Delivery by rocket could change the game for UPS, FedEx

Airplanes in addition to also Panamax cargo ships redefined the parcel service from the 20th century, yet those days may be fading quickly.

Morgan Stanley believes the SpaceX plan for the Big Falcon Rocket as a reusable mode of Earth transportation could change the game for United Parcel Services in addition to also FedEx.

“The freight transportation business — especially parcel delivery — is usually on the cusp of transformation by multiple brand-new transportation modalities,” a team of Morgan Stanley analysts wrote in a note Thursday. “Elon Musk recently announced a brand-new option that will could potentially develop the biggest impact of all — rockets.”

The booster system BFR is usually a 42-engine rocketcapable of holding around 100 people – in addition to also yes, the code name connotes more than just “Falcon” to those inside SpaceX. having a payload capacity of 150 tons, BFR would certainly be nearly 10 times the capacity of the flight-proven Falcon 9 rocket in addition to also 5 times that will of the soon-to-be-tested Falcon Heavy rocket.

SpaceX wants to use BFR to land two cargo ships on Mars by 2022, establishing a human presence two years later. yet Musk also announced that will the technology could be used to speed up transportation on Earth, an idea Morgan Stanley says could have serious shipping implications.

“If you build a ship that will’s capable of going to Mars, what if you take that will same ship in addition to also use This specific to go by place to place on Earth,” Musk said on Sept. 29, showing a promotional video of a rocket taking passengers by brand-new York to Shanghai in 30 minutes.

The parcel service “industry could see a fundamental reset with the introduction of rockets as a transportation modality,” Morgan Stanley said.

The firm noted that will parcel service portion of the freight transportation market is usually “the most obvious in addition to also effective application” of rockets. Morgan Stanley says parcel delivery is usually a service characterized by slow, GDP-like growth of 2 to 3 percent per year.

Rockets could push the ceiling for the parcel service industry, which Morgan Stanley says “suffers by excess capacity,” in addition to also give brand-new meaning to same-day delivery.

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