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Airbus drone set to deliver parcels throughout a university campus

Airbus completed its first flight demonstration of an air vehicle which will eventually deliver parcels to stations around a university campus in Singapore.

Unmanned drones will begin flying between parcel stations on campus by the middle of the year. The drones will land on roofs of stations, where a robotic arm will retrieve a package and place it in an individual locker. Customers can then pick up their package at any hour from the lockers.

CNBC attended the initial flight demonstration at the National University of Singapore campus where the drone appeared quite large and carried a packaged shirt inside.

The drone can carry between 2 to 4 kilograms, under 9 pounds. The machine weighs approximately 25 kilograms, which is about 55 pounds.

A representative from the Civil Aviation Authority of Singapore said the eventual plan is to roll out the drone parcel delivery system across the city-state, so long as it's done in phases.

Airbus is joining the race to dominate the highways of the sky against competition from tech giants Google and Amazon.