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Gatik recently announced a multi-year commercial collaboration with Kroger to transport customer orders within Kroger’s Dallas distribution network.
Starting sometime in Q2 of 2023, Gatik’s medium-duty autonomous box trucks will be transporting products from a Kroger Customer Fulfillment Center (CFC) in Dallas, Texas to multiple retail locations. Gatik’s autonomous trucks will operate with safety drivers in the vehicles for now, but the company plans to eventually take them out.
Gatik’s trucks feature a cold chain-capable 20′ foot box to transport ambient, refrigerated, frozen goods. The collaboration involves consistent, repeated delivery runs multiple times per day, seven days per week, across Kroger’s Dallas distribution network. Each trip, from a CFC to a retail location, typically involves around 60 miles of driving round trip, according to Gatik’s Head of Policy and Communications Richard Steiner.
The company has always been interested in automating the middle mile. Steiner joined the company in 2019, just two years after it was founded, and has helped it grow into a now 150-person team.
“What we’ve seen over the last few years, even prior to the pandemic, is e-commerce going through the roof,” Steiner said. “Consumers like you and me no longer want to wait three, four, or five days for goods, we want them within a one to two-hour pickup window.”
According to Steiner, this change in the way people shop has led to smaller distribution centers, more micro fulfillment centers and more customer fulfillment centers closer to where those customers live. This is where automating the middle mile, between these fulfillment centers and retail locations, can greatly increase the speed and number of orders fulfilled.
“A really, really critical point to note about what we’re doing there is we’re increasing the delivery frequency,” Steiner said. “So that means that Kroger’s customers have a greater range of same-day pickup times as well as greater flexibility with cut-off times to place their orders.”
Automating the middle mile also means getting autonomy into the hands of Gatik’s customers quickly, because the team only needs to operate its AVs on repeatable routes instead of anywhere in a city a person might want to go.
“Compared to the other applications of technology, either long haul or passenger transportation, [middle-mile transportation] is simpler,” Steiner said. “We are constraining the challenge of autonomy by focusing on fixed known repeatable point-to-point routes. So whereas the passenger transportation models require mapping out an exponentially larger and larger geo-fenced area to serve an increasing number of consumers . . . We focus on a limited number of pickup locations and drop off locations, which means that we know our routes more intimately than anyone else on the planet.”
While Gatik doesn’t have a specific timeline for when it will be able to pull out its safety drivers from its trucks in Texas, with each deployment, including its deployment with Walmart in Arkansas and with Loblaw in Ontario, the process keeps moving faster.
“With Walmart in Arkansas, we began commercial operations in June of 2019. We pulled the driver out in August of 2021, so about two years right?” Steiner said. “With Loblaw, we began commercial operations in January 2020 and pulled the safety driver out 19 months after that. So we went from 24, 25 months to 19.”
Gatik has three phases that it works through for deployments. The first involves millions of miles of simulated training, which is followed by the second phase, which involves private closed course track testing, first with safety drivers and then without. Finally, the Gatik team moves into its public testing phase.
With or without a safety driver, Gatik’s trucks begin generating revenue for its customers on day one.
“We’ve now done over half a million customers orders across our customer base in North America,” Steiner said. “Every single one of those deliveries has been revenue generating. So we’re not testing for testing’s sake. This is a real business. This is a revenue-generating business.”