- Amazon is reportedly laying off dozens of R&D and manufacturing staff working on its delivery drone service Amazon Prime Air, according to a Financial Times report.
- The company is turning to two external manufacturers to build components for the drones, with additional deals potentially in the pipeline, a person familiar with Amazon's plans told the paper.
- Amazon's drone deliveries are still "years away," but development will "slowly but surely" progress in 2021, the person said.
- Amazon Prime Air service, which has been in the works since 2013, received permission from the Federal Aviation Administration to start conducting delivery drone operations in August.
Amazon is reportedly laying off dozens of staff working on its delivery drone project, Amazon Prime Air, turning to external manufacturers to help build the devices instead.
The jobs would be lost in research and development as well as in manufacturing, the Financial Times reported Thursday, citing a person familiar with Amazon's plans.
The online retail giant has reached tentative deals with Spain's Aernnova Aerospace and Austria's FACC Aerospace to manufacture component parts of its drone, the FT reported.
Transform talent with learning that worksCapability development is critical for businesses who want to push the envelope of innovation.Discover how business leaders are strategizing around building talent capabilities and empowering employee transformation.Know More Amazon plans to use electric drones to deliver packages weighing up to five pounds in under 30 minutes. The service has been in the works since 2013.
A person familiar with the matter told the paper that the full terms of the agreements were still being finalized.
Amazon had sent out a "request for proposal" to multiple companies over the past year, meaning additional deals with third parties could also be reached soon, the person said.
Seven years since the project was first unveiled, Amazon's drone deliveries are still "years away," the person said, but development will "slowly but surely" progress at the start of next year.
Business Insider has contacted Amazon for comment.
The two external manufacturers in question, Aernnova and FACC, specialise in the manufacturing of aircraft components for the aviation industry. Some of their clients include Airbus, Boeing, and Bombardier.
Read more: Amazon is aggressively underpricing grocery competitors like Walmart and Target amid the pandemic, in a bid to capture the huge shift to online buying
Aernnova and FACC did not immediately respond to a request for comment.
Amazon received permission from the Federal Aviation Administration (FAA) to begin testing drone deliveries in June 2019.
In August, the FAA issued Amazon permission to start conducting drone deliveries.
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