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Kroger to bring driverless cars to grocery delivery
Kroger announced plans Thursday to partner with driverless car company Nuro to deliver groceries using its autonomous vehicles.
The partnership comes as the largest U.S. grocery players continue to tackle the expensive challenge of "last mile delivery" — the final step in getting a product to a shopper's home. It is a feat that is particularly perilous when dealing with fragile products like fresh food. It is further complicated by populations that vary wildly across the U.S., with some far less dense that others.
Walmart recently said it was partnering with Postmates to expand its online grocery delivery program. Amazon announced early Thursday plans to work with entrepreneurs who run their own local delivery networks of up to 40 delivery vans. It is not clear whether it will use that network for food delivery.
Kroger, meantime, has made a series of bold steps over the past few months to further its online grocery and delivery business. It announced its investment in British online grocer Ocado, which it will use to build out automated warehouses throughout the U.S. It also bought meal kit company Home Chef.
Earlier this month, it said that digital sales for the past quarter had grown 66 percent.
"We cannot just rely on physical stores to reach all of our customers for delivery and and pick-up," said Yael Cosset, Kroger's chief digital officer, in an interview with CNBC.
Kroger has more than 2,800 stores across the U.S., under banners like Fred Meyer, Ralph's and Harris Teeter.
Nuro, founded in 2016 by Google engineers, is an autonomous car company built explicitly for the business of transporting goods. That means its cars are slimmer and designed differently than ones meant to carry people. Nuro does not yet have special refrigerated cars, but is working on a new iteration of vehicles with such technology.
Kroger and Nuro will begin their partnership this fall. Cosset did not detail a timeline, but did say it would be "aggressive." It will experiment with the technology in areas that both overlap with and are separate from where it plans to build out its Ocado warehouses.