Welcome to the future!
Walmart is the world’s biggest retailer, equipped with a huge fleet of vehicles and an incredible logistics network. So it is no wonder that they are one of the driving forces when it comes to removing drivers altogether.
Autonomous vehicles are no longer consigned to science fiction. This is very real technology available to us in 2021, and it seems that the tech will only continue to grow. Partnering with car giants Ford, Walmart has set out to create an autonomous delivery system.
Emergen Research has provided an incredibly insightful report regarding the future of the autonomous delivery vehicle marketplace, expecting growth rates to hit almost 50% as the technology available continues to advance.
So, how will this affect consumers? What will the partnership between Walmart and Ford look like?
The self-driving startup Argo AI is heavily involved in this driverless delivery service. The company is known as one of the leaders in the marketplace, and was founded by Bryan Salesky and Peter Rander, who were involved in Google and Uber’s renowned automated driving programs.
Argo AI will be providing the technology, as there are tests in three different cities in the US scheduled for 2021.
Miami, Austin, and Washington will be the first cities to see the self-driving vehicles delivering from Walmart. Groceries and other items will be available in these areas as Walmart provides the world’s first self-driving service across multiple cities.
Where does Ford come in? Well, while Argo AI are providing the self-driving technology, the vehicles used will be Escape hybrids, which are running the technology developed by Argo within. Argo doesn’t currently have the infrastructure to provide the vehicles themselves.
Walmart’s strategy to move into driverless or “robot” delivery is not new. The brand is currently testing a number of different companies’ offerings when it comes to delivering goods including the bigger names like General Motors Co.’s Cruise LLC, and Alphabet Inc.’s Waymo, but also some of the smaller startups including Nuro and Gatik.
Bloomberg recently reported that this type of delivery could become a $1 trillion business. It’s not hard to see why the world’s best retailers want to be at the heart of it.
Speaking of the work carried out with Gatik, Tom Ward, Walmart’s U.S. senior vice president of last mile delivery said in a LinkedIn post: “After two years and more than 130,000 autonomous miles (with a safety driver) hauling customer orders between a dark store and a Neighborhood Market, Gatik has achieved a significant milestone by going FULLY driverless in our hub and spoke operation in Bentonville, AR.”
So, while Ford and Argo AI are one of the driverless options on the market, don’t be surprised to see Walmart use multiple partners. Ward continued: “It’s absolutely incredible to see the advancements made in AV middle mile transportation, right here in our backyard in Northwest Arkansas.”
Regarding the Argo partnership, Cynthia Kwon, Argo’s VP of strategy, also spoke of the work the two companies were doing together: “For a company like Walmart, which has locations everywhere in the U.S., it’s a very interesting and compelling proposition for us to be able to tell them, ‘Hey, we can expand with your business and we can do it quickly in a very scalable way,’”
How will this look for consumers?
Well, it is fair to say that the launch is not going to be widespread. Naturally, there are limitations to driverless delivery, including legislation.
Kwon has gone on record as saying that initially the service will begin with one store in each of the cities. “We will have to make sure someone’s home, and we will be experimenting with how the interaction is when someone goes to pick up the groceries or the package from the car, it should be a seamless and enjoyable experience.”
In the simplest possible terms, this will be the process of a Ford hybrid car appearing at your home with your goods shortly after ordering. The consumer will need to be home to accept the delivery, and go to the vehicle to get their items.
The plan eventually is to scale the service. Bryan Salesky, founder and CEO, Argo AI explained: “Working together with Walmart and Ford across three markets, we’re showing the potential for autonomous vehicle delivery services at scale.”
When you actually delve into the ownership of Argo, the partnership with Ford makes a lot of sense. Ford Motor Company owns 40% of Argo AI. They invested in 2017, just a year after the company itself was founded.
Argo is planning to go public this year, with a market value of around $7 billion.
Argo, along with Ford, has also agreed on a deal with Lyft to use self-driving cars in ride hailing, also in Austin and Miami, two of the locations of Walmart’s trials. It seems the US has its first “driverless capital cities”.
The company also has a partnership with VW, through which it has started to test self-driving cars in cities throughout Germany.
While the steps need to be tentative, it seems inevitable for drivers to be done away with. Of course, this could have a knock-on effect for the jobs market, but for companies like Walmart, it makes sense in the context of providing the fastest, most efficient deliveries for customers.
Argo AI is one of a few companies that has gained huge acclaim, and grown incredibly quickly, in their pursuit of driverless technology.
While we don’t expect Walmart to have a fleet of these vehicles all over North America by 2022, it is fair to assume that if the trial cities prove successful, we could be seeing more and more delivery options cropping up, initially in big cities, before spreading into rural areas.
The driverless revolution is going to take a lot of upheaval and transition, but with the backing of a retail giant like Walmart, this could all happen quicker than you may have imagined.
