Kroger Co. is one of the primary investors in autonomous delivery vehicle company Nuro’s new investment round that raised $600 million.
Cincinnati-based Kroger (NYSE: KR), the parent of Pick 'n Save and Metro Market stores in the Milwaukee area, is one of nine institutional investors Nuro announced early in November as it wrapped up the huge round of Series D funding.
Mountain View, California-based Nuro is a robotics company that has developed a customized self-driving vehicle specifically to deliver groceries.
The amount of Kroger’s investment wasn’t disclosed.
High-profile investors Google and Fidelity Management & Research Co. also invested in Nuro’s latest funding round that was led by Tiger Global Management.
Nuro plans to use the capital influx to spur the development and deployment of its autonomous delivery service across the country.
“We’re thrilled to have the backing of these prominent investors and world class companies, and honored that they support our vision of improving communities and revitalizing local commerce,” Nuro co-founder and president Dave Ferguson said in a news release. “We believe this investment will allow us to accelerate our commercialization strategy and better everyday life with Nuro’s technology.”
Kroger’s investment is just its latest move to enhance its grocery home delivery capabilities that began a few years ago and have been stepped up since the coronavirus pandemic began.
Kroger first partnered with Nuro in 2018 on a self-driving vehicle delivery service. The companies made the initial announcement on the same day as Kroger’s annual shareholders meeting June 28 of that year and displayed a prototype vehicle at the event at Music Hall in Cincinnati.
Kroger and Nuro rolled out a pilot program in Scottsdale, Arizona, in August 2018. The following spring Kroger shifted its use of Nuro to the Houston market.
“Kroger launched its partnership with Nuro in 2018 to explore grocery delivery through autonomous vehicles,” Kroger chief information officer Yael Cosset said in a news release. “Since then, Kroger and Nuro completed thousands of deliveries to our customers – driving innovation that supports our expanding seamless ecosystem.”
Kroger has also teamed with Instacart for delivery in many of its markets and uses other services to deliver groceries to customers’ homes. It also launched its first Ocado automated warehouse and distribution facility in Monroe this spring and later opened a similar Ocado customer fulfillment center in Florida, with more in the works. Those facilities make home delivery faster and cheaper.
Kroger CEO Rodney McMullen told me earlier this year Covid “probably accelerated five years’ worth of transition in five weeks” in terms of customers shifting from in-store shopping to also using pickup and home delivery services.
Kroger now offers home delivery for customers from 2,546 delivery locations, covering 98% of its customer households. Kroger has 2,742 stores in 35 states.
Other grocery companies are teaming with self-driving vehicle makers to enhance their delivery services too. Those include Walmart announcing today it's making fully driverless deliveries with Gatik and Albertsons partnering earlier this year with Tortoise for driverless delivery.
