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Walmart ends grocery delivery deal with Uber and Lyft

Jordan Crook
In 2016, Walmart announced that it would begin testing grocery delivery in

In 2016, Walmart announced that it would begin testing grocery delivery in conjunction with Uber and Lyft.

Today, however, Reuters reports that those partnerships have come to an end, which was confirmed by Walmart and Uber.

TechCrunch first reported in 2015 about Uber's plans to launch a merchant delivery system, wherein goods from retailers would be delivered (via the trunk) and Uber users would be transported to their destination simultaneously.

The deal with Walmart, alongside rival services like Lyft and Deliv, marked massive progress for this merchant delivery system. But things haven't panned out long term.

"It is incredibly hard to deliver people and packages together," said one of Reuters' sources with a delivery company that works with Walmart and has direct knowledge of the matter. "They are two completely different business models."

Walmart has a number of other channels through which it can offer delivery.

It has partnered with Postmates and DoorDash, but has excluded Instacart from its delivery partners list. According to Re/Code, Instacart was excluded from the partnership opportunity because Instacart wanted Walmart to list its retail items within the Instacart app, whereas Walmart wanted to use Instacart as a delivery partner while exclusively selling items on its own digital property.

This obviously comes at a time where the grocery delivery game is heating up. Amazon's acquisition of Whole Foods has put pressure on incumbent grocery retailers to step up their digital presence and delivery capabilities.

Target acquired Alabama-based Shipt for $550 million in December of 2017. Meanwhile, Instacart has raised another $150 million this year, and recently announced a partnership with Walmart-owned Sam's Club.

We've reached out to Uber and will update if/when we hear back.