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Walmart hopes to use Ford and Argo technology to launch these self-driving vehicles for online delivery in Miami, Washington DC, and Austin.
Walmart Inc (NYSE: WMT) is entering into partnerships with Ford (NYSE: F)and Argo AI to test self-driving cars in multiple cities. The partnership involves using the Ford Escape hybrids with technology from Argo AI, an autonomous car technology company. Furthermore, Walmart will deploy the aforementioned vehicle brand for its deliveries in Miami, Washington DC, and Austin, Texas. This initiative will allow Walmart customers to place online orders for groceries and other items, and have them autonomously delivered door-to-door.
The autonomous Ford vehicles will initially have backup safety drivers onboard and run operations within a small delivery area. Walmart US senior vice president of last mile delivery, Tom Ward, issued a statement on the development:
“We’re excited to expand our autonomous delivery efforts in three new markets alongside Argo and Ford. This collaboration will further our mission to get products to the homes of our customers with unparalleled speed and ease, and in turn, will continue to pave the way for autonomous delivery.”
Walmart and Ford Earlier Partnered on Self-driving Cars Three Years Prior
Walmart and Ford previously collaborated on a pilot program with autonomous vehicles in 2018. Currently, the multinational retail corporation operates self-driving delivery pilots with Gatik and Cruise. The latter is backed by General Motors (NYSE: GM) and recently sold an undisclosed stake size to Walmart.
Online grocery orders account for a large part of Walmart+, the retail giant’s recently-launched membership program. With 32 million US members and counting, Walmart+ pulls in more customers with free and unlimited grocery deliveries to members’ homes. The membership program currently competes with Amazon Prime.
Walmart Saw Tremendous Success During the Pandemic due to Increased Online Orders
Walmart witnessed incredible growth in online sales during the height of the pandemic as more consumers were at home. The retail giant’s e-commerce sales in the United States surged 79% within the last fiscal year which ended on January 31st. However, Walmart is under some pressure as its e-commerce business is yet to turn a profit. The company now has to come up with more cost-effective ways to handle its delivery process.
Walmart’s new development with Ford and Argo AI is the first multi-city scheme using self-driving vehicles for the retail giant. However, Bryan Salesky, Argo AI founder and CEO, is optimistic about the initiative’s potential. Salesky said deploying in three cities will reveal “the potential for autonomous vehicle delivery services at scale.”
According to an Argo AI spokeswoman, the three companies involved plan to initially deploy a small number of delivery vehicles. Walmart, Ford, and Argo AI will look to eventually scale up as the business calls for it. Currently, Argo AI is testing self-drive vehicles in the three cities as well as others. The autonomous car start-up is jointly owned by Ford, and German automaker, Volkswagen (XETRA: VOW).
Mixed Results Trail Commercialization of Self-driving Vehicles
The commercialization of autonomous vehicles is proving to be far more difficult than initially thought a few years ago. Some industry players like Uber Technologies (NYSE: UBER) are ceasing resources on system development. Zoox, on the other hand, was sold to Amazon. So far, the most prominent autonomous vehicle front-runner is Waymo. The company runs a public autonomous vehicle fleet in Arizona.