This article appeared on techcrunch.com by Kristen Korosec. To read the original post click here.
Gatik, the autonomous vehicle startup focused on the ‘middle mile’ of logistics, has added box trucks to its fleet as Walmart and other customers look for ways to boost efficiency and shore up the supply chain amid surging demand from consumers ordering goods online.
Gatik came out of stealth nearly a year ago with a game plan — and Walmart as a customer — to haul goods short distances for retailers and distributors using self-driving commercial delivery vans. The self-driving vehicles still have a human safety operator behind the wheel.
CEO and co-founder Gautam Narang has previously told TechCrunch that the company can fulfill a need in the market through a variety of use cases, including partnering with third-party logistics giants like Amazon, FedEx or even the U.S. Postal Service, auto part distributors, consumer goods, food and beverage distributors as well as medical and pharmaceutical companies.
The business plan hasn’t changed. But its fleet has. In July, the startup launched a commercial service with Walmart to deliver online grocery orders from the retailer’s main warehouse to its neighborhood stores in Bentonville, Arkansas. Initially, Gatik used light commercial trucks and vans — specifically Ford Transit Connect vans — that were outfitted with its self-driving system.
Customer feedback prompted the company to add bigger temperature-controlled vehicles. Gatik’s commercial fleet of more than 10 vehicles are used to serve multiple Fortune 500 companies across North America, according to the startup. The figure doesn’t include additional vehicles being tested in California.
Gatik expects to name new partners and operations in U.S. and Canada this year.
The box trucks, which range in size between 11 and 20-feet long, can deliver ambient, cold and frozen goods. Each vehicle completes between six to 15 runs a day. Gatik has used its box trucks to deliver more than 15,000 orders for multiple customers since operations began.
The shift to autonomous box trucks taps into a trend among major retailers to use micro distribution centers to help meet increasing demand from consumers ordering goods online. Class 8 semi trucks, which once went directly to a retail store, now hauls goods to the MDCs. This allows retailers like Walmart to store more goods closer to its retail locations to meet demand for online orders.
“Micro fulfillment or distribution centers are all the rage right now — that’s basically the wave that we’re riding,” Narang said. “Companies are targeting warehouse automation for micro fulfillment centers. They’re automating the warehouses, and we’re automating the on-road logistics.”
Grocery chains were struggling to keep up with the growing demand of online grocery pickup and delivery even before the COVID-19 pandemic. But Narang expects demand for online grocery pickup and delivery to increase twofold. Gatik has already seen a 30% to 35% uptick in the number of runs it completes each day in order to meet demand.
“I think this is going to last because the crisis is shaping how consumers do their shopping,” Narang said.
Eventually, Gatik will pull the human safety driver out of the vehicle. It’s an achievable goal, Narang added, because the company has focused on repeatable pre-determined routes and has introduced constraints that simplify the technical challenge. For instance, Gatik vehicles don’t make multiple lane changes and only make right turns.