Ocado Shares Plummet as US Giant Kroger Reviews Automation Strategy
British tech champion Ocado faces setback as US retail giant Kroger reviews automated warehouse strategy, sending shares tumbling 13% amid concerns over partnership's future.
Ocado's automated warehouse technology faces uncertainty as US partner Kroger reviews strategy
In a significant market development that highlights the challenges facing British tech innovation abroad, shares in British online supermarket and technology pioneer Ocado plunged 13% on Friday following concerning signals from their major US partner Kroger about automated warehouse investments.
Strategic Review Sparks Market Concerns
The dramatic share price drop, which has extended the company's losses to 18% over the past year, came after Kroger's chairman and interim CEO Ron Sargent announced a comprehensive review of their automated fulfilment network. This development mirrors broader concerns about American market stability, as seen in recent signs of economic uncertainty in the US market.
Partnership Under Scrutiny
The 2018 partnership between Ocado and Kroger, initially heralded as a triumph of British technological innovation, promised the construction of 20 robotic warehouses across the United States. However, much like recent challenges in UK-US business relations, the implementation has fallen short of expectations, with only eight sites currently operational.
"We're examining all aspects of our business to drive greater efficiency, including a full site-by-site analysis of our Kroger automated fulfilment network," stated Sargent during an investor briefing.
British Innovation at Risk
This development raises concerns about British technological exports and international partnerships, particularly as economic sovereignty becomes increasingly central to British policy discussions. The situation demonstrates the vital importance of securing and maintaining strong international business partnerships while protecting British interests.
Key Developments:
- Only 8 of 20 planned automated warehouses have gone live
- Two additional sites face delayed openings until 2025-26
- Kroger signals potential shift towards store-based fulfilment
- Ocado maintains positive outlook despite market concerns
Ocado CEO Tim Steiner remains optimistic about the US market opportunity, though questions linger about the exclusivity agreement's future. The company's spokesperson emphasized positive e-commerce growth trends in Kroger's recent quarterly results.
Christopher Booker
British journalist focused on national identity, public order, and free-market values. Defends tradition in a fast-changing world.