Meituan launches drone delivery service in Dubai, aiming to revolutionize last-mile logistics

Photo: X (@DXBMediaOffice)

Meituan is venturing beyond its home market of China, with its drone delivery service leading the way. Interestingly, its first international drone market isn’t Saudi Arabia—where it initially launched food delivery operations—but Dubai, a vibrant hub in the United Arab Emirates. Operating under the name “Keeta Drone,” Meituan’s drone division has evolved from a pilot project into a standalone business, spearheaded by Vice President Mao Yinian. The company has established a dedicated team in Dubai and scaled up its production and research capacities to support this initiative.

In Dubai, Keeta Drone collaborates with restaurant chains to offer delivery services in specific areas like the Rochester Institute of Technology (RIT) campus and Dubai Digital Park (DDP). The company plans to expand into pharmaceutical deliveries with local hospitals, aiming to eventually include food, groceries, and medicine in its operations. Dubai’s supportive drone policies played a key role in Meituan’s decision to enter the region, with the company identifying the Middle East as a strategic market after the 2023 Lunar New Year. An internal source highlighted the importance of regulatory openness, which made Dubai’s policy environment particularly attractive.

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In May 2023, Mao conducted field research in the UAE, setting the stage for Meituan’s participation in the GITEX Global event in October. Despite challenges posed by dense urban environments and complex permitting processes, the company successfully demonstrated its drone technology with a test flight during the event. This marked a major milestone, as it was the first time drones operated in populated areas of Dubai. On December 17, Keeta Drone secured a license from Dubai’s Civil Aviation Authority (DCAA) for beyond visual line of sight (BVLOS) operations, making it the first company in the region to achieve this milestone. Insiders revealed that Mao visited Dubai multiple times in 2024 to ensure the initiative’s success.

Drone delivery is a vital part of Meituan’s larger strategy, offering an innovative solution for last-mile logistics. In China, the company’s drones have established 53 routes in cities such as Beijing, Shenzhen, Shanghai, and Guangzhou, completing over 400,000 orders by December 2024. However, with an average of 1,000 daily orders, the service is still in its early stages, leaving significant potential for growth. Challenges like regulatory restrictions, infrastructure limitations, high costs, and inefficiencies in last-mile logistics continue to hinder widespread adoption. Addressing these barriers will require reducing costs and expanding use cases.

The Middle East offers unique advantages for drone delivery. Harsh summer temperatures often limit traditional delivery methods, while fragmented urban layouts and road infrastructure add logistical complexity. Dubai’s artificial islands and limited road access further highlight the efficiency of drones, which can traverse short distances through the air without lengthy detours. The UAE’s proactive policies, such as the “Dubai Program to Enable Drone Transportation” and the BVLOS Drone Delivery Program, have created a supportive environment for drone logistics, making it a logical choice over Saudi Arabia.

Keeta Drone’s model integrates with Meituan’s broader vision of leveraging hubs for drone takeoffs, landings, and automated delivery lockers. Although this system currently offers less convenience than doorstep delivery, ongoing technological advancements are expected to enhance scalability and flexibility. In Dubai, similar automated hubs are being tested to refine efficiency, with insiders reporting year-over-year cost reductions. Meituan projects that drone delivery costs will eventually align with those of ground-based methods within three to five years, provided technology and operational improvements continue.

High labor costs in the Middle East present an additional advantage for drone operations, potentially improving profitability compared to China. For now, Keeta Drone is focused on testing, learning, and refining its approach. Leveraging drones for complex terrains and urban bottlenecks will be critical to unlocking growth. While commercial success remains a long-term goal, Meituan is committed to adapting and innovating, paving the way for the future of logistics both in the Middle East and beyond.

Dec. 18, 2024 3:26 p.m. 369

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