assemble and fund a team to answer these questions:
1. If Amazon enters commercial aviation, what could Amazon achieve in 10 years?
2. Should Amazon have Rivian create a separate company – Rivian Commercial – to focus on vans and electric semi trucks? If yes, should Amazon acquire the company?
3. Whole Foods shoppers go to Walmart, Kroger, etc., to buy popular CPG products sold in their stores. Why don’t we keep those customers shopping at Amazon? Why do we let our competitors take our customers? What is our CPG strategy for Whole Foods?
4. Do we fully understand the potential threats from TikTok, Shein, and Temu? Show me the data.
5. Walmart generates 60% of their revenue selling groceries and they control 25% of the grocery market. Tell me again how Amazon Fresh will change that.
6. Why isn’t our 3PL business growing faster?
8. How can we leverage the science of auctions to our benefit?