Please ensure Javascript is enabled for purposes of website accessibility

Chipotle Mexican Grill Invests in a Robotic Delivery Company

By Rhian Hunt - Updated Mar 31, 2021 at 7:52AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The company says it's looking for "disruptive opportunities" to grow its "digital ecosystem."

Chipotle Mexican Grill (CMG -2.15%) has invested in autonomous delivery company Nuro, a press release from the company today says. Chipotle describes the move as its "first significant investment in a third-party technology company" since CEO Brian Niccol came on board in 2018.

The fast-casual restaurant may be moving in the same direction as Domino's Pizza, whose marketing VP Dennis Maloney once famously described the restaurant chain as "an e-commerce company that sells pizza."

The Mexican-style restaurant came through the COVID-19 pandemic in fighting trim, making heavy use of digital ordering and various delivery methods to keep cash flowing during the lockdowns. The company's expanded use of so-called "Chipotlanes," or drive-through pickup lanes, helped it bolster sales even through the worst periods of the pandemic-related economic shutdown. Chipotle restaurants with the advanced lanes outperform those without, with CFO Jack Hartung remarking "results reaffirm our strategy of an accelerated pivot toward Chipotlane sites," according to MarketWatch.

A delivery robot concept shown driving along a street outside lighted nighttime buildings.

Image source: Getty Images.

Though Chipotle executives were initially reluctant to switch to digital, according to the same source, they now appear to have embraced the model. Chipotle is now operating digital-only kitchens with no physical dining area, for example. Chief Technology Officer Curt Garner says "Nuro could change the traditional delivery model and we believe consumers are going to continue to seek options."

Nuro is an autonomous and robotic delivery vehicle start-up that is permitted to operate its vehicles on California public streets, receiving the green light from the Golden State's Department of Motor Vehicles in December 2020. Nuro's small, pudgy-looking R2 autonomous vehicle received a U.S. Department of Transportation exemption in February 2020 and was later tested in three states.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Chipotle Mexican Grill, Inc. Stock Quote
Chipotle Mexican Grill, Inc.
CMG
$1,262.06 (-2.15%) $-27.73
Domino's Pizza, Inc. Stock Quote
Domino's Pizza, Inc.
DPZ
$340.19 (-0.82%) $-2.81

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
334%
 
S&P 500 Returns
117%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.