As speedy delivery continues to be a point of differentiation for retailers, Walmart has invested an undisclosed sum into Cruise, the San Francisco-based autonomous vehicle company, according to a Thursday announcement.
Cruise's business model, technology, zero emissions goal and "unmatched" driverless testing attracted the retailer to the startup, according to John Furner, president and CEO of Walmart U.S. The funding will help Walmart develop a last-mile delivery ecosystem that's scalable, fast and low-cost.
The investment is part of Walmart's overall effort to integrate self-driving cars into its business, per the announcement, and comes after a pilot with Cruise that began in November last year.
With more consumers shopping online, developing a robust last-mile delivery service could be a critical factor in providing a positive and competitive shopping experience. The investment follows Walmart's pilot with Cruise in Scottsdale, Arizona, last fall, where customers' orders were delivered from nearby Walmart locations using the self-driving electric vehicles.
"Over the years we've been doing a lot to learn more about the role autonomous vehicles can play in retail, and we've seen enough to know it's no longer a question of if they'll be scaled, but when," said Furner in the announcement.
In addition to testing out autonomous vehicle deliveries and investing in Cruise, Walmart has made other moves to improve its delivery offerings. Last November, the retailer announced plans to acquire talent, technology, intellectual property and other assets from JoyRun, a peer-to-peer last-mile delivery startup. The retailer also stopped imposing a $35 minimum order requirement for its two-hour Express delivery service last month.
Meanwhile, as Cruise raises capital and Walmart seeks to modernize last-mile deliveries, other companies are developing and implementing new delivery strategies, too. Target recently shared its plans to use its new sortation center in Minneapolis to test a faster delivery service with Shipt. Last month, Nuro, another autonomous vehicle startup, added more investors to its Series C funding round, which will go toward developing its self-driving technology, hiring staffers and expanding its delivery service.