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Kroger To Use Self-Driving Trucks To Make Deliveries From Warehouse To Some Stores

Supermarket Giant Takes Next Step in Automating ‘Middle Mile’ Distribution With Gatik
Gatik’s medium-duty autonomous box trucks will transport fresh food from a Kroger customer fulfillment center in Dallas to multiple stores. (Gatik)
Gatik’s medium-duty autonomous box trucks will transport fresh food from a Kroger customer fulfillment center in Dallas to multiple stores. (Gatik)
CoStar News
March 15, 2023 | 10:34 P.M.

The nation's largest supermarket chain will soon be using self-driving trucks to transport groceries from its customer fulfillment center in Dallas to some stores in that market, taking another step to automate distribution and get online orders delivered faster.

Kroger, headquartered in Cincinnati, has struck a multiyear deal with Gatik to use that Mountain View, California-based company's autonomous box trucks to bring customer orders to multiple Kroger retail locations from its Dallas fulfillment center. The so-called "middle-mile" logistics operation is slated to launch in the second quarter this year, Gatik said Wednesday in a statement.

"The collaboration involves consistent, repeated delivery runs multiple times per day, seven days per week across Kroger’s Dallas distribution network, while unlocking the advantages of autonomous delivery for Kroger’s customers: Increased speed and responsiveness when fulfilling e-commerce orders, reduced costs and dedicated capacity across the supply chain’s middle mile," Gatik said.

Retailers have increasingly been employing high technology to streamline their supply-chain networks. Companies such as Amazon, Walmart as well as Kroger have opened robotic distribution centers, in large part to help handle online orders and same-day or next-day deliveries. Kroger has even taken that a step further, by debuting customer fulfillment centers, nicknamed "sheds," in markets where it doesn't even have physical stores so it can expand its footprint and fulfill online grocery orders in those areas. Now it's turning to automated trucks.

Gatik, which also counts Walmart as a customer, and Kroger didn't immediately respond to emails asking how many Dallas stores will be getting deliveries from the self-driving trucks.

Automated Trucking Faces Hurdles

But being able to offer online grocery ordering is a competitive arena, with competition from not only giants such as Amazon and Walmart but also standalone services such as FreshDirect as well as other supermarket chains.

To serve Kroger, Gatik said it will be using its medium-duty self-driving box trucks, which can transport ambient, refrigerated and frozen goods.

“These autonomous box trucks will help us continue our commitment to creating a seamless shopping experience where customers can access their favorite fresh foods, with zero compromise on value or convenience,” Raúl Bujalil, Kroger vice president of supply chain strategy and technology enablers, said in a statement.

The automated truck industry has its challenges in the United States, with rough safety regulations. Right now two dozen states allow the commercial operation of intrastate autonomous trucks, and many states permit the testing of self-driving trucks that have a human backup driver on board. But for interstate travel, autonomous trucks still need permission from the federal government, which is why Gatik is focused on doing short-haul routes.

“We’re deeply familiar with operating our autonomous fleet within the Dallas ecosystem, and we’re very excited to bring that experience to support Kroger in its mission to reshape the future of goods delivery,” Gautam Narang, Gatik co-founder and CEO, said in a statement.

Gatik’s autonomous box trucks, which are also deployed in markets such as Arkansas and Ontario, "will help support Kroger by meeting customers’ immediate needs whether they shop online or in-store, providing access to goods faster and more reliably than ever before," according to the logistics firm.

Gatik in 2021 "became the first company worldwide to operate fully driver-less commercial deliveries on the middle mile," according to the California-based business.