Walmart is jumping into the autonomous vehicle sector, investing in a San Francisco-based self-driving car company.
The Bentonville retailer is investing in Cruise, a company that is developing a fleet of self-driving electric vehicles. This investment, according to Walmart U.S. president and CEO John Furner, is intended to help develop Walmart’s last mile delivery ecosystem.
“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,” Furner said in a corporate blog.
This is the next step in the relationship between Walmart and Cruise. In November 2020, Walmart announced that it would be piloting a delivery program with Cruise in Scottsdale, Ariz. in 2021. Through this program, Scottsdale area customers would be able to place local store orders, which would be delivered by a Cruise vehicle.
Furner also highlighted the environmental impact that Cruise has with its focus on renewable energy, stating that the investment reflected Walmart’s commitment to achieving zero emissions by 2040 and to be powered by 100 percent renewable energy by 2035. “We’ve been impressed with Cruise’s differentiated business model, unique technology and unmatched driverless testing. We also value our shared commitment to a zero emissions future,” he said.
Walmart’s investment in Cruise is part of a previously announced investment round for the company. Several new institutional investors also joined Walmart in the round.
Cruise, which is backed by General Motors, entered into a strategic partnership with Microsoft in January 2021 to accelerate the commercialization of its vehicles. As part of this partnership, Microsoft joined General Motors, Honda and institutional investors in investing more than $2 billion in equity in the company.
With Walmart’s investment, Cruise has raised $2.75 billion during the fundraising round, increasing the company’s valuation to a reported $30 billion. According to Cruise’s corporate website, the company has raised more than $9.25 billion in committed capital. Crunchbase shows the company has raised $7.3 billion in capital.
“Self-driving cars will make transportation safer, cleaner and more accessible for everyone. Making this happen requires a clear mission, world-class talent, great partners and a lot of capital” Cruise CEO Dan Ammann said.
Founded in 2013, Cruise was acquired by General Motors in 2016. The acquisition was designed to spur General Motors’ development of autonomous vehicles. Most recently, Cruise acquired self-driving car startup Voyage, which focused on retirement communities. in March 2021.
Walmart continues to build its delivery options, having launched Express Delivery in April 2020 and scaling the service to thousands of stores. In 2020, Walmart launched a partnership with DroneUp and Quest Diagnostics to deliver COVID-19 kits in Las Vegas and Cheektowaga, New York. Walmart has also partnered with Flytrex to deliver groceries and household items by via and has partnered with Zipline to deliver health and wellness products in the Northwest Arkansas region.
READ MORE: Walmart Pledges $350 Billion Over 10 Years to Support U.S. Manufacturing
Image courtesy of Cruise
