Kroger is about to add another layer of automation to its customers’ online grocery orders filled by robots at its new $55 million fulfillment center in southern Dallas.
California-based Gatik is pitching its autonomous vehicle deliveries as a way for retailers to cut costs and save time in their constant effort to be in stock by using frequent deliveries from small self-driving trucks instead of big semitrailers.
For Kroger, Gatik will increase same-day pick-up slots, delivery frequency and allow for longer cutoff times for when customers can place online grocery orders. Completed online grocery orders will be transported to Kroger stores for customers to pick up or have delivered.
Kroger, Sam’s Club and suppliers Georgia Pacific and Pitney-Bowes are among eight Fortune 500 companies so far working locally with Gatik. The company opened an autonomous trucking facility in Fort Worth in mid-2021. KBX Logistics, the transportation arm for Koch Industries, which is also working locally with Gatik and an affiliate, Koch Disruptive Technologies, led an $85 million investment in Gatik that helped fund the Dallas-Fort Worth expansion.
Gatik’s more than 25 trucks on Dallas-Fort Worth roads are operating with a safety driver onboard, but that may change soon.
Richard Steiner, Gatik’s head of policy and communications, said the company is planning “to ramp up to (safety) drivers being out” of the trucks by sometime in 2024.
Gatik, which is required to report monthly to the National Highway Traffic Safety Administration, has had no accidents, he said. Gov. Greg Abbott signed a bill into law in 2017 that laid the groundwork for how autonomous vehicles can operate on Texas roads. Other companies are experimenting in the state, including Kodiak Robotics and Google’s Waymo.
The Dallas-Fort Worth market’s density and sprawl allow for lots of urban and semi-urban driving experiences for its trucks, Steiner said. “With our safety drivers, we’re collecting huge amounts of data, safety verifications and transposing in real time to our customers.”
The company claims its deliveries have cut customers’ costs by up to 30% and it’s completed delivery of more than 500,000 orders in Texas, Arkansas and Ontario, Canada.
Starting this spring, four self-driving trucks will be making deliveries to three Kroger stores. The trucks will travel seven days a week, 12 hours a day to make multiple runs from Kroger’s new fulfillment center in southern Dallas at 4221 Telephone Road. The stores weren’t identified. Kroger is shipping online orders throughout Dallas-Fort Worth from that facility.
Kroger is also using the facility to ship orders to hubs in Oklahoma City, Austin and San Antonio, which are markets where it doesn’t have stores. Kroger’s national name recognition allows it to offer online grocery delivery beyond its store markets.
The automated 350,000-square-foot facility was completed last summer and is one of several Kroger is building in the U.S. with its U.K. technology partner Ocado.
Kroger declined a request for an interview, but in a news release, Raúl Bujalil, Kroger’s vice president supply chain and technology enablers, said Gatik will help the grocer with its “commitment to creating a seamless shopping experience — where customers can access their favorite fresh foods, with zero compromise on value or convenience.”
Gatik’s 20-foot refrigerated box trucks can transport various fresh and frozen foods. Each Kroger route is an average of 60 miles per round trip. Each truck will make a minimum of four deliveries to each store daily, Gatick said. Kroger’s routes include highway driving up to 70 mph.
Last summer, Gatik trucks started delivering Georgia-Pacific brands such as Quilted Northern bath tissue and Dixie paper plates to 34 Sam’s Club stores.
The Gatik box trucks replaced big rigs. That arrangement is a more complex schedule than the new Kroger relationship, Steiner said. “It was the first time we replaced big rigs and it’s going well.”
