Ocado prepares for food deliveries by robots with £10m investment in startup Oxbotica

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Ocado has prepared the ground for households' weekly shopping to be delivered by robots after investing £10m in technology startup Oxbotica.

The online supermarket, which is known for its hi-tech warehouses, said it was seeking to collaborate with Oxbotica to build hardware and software for driverless vehicles.

The partnership will seek to develop autonomous vehicles for “last-mile deliveries and kerb-to-kitchen robots”, Ocado said.

It is hoped that applying artificial intelligence and machine learning to deliveries will lower costs for customers.

Ocado said it would build teams of engineers to work with Oxbotica on multiple ways to use the Oxford-based startup’s technology.

The £10m investment is part of a £34m series B funding round for Oxbotica, led by BP Ventures.

The move towards greater automation will not affect Ocado’s current workforce or hiring plans, the company added.

However, in a stock market announcement laying out the reasons for the investment, Ocado pointed out that labour currently accounts for about 50 per cent of delivery costs.

As well as cutting costs, a new driverless fleet would cut emissions by speeding up the shift to electric delivery vans, Ocado said.

The first prototype automated vehicles are expected “within two years”. Ocado predicts that driverless vehicles will be used at its warehouses before they start dropping off shopping to customers’ houses.

The initial development work will focus on UK operations and will then extend to international markets where partners operate, Ocado told investors.

Alex Harvey, chief of advanced technology at Ocado, said: “We are excited about the opportunity to work with Oxbotica to develop a wide range of autonomous solutions that truly have the potential to transform both our and our partners’ CFC (customer fulfilment centres) and service delivery operations, while also giving all end customers the widest range of options and flexibility.”

Paul Newman, cofounder and chief technology officer of Oxbotica, said: “This is an excellent opportunity for Oxbotica and Ocado to strengthen our partnership, sharing our vision for the future of autonomy.

“By combining both companies' cutting-edge knowledge and resources, we hope to bring our universal autonomy vision to life and continue to solve some of the world’s most complex autonomy challenges.”