By Jack Denton
High-tech supermarket and logistics group Ocado is pushing toward a future where, from warehouse to doorstep, groceries will be handled by robots.
The British group, a grocery delivery rival to online retail giant Amazon /zigman2/quotes/210331248/composite AMZN +2.10% in the U.K. and joined with grocer Kroger /zigman2/quotes/206215053/composite KR -0.98% in the U.S., will invest £10 million ($13.8 million) in a commercial partnership with Oxbotica, an autonomous vehicle software company, the company said on Friday.
Shares in Ocado /zigman2/quotes/207225647/delayed UK:OCDO -1.17% climbed near 2% on the day, helping London’s blue-chip FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX -0.01% index top 7,000 for the first time in more than a year.
The partnership will involve collaborating on hardware and software interfaces for autonomous vehicles, Ocado said, integrating Oxford, U.K.-based Oxbotica’s software platform on Ocado’s vehicles.
The next steps are for Ocado to fit out its delivery vans and warehouse vehicles with data capture capabilities to help Oxbotica to test its technologies. The vision is to automate the entire grocery delivery process: from vehicles that operate inside and out of Ocado warehouses, to last-mile delivery vehicles and “curb-to-kitchen” robots.
“We are excited about the opportunity to work with Oxbotica to develop a wide range of autonomous solutions that truly have the potential to transform both our and our partners’ [customer fulfillment center] and service delivery operations, while also giving all end customers the widest range of options and flexibility,” said Alex Harvey, Ocado’s head of advanced technology.
Founded by former Goldman Sachs /zigman2/quotes/209237603/composite GS +1.53% bankers in 2000, Ocado’s business is built on its roots as a high-tech grocery delivery company — and it is a competitive player in the cutthroat British supermarket sector. But one of its key areas for growth is creating custom logistics and warehousing solutions using its proprietary robotics technology.
In that vein, it has a partnership with U.S. retail giant Kroger dating back to 2018. Earlier this week, Kroger launched its first Ocado warehouse combining robotics and machine learning for fast fresh food delivery located in Monroe, Ohio, north of Cincinnati.
Ocado said the “ultimate ambition” of its multiyear collaboration with Oxbotica is to enable partners like Kroger to reduce the costs of both last-mile delivery and logistics operations.
The £10 million investment in Oxbotica came as part of the company’s Series B equity funding round, led by the venture arm of energy giant BP /zigman2/quotes/202286639/delayed UK:BP +1.81% , which has tested autonomous vehicles using Oxbotica’s technology at a refinery in Germany. Chinese tech giant Tencent /zigman2/quotes/204605823/delayed HK:700 +2.02% and safety equipment group Halma /zigman2/quotes/204238281/delayed UK:HLMA -1.36% were among the other investors.