The FAA forecast says that the drone market will see explosive growth, driven by “an improved regulatory environment” and growing demand. The FAA seems to take credit for industry growth, despite frequent complaints from the drone industry that slow and complex regulation is suppressing innovation and forcing larger players out of the country. “In 2015, unprecedented milestones were achieved for UAS,” the report states. “The FAA is continuing to enable this new thriving industry to flourish while maintaining safety.”
The FAA has granted over 4,000 Section 333 Exemptions for commercial drone operations, and says that this is an indication of the high demand for drone applications. The report predicts that sales of commercial small drones could exceed 600,000 for 2016 and grow to 2.7 million by 2020.
The forecast says that the final rule on the Operation and Certification of Small Unmanned Aircraft Systems will be released later this spring, and commercial drone sales are expected to fall into distinct categories by size after the release: FAA predicts that smaller drones will dominate the market as regulations evolve to make them a better choice.
… it is expected that, once the final small UAS rule is implemented, two different categories of small UAS (sUAS) will emerge. Higher end sUAS will have an average sales price of $40,000 per unit, while lower end units will have an average price of $2,500. Over a five year period, Teal Group forecasts the sUAS fleet to be approximately 542,500.
Of this estimated fleet, it is expected that roughly 90% of the demand will satisfied by the lower end units…The number of small UAS forecasted is highly uncertain and is dependent on the regulatory structure ultimately adopted. Once a final rule for small UAS is published, they will become more commercially viable than they are today.
The report also specifically mentions the possibility of BVLOS operations, as well as operations of multiple drones by one operator. Both of these measures, currently not allowed, would enable broad scale commercial applications such as drone delivery. After heavy lobbying efforts from Amazon and other industry leaders, the latest Senate proposal for FAA Reauthorization specified that BVLOS flight must be a priority for the FAA. In this report, the FAA says that they are investigating the issue, and admits that it will have a significant impact on the industry: “The overall demand for commercial UAS will soar once regulations more easily enable beyond visual line of sight (BVLOS) operations and operations of multiple UA by a single pilot. Once a framework is enabled for BVLOS operations, the projected market sizes could be higher than the forecast.”
Hobby drones were also mentioned in the forecast, which predicts 1.9 million potential annual sales, possibly increasing to annual sales of 4.3 million units by 2020.
The FAA acknowledges that the drone industry cannot be ignored, and may offer a significant impact on the economy:
Venture capitalists are already investing considerable amounts of money into this emerging industry with the intention to build early market share in this technology. Manufacturers’ efforts are focused on build- ing systems optimized for particular segments of the market. Unmanned aircraft systems will be the most dynamic growth sector within aviation. The FAA will continue to work with industry and stakeholders to safely integrate UAS into the NAS.
Miriam McNabb is the Editor-in-Chief of DRONELIFE and CEO of JobForDrones, a professional drone services marketplace, and a fascinated observer of the emerging drone industry and the regulatory environment for drones. Miriam has penned over 3,000 articles focused on the commercial drone space and is an international speaker and recognized figure in the industry. Miriam has a degree from the University of Chicago and over 20 years of experience in high tech sales and marketing for new technologies.
For drone industry consulting or writing, Email Miriam.
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