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The Future of Last Mile Deliveries

A new report by Savills looks at how new delivery technologies, such as drones, truck platooning and Hyperloops could impact real estate in the years to come.

Kevin Mofid, head of Savills UK logistics and industrial research, says that the question of where to locate a warehouse has historically been a trade-off between local road transport networks, where product comes into a country, the retail and manufacturing final destinations and the availability of land.

However, Mofid adds: “As technology begins to transform how goods are distributed, operators’ locational decisions may change. The onset of Covid-19 has the potential to accelerate some of these locational decisions as online shopping rates increase around the world and retailers and manufacturers realise their supply chains have been too lean and therefore need to move inventory closer to its final destinations.”

The prospect of vehicle automation, high-speed Hyperloop capsule delivery and airborne drone transport means that logistics companies and their partners must reconsider where to locate distribution centres and how to build them.

“If the future of last mile logistics is drone delivery and autonomous vehicles, then the future is almost here,” says Michael Fenton, national head of industrial and logistics at Savills Australia and New Zealand.

Below is a summary of each of the three sectors that could have a major influence on last mile deliveries in the near future.

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