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Waymo partners with Walmart to test grocery pickup service in Arizona

It’s a new, unique business model for AV technology

Photo by Amelia Holowaty Krales / The Verge

It’s been a little over a year since Waymo, the Alphabet-owned self-driving vehicle company, first launched its early rider program in an attempt to test its evolving technology and understand what it is that riders want out of an automated vehicle service. Today, the company announced that after months of research, it will be partnering with five different companies to expand its reach and provide discounts for services riders already use the AV technology for.

In a blog post, Waymo said test riders primarily use the self-driving cars to run smaller errands like shopping at retail locations or to pick up groceries. The company is launching a test pilot in Arizona with Walmart later this week that will provide riders with discounts on groceries that are ordered through the massive supermarket chain’s website. While those orders are being prepared by Walmart employees, Waymo will transport customers to and from their homes to pick up their groceries.

While Waymo’s business model begins at motivating customers to ride in its fleet in the first place, the money-making aspect will likely come after passengers are inside the vehicle. Once Waymo can persuade riders to get in a self-driving car, it can capture their attention during the ride with various in-car entertainment offerings. By providing shopping discounts, like Waymo has announced it will, the offer could potentially boost ridership, where those billions in entertainment dollars could then be made.

Waymo’s other partnerships with rental car companies like Avis Budget Group will be expanding as well. Avis can now offer customers Waymo vehicles to help pick up their rentals and take them to the airport or back home after they’ve returned the cars. AutoNation will now be able to offer the AVs rather than a loaner car when the rider’s own personal vehicle is being serviced, too.