Economic feasibility analysis of small-unmanned aircraft Systems (sUAS) commercial package delivery: Improvement of FAA pilot-to-sUAS and visual line of sight (VLOS) regulation

Abstract

This study evaluates the economic feasibility of small Unmanned Aircraft Systems (sUAS) commercial package delivery under evolving Federal Aviation Administration (FAA) regulatory frameworks. The analysis focuses on the impact of pilot-to-sUAS ratio relaxation, specifically 1:1, 1:10, and 1:20 scenarios, on operational cost efficiency and profitability. Using comparative cost modeling and simulation analysis, the study integrates real-world data from FAA waivers, FAA BVLOS ARC recommendation, and Matternet trials, and verified industry cost benchmarks to construct a reproducible financial model for multirotor and fixed-wing platforms. Results demonstrate that under the current 1:1 FAA restriction (Part 107), commercial sUAS delivery operations remain economically unviable due to high labor costs. However, when the pilot-to-sUAS ratio is relaxed to 1:10, profit margins improve significantly, and at a 1:20 ratio, operations transition into sustainable profitability. For example, profitability in San Francisco increases from −5.82 percent under the 1:10 scenario to 16.3 percent under 1:20, while New York City improves from −13.43 percent to 10.29 percent, despite weather-related constraints. These findings confirm that regulatory flexibility in pilot-to-sUAS ratios is a primary driver of cost reduction and operational scalability in drone logistics. The results also support the FAA’s BVLOS ARC recommendations emphasizing performance-based regulation and automation thresholds (AFR Levels 2–3) as key enablers of scalable, safe, and economically feasible one-to-many operations. The study contributes an analytical framework that links regulatory conditions to economic outcomes, providing quantitative evidence for policy design and industry adoption. By integrating cost modeling, simulation, and regulatory analysis, it offers a standardized approach for evaluating future multi-drone logistics operations and supports broader integration of sUAS within the advanced air mobility (AAM) ecosystem.