Where Is the Drone Industry Headed? DroneII Report Finds Drone Services Growing Strong + Other Key Predictions
BY Zacc Dukowitz27 September 2023
Drone Industry Insights (DroneII) recently put out its 2023 drone market report, and there are some surprising predictions found inside.
The report runs 227 pages, sharing findings from its research and laying out forecasts for the next seven years for different segments of the drone industry.
The full report costs $5,499 Euros, but DroneII has shared some of the key findings.
Keep reading for DroneII’s top seven predictions about where the drone industry is headed.
1. Drone Services Dominate the Market
Comparing market share segments between hardware, software, and drone services, the latter has 80.1%. That is a massive majority.
That data reflects the current breakdown for 2023—and that trend is set to continue.
According to DroneII, the drone services sector is on track to grow at a solid rate of 9.2% CAGR. (CAGR stands for the compound annual growth rate and is used to measure the average rate of growth over time.)
Drone hardware is also projected to grow at a solid rate of 9.3%. But the overall breakdown of market share isn’t projected to change, which means that drone services will continue to dominate.
If you’re a commercial drone pilot, this is great news. The projections show that not only will you have work today, but that demand for your work will continue to grow over the next seven years.
2. The Commercial Drone Market Will Grow at a Steady Rate
Another big takeaway from DroneII’s report is that the commercial drone market is set to grow at a steady pace.
According to the report, between now and 2030 the commercial drone market will grow at a rate of 7.1% CAGR. At that rate, DroneII projects that the overall value of the commercial drone market will reach $54.6 billion by 2030 (as shown in the chart above).
This isn’t that surprising, given that we’ve seen drone adoption growing for commercial uses over the last several years.
From inspections to surveying to drone delivery, drones are seeing more and more adoption as tools for commercial work. And with that adoption has come greater specialization, with higher price points and more sophisticated technology created to support specific types of industries and applications.
But it’s important to note that this projection is for less growth than past reports have predicted.
DroneII’s 2021 report projected that the commercial drone market would be worth almost $43 billion by 2025—now it’s projecting it will be worth $38.6 billion.
3. The Consumer Drone Market Has Reached Its Peak
Another key finding in the report is that the consumer drone market will essentially “remain stagnant” with a CAGR of -.03%.
Maybe Skydio knew this when it recently decided to exit consumer drone sales, essentially ceding control of the consumer market to DJI.
The Skydio 2+ | Credit: Skydioua
Despite Skydio’s exit and the lack of real competition, we did find DroneII’s projection surprising. We would have imagined there would be some kind of growth in the consumer market, especially given how relatively young it is, with lower prices and better technology lowering the barrier to entry.
But it looks like the consumer drone market may have already hit its peak.
4. Drone Delivery Has a Strong Future
Drone delivery makes the news a lot. But is it actually on track to grow?
The answer is yes, according to DroneII’s reporting, which finds that the CAGR for drone delivery is 13.9%.
We should clarify that this growth rate is specifically for drone deliveries as an application method, which means the use of drones to deliver goods. It is not a number representing the manufacture of delivery drones, like DJI’s new FlyCart 30.
Here are the sectors where DII projects the most growth for drone delivery in the next seven years:
- Logistics (e.g., packages and food)
- Emergency services (e.g., defibrillators and life vests)
- Healthcare (e.g., vaccines and samples)
5. Asia Will Lead the Commercial Drone Market
According to DroneII’s report, the commercial drone market is currently led by Asia, thanks to the production happening in China and Japan.
And it looks like Asia will continue to lead the globe in the commercial drone market in coming years, despite efforts in the U.S. to grow our domestic supply chain and prop up American drone production.
Not too far behind Asia is the Middle East and Africa (MEA), which has been growing rapidly in the commercial drone sector. MEA has a projected CAGR of 15.4%—more than double that of the commercial drone market in general.
6. Warehouse Drones Are Growing the Fastest
A part of the drone industry that many of us may not think about too often is actually poised to grow the most of any drone application.
According to DroneII’s report, the use of drones in Cargo, Courier, and Warehousing is currently the most rapidly growing, and will continue to grow faster than any other, at a CAGR of 15.7%.
Although not the flashiest use of drones, it isn’t surprising that automating warehouse inventories and logistics is one of the leading use cases for drone technology.
Any time you find a use case in which drones can do the work faster and more efficiently, in a manner that is highly scalable, growth is sure to follow—and all of these apply in using drones for warehouse logistics.
7. Drone Mapping and Surveying Is the Top Drone Application
Finally, DroneII’s report found that Mapping and Surveying “is and will remain the top drone application.”
Drone Mapping and Surveying is currently worth $10 billion globally for 2023. After that application, the other top drone applications are Inspections and Photography & Filming.