Walmart is engaged in a massive battle with Amazon for survival in the fiercely competitive world of online retail. To do that, it needs to find ways to reduce delivery costs while also reducing the time it takes to get products into the hands of customers as quickly as possible after an order is placed. This week it announced it has signed a deal with Southern California’s electric vehicle startup Canoo to buy 4,500 of its battery-electric vehicles. Lifestyle delivery vehicles† The electric vans are used for last mile deliveries to customers.
Canoo would not share the financial terms of the deal. However, a spokesperson announced that these are binding pre-orders, starting with Canoo’s ‘Lifestyle Delivery Vehicle’. Under the agreement, Walmart has an option to buy 10,000 units TechCrunch† Earlier this year, Canoo warned it may not have enough cash to stay in business, so while neither company is talking about the dollars involved in the deal, it seems a safe bet that the Walmart order is a bit of a lifeline. can be for the struggling company.
The announcement comes about 8 months after Canoo announced plans to establish its headquarters and advanced industrial manufacturing facility in Bentonville, Arkansas, where Walmart is headquartered. The first production facility, which is not yet operational, is located in Pryor, Oklahoma. Walmart has a history of encouraging suppliers to locate in its hometown.
“We are encouraged that by being close to Canoo’s headquarters, we have the advantage to collaborate and innovate in real time, as well as the opportunity to help create manufacturing and technology jobs here in our home state of Arkansas,” David Guggina, senior vice president of innovation and automation, Walmart US, said in a statement.
The Canoo LDV
Canoo’s LDV is built on a multi-purpose platform architecture that integrates the motors, battery module and other drive components. Canoo CEO Tony Aquila, who is also an investor in the company, previously said: TechCrunch The adaptable vehicles, which have approximately 120 cubic feet of cargo space, are ergonomic, spacious and more cost-efficient than other vans on the market today thanks to a steer-by-wire technology that reduces moving parts and cabin intrusion. Drivers in the vehicle will immediately notice the lack of a traditional steering column and large windshield that offers expansive views.
Walmart will begin using a number of pre-production EVs to deliver online orders in the Dallas-Fort Worth metro area. Canoo will use this as a test bed for the coming weeks to fine-tune and finalize the vehicle configuration. The Lifestyle Delivery Vehicle, or LDV, is expected to enter production in the fourth quarter of 2022 and be on the road by 2023, Canoo said. The Canoo LDVs will be used by Walmart employees to deliver online orders. The EVs could also be used for Walmart GoLocal, the retailer’s delivery-as-a-service business, according to the companies.
The Walmart Delivery Ecosystem
Canoo is just one potential part of Walmart’s increasingly complex delivery system that uses independent contractors, its own employees and third-party delivery services, as well as more futuristic technology such as autonomous vehicles and drones to respond to consumer demand for instant access to goods. Walmart has pilot programs with Because to use autonomous box trucks to deliver goods from its fulfillment centers to its convenience stores. The retail giant is also partnering with drone companies Zipline and DroneUp† The company says it can now reach 80% of the U.S. population with same-day delivery “of a growing range of items.”
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