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Kroger plans to expand self-driving grocery delivery pilot

(Kroger photo) After what the company calls a successful pilot in Scottsdale, AZ, Kroger plans to expand its driverless delivery pilot to another market.

Kroger Co. CEO Rodney McMullen said the company has expanded Home Chef meal kits to an additional 500 markets, and other pilot programs are slated for expansion.

During the company’s fourth quarter 2018 earnings call held March 7, McMullen said Home Chef meal kits entered six new store divisions, including a pilot with Chicago-area Walgreens stores.

Kroger’s self-driving delivery pilot with Nuro also is going well, he said.

“The Nuro pilot in Scottsdale is nearly complete and we are planning to enter another market early this year,” he said, during the call.

Not all was good news as Kroger’s Q4 net income dropped $259 million from $854 million last year, and the company missed analyst expectations with $28.1 billion in net sales.

Kroger stock dropped almost 10% to $25.60 per share following the earnings call.

Company executives reassured analysts during the question and answer session, optimistic about progress on Restock Kroger initiatives, and growth in digital, which McMullen said he expects to be a “tail wind” soon instead of a “head wind.”

At the end of the call, one analyst asked for comments on Amazon, and recent rumors about physical stores in grocery. McMullen said Kroger has spent the past five years creating an omnichannel experience for customers, leveraging strengths like fresh produce.

“The quality of our fresh product continues to get better and better and it’s a competitive advantage,” he said. “What we find is when customers are engaged digitally they still come into the physical store and they also spend more with us in total.”


Pamela Riemenschneider is the Retail Editor for Blue Book Services.