Walmart teams up with Cruise to test deliveries with electric, self-driving cars

Dive Brief:

Walmart will test delivery using autonomous electric vehicles in a new partnership with self-driving car company Cruise, the retailer announced on Tuesday in a blog post.
The pilot will roll out in the Phoenix suburb of Scottsdale, Arizona, early next year. Walmart plans to use Cruise’s fleet of Chevy Bolt electric vehicles, which run entirely on renewable energy.
The self-driving car delivery initiative furthers Walmart’s pledge to reach zero emissions by 2040, Tom Ward, senior vice president of customer product at Walmart, wrote in the post. The partnership adds to others the retailer has forged with autonomous vehicle companies as the technology continues to ramp up.

Dive Insight:

Cruise, which is owned by General Motors, isn't the first autonomous vehicle company to partner up with Walmart to carry out deliveries. The retail giant already works with Nuro in Houston, Texas; Udelv in Surprise, Arizona; Ford in Miami-Dade, Florida; and Google spin-out Waymo in Chandler, Arizona. For the retail giant, delivery via robots is an investment in the long-term as driverless car technology is expected to continue expanding in the years ahead.

However, skeptics have questioned whether employing novel technology whose scalability remains questionable, and which are not currently a viable option in many U.S. states, is a savvy business decision. Nuro’s R2 vehicle is, at present, the only federally approved driverless delivery vehicle.

Walmart is a market leader in online service, including same-day delivery and its curbside pickup model. Its Express two-hour delivery program, launched in April, is now available from more than 2,800 stores, Ward wrote. An e-commerce experience report by Ipsos published last month ranked Walmart highly for in-store and curbside pickup, and a Rakuten Ready report found Walmart Grocery had the lowest order wait times among major grocery brands.

For self-driving car companies, product delivery is considered safer, and the permit process simpler, than putting passengers in self-driving cars. Cruise’s years-long effort to launch a driverless public taxi service has been stymied by both technological and regulatory issues. Cruise and Nuro – a Walmart partner in the Houston market — both enjoy deep-pocket venture capital funding. On Monday, Nuro announced it had secured $500 million in its latest funding round, bringing its total valuation at $5 billion.

Walmart’s delivery ventures have even extended to a new pilot program in New York and Las Vegas that uses drones to deliver at-home testing kits for COVID-19. Amazon, however, is giving Walmart’s delivery innovation a run for its money, having also launched a drone delivery pilot that it says outpaces vans in completing same-day orders.