Waymo – The OM Blog by Heizer, Render, & Munson

OM in the News: Pepsi Trucks Go Driverless

A 26,000-pound box truck loaded with Doritos and Frito-Lay chips rolls out of a distribution center, bound for a Walmart store about 4 miles away. It looks like any other truck, but there is no one at the wheel, writes The Wall Street Journal (June 8, 2026).

This is one of the 35 driverless trucks PepsiCo is running on Arizona roads, marking it as the first major U.S. consumer-goods company with real-life, large-scale use of autonomous trucks on public roads.

Pepsi’s operation, using trucks outfitted with multiple cameras, sensors and computers, is on par with the technical hurdles being cleared by driverless passenger taxis from Waymo and Tesla. The firm operated with a safety driver in each truck for a few years, and started driverless runs in 2025. The trucks have had no accidents on public roads so far.

In instances where the trucks are making deliveries to stores, Pepsi employees are there to meet the trucks and unload them. Many delivery drivers have always been sales representatives too, and not having to travel with the truck allows them more time to interact with store owners to pitch them on the latest promotions.

The driverless trucks are more reliable than human drivers. The on-time arrival performance from driverless trucks reached 99%. Humans can call in sick or hit up against service limits that cap how many hours a day they can be behind the wheel. And the number of truck drivers has been constrained in recent months by new federal rules enforcing English-language proficiency..

The trucks perform best when they shuttle back and forth in repetitive trips—for instance, a 14-mile trip between a Gatorade bottling plant and storage facility. That route has fewer variables compared with routes that have more pickups and deliveries.

Pepsi employs thousands of drivers in the U.S., some represented by unions that have strongly opposed the rollout of autonomous trucks. The company anticipates retraining and redeploying some drivers to other types of work, including managing the new equipment, synchronizing the movement of people who go to the stores, or handling the unloading themselves. But ultimately, the company expects to hire fewer drivers.

Classroom discussion questions:

What are the advantages and disadvantages of these Pepsi trucks?
How will this impact the demand for truck drivers in the next 5-10 years?

OM in the News: Waymo is Repurposing its Old EV Batteries

A Waymo car drives up a hill in San Francisco.

Where do all the used EV batteries go? Alphabet’s Waymo has found a wonderful solution: recycle its old electric-vehicle batteries as storage for solar power. The plan is to reuse thousands of its EV batteries, finding a new use for the old batteries as large-scale energy-storage systems that can stash power to shore up the electric grid.

Its fleet of self-driving cars go through EV batteries far more frequently than regular electric vehicles because the autonomous ride-hail cars rack up more miles more quickly. That means batteries from its autonomous cars would be repurposed at a faster rate than those from a personal EV.

An energy storage system in Lancaster, Calif.

To repurpose EV batteries, the units are removed from the cars, tested and ultimately packed into 9-foot tall “cabinets,” which look like small shipping containers. Each cabinet contains dozens of old EV batteries.

The system captures excess solar energy during periods of low demand and eventually makes it available to consumers via the electricity network through wholesale markets where power is traded. That helps firm up the grid. The company estimates that one cabinet could power an average home for up to three months, writes The Wall Street Journal (June 4, 2026).

Each battery reused can add $8,000 to $10,000 in added electric power value. The clean energy startup is part of a budding desire for businesses to get more out of the glut of electronic waste. “To take an asset made for one purpose and use it for a different purpose—it is fairly novel,” said a company exec.

Classroom discussion questions:

Frame this as a “triple bottom line” issue as in Supp. 5 of your Heizer/Render/Munson text.
What happens to EV batteries that are not repurposed?

OM in the News: Honda to Invest $2.75 Billion in GM’s Self-Driving Cars

Honda’s investment will give the auto maker a 5.7% stake in GM Cruise.

Honda is investing $2.75 billion in GM’s self-driving car unit, for the joint development of a mass-produced fully autonomous car, writes The Wall Street Journal (Oct. 7, 2018). Auto makers and technology giants have been scrambling to plant stakes in a transportation landscape that is swiftly being reshaped by technology. Honda will work with GM Cruise LLC to develop a driverless car from the ground up that can be manufactured in high volumes and deployed globally. (GM set up Cruise as a separate business unit to draw in investors who don’t want exposure to the cyclical, low-margin business of manufacturing cars).

Honda’s decision to invest in GM’s self-driving arm reflects a culture change under way at the Japanese car maker, which long prided itself on its engineering prowess, shunning technologies developed by outside companies. One industry analyst said he expects only a handful of “winners” to emerge from the race to commercialize driverless vehicles. That prospect and the large capital outlays required to develop the technology could lead to more collaboration among automotive competitors.

Car companies have been teaming up with tech firms and suppliers to develop driverless technology. GM’s pact with Honda is a further sign that traditional auto makers will look to join forces with one another as they try to fend off Waymo and others vying to lead in a technology that could upend the transportation sector.

Fiat Chrysler has joined a BMW-led consortium to develop self-driving car technology with the aim of producing fully automated vehicles by 2021. BMW launched the partnership with Intel and Israeli car-camera software provider Mobileye. Toyota just announced it would invest $500 million in Uber to work jointly on autonomous vehicles. Uber will integrate its self-driving technology into Toyota minivans for use in Uber’s ride-hailing network.

Classroom questions:

Name other companies that are forming “alliances” ( a topic in Chapter 5).
Why are such alliances useful in designing goods and services?

OM in the News: Autonomous Cars May Not Need a Driver, But They Still Need a Good Mechanic

One of the cars being used by Waymo in the Phoenix area to test driverless technology

Waymo, one of the leading forces in self-driving technology, is enlisting the largest auto retailer in the U.S., AutoNation, to maintain and repair the growing number of driverless vehicles Waymo is testing around the country. Waymo — a unit of Google’s parent, Alphabet — is moving a step closer to putting driverless vehicles into ride-hailing fleets that would serve the general public, not just its own employees. Maintaining expensive and technology-packed self-driving vehicles is a main challenge for using them in moneymaking businesses, like ride-hailing fleets, writes The New York Times (Nov. 3, 2017).

Says AutoNation’s CEO. “In most cases, driverless vehicles in such fleets will have to be on the road almost around the clock to offset the cost of the sensors, computer chips, software and other systems that allow them to drive safely and reach their destinations without human operators. These vehicles need to be in service for hundreds of thousands of miles, much more than personal-use vehicles, to make them economically viable. To do that, you have to do much more proactive, preventative maintenance than what a normal person would do on a car.”

Because the vehicles are intended to operate without drivers, breakdowns have to be avoided and parts replaced when signs of wear first appear, not when they fail or when a warning light comes on. They need to work not 99% of the time, but 100% of the time.

Auto dealers, like AutoNation, sell cars, but a big chunk of their profits comes from servicing vehicles. They are looking for ways to become more relevant if car usage becomes more of a shared service.

Classroom discussion questions:

How is this an OM decision by Waymo?
How will the auto industry be impacted by driverless cars?