Walmart taps Udelv for latest driverless car tests to deliver groceries

Key Points
  • Walmart is now piloting a grocery delivery program with autonomous vehicle company Udelv in Surprise, Arizona.
  • It's already worked with companies including Ford and Waymo to experiment with driverless cars.
An Udelv car that's being used in Walmart's test in Arizona.
Source: Walmart

Walmart is expanding its tests of driverless cars as a way to get online grocery orders to shoppers' homes more quickly.

The big-box retailer is now piloting a program to use Udelv autonomous-driving vans to deliver fresh groceries in Surprise, Arizona.

"We want to make sure we stay on the cutting edge of grocery delivery by exploring what's new and next," Tom Ward, senior vice president of Walmart's digital operations in the U.S., said Tuesday in a blog post.

Walmart has already announced other pilot programs with self-driving car companies, including Ford and Alphabet's Waymo. The company plans to end this fiscal year with an online grocery delivery option in roughly 100 metropolitan areas, reaching more than 40 percent of U.S. households. For 2019, it plans to add that to another 800 stores.

There's good reason for retailers to be investing in online grocery delivery.

Online spending by U.S. consumers for groceries is expected to climb 15 percent this year, according to a survey by Brick Meets Click, an advisory group for grocers. That would push the share of grocery sales that take place on the internet to 6.3 percent of overall sales.

Companies that offer delivery and pick-up options for grocery orders should see even bigger growth, Brick Meets Click said. Those retailers' online sales could grow by 25 to 30 percent in 2019. By the end of the year, roughly 90 percent of U.S. households are forecast by Brick Meets Click to have access to at least one delivery or pick-up service for groceries. Other businesses experimenting in the space include Kroger, Whole Foods (via Amazon) and Albertsons.

Earlier this week, Walmart launched a campaign that aired during the Golden Globes and showed famous cars — like the Scooby Doo mystery machine — pulling up to Walmart stores and using its online grocery pickup service. That's also now available nationally.

Walmart's head of e-commerce in the U.S., Marc Lore, recently said the retailer was focused on taking food delivery to the next level, in addition to its driverless car tests. He envisions a day when food will be delivered to shoppers' refrigerators.