Walmart + DroneUp Double Down on Dallas
PA portable benefits update, recession unlikely, Tesla finishes up restaurant
We’re starting the week off with some great news for the economy, good news for Dallas-based drone delivery heads and PA gig workers, and then some funny news for anyone that’s ever wanted to eat in a spaceship while their Tesla charges.
Today’s edition is brought to you by Gigs.
Today:
Walmart & DroneUp End Aerial Deliveries in Three States
Portable Benefits Show Promise in PA
Art Time | Tesla Restaurant Nears Completion
Economic Conditions Strengthen
AUTONOMY | Is Dallas America’s Drone Delivery Capital?
Walmart and DroneUp are ending drone delivery services at eighteen hubs across Tampa, Salt Lake City and Phoenix. As part of the cut back, DroneUp, which counts Walmart as a major investor, is also slashing its headcount by 70, representing about 17% of its workforce. Going forward, the companies will maintain fifteen delivery hubs: one by DroneUp’s HQ in Virginia Beach, three near Walmart’s Bentonville headquarters, and eleven in Dallas. Currently it costs DroneUp about $30 to make a delivery, but it’s looking to drive that down to $7 a pop, thanks both to a BVLOS waiver that seen pilots operate up to 40 drones per hour and a forthcoming new drone model that can travel 60 miles per hour and sports a 30 mile range.
The Big Picture: This was a relatively quick retrenchment for the companies, which only brought drone deliveries to Arizona and Florida in December 2022, a year after first launching in Arkansas. Dallas’ permissive regulatory apparatus, combined with its endless low-density sprawl, has made the area a real powerhouse for aerial deliveries. Back in January, Walmart turned to Zipline and Alphabet’s Wing to expand its drone options in the DFW. Those two players have proven themselves to be real tech leaders, having also just scored FAA approval to operate beyond the visual line of sight (BVLOS) in the Dallas region, a major obstacle that’s been seen as a hindrance for viable commercial operations.
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POLICY | Pennsylvania Portable Benefits Pilot Shows Promise
DoorDash and Stride Health have been piloting a portable benefits program in Pennsylvania, with 4,400 Dashers signing up for health insurance, vision insurance, dental insurance, retirement, paid time off, and emergency savings funds. So far, 91% of Dashers say the program is good for them, and 90% support the enabling legislation. 23% of eligible Dashers have enrolled thus far, receiving an initial deposit of $100, plus additional matching funds depending on eligibility and Dashing activity. By the end of July, over $440,000 had been disbursed by DoorDash to participants, of which $162,000 has already been spent.
The Big Picture: Traditionally, worker benefits are tied to their employer, which made sense in a world where folks worked for a single company for many years at a time. This new portable benefits model lets gig workers keep their benefits even if they shift platforms, meaning that just because Jane Courier swapped from DoorDash to Instacart, she doesn’t have to lose her healthcare or accrued PTO. For this initial pilot, which runs from April to September, DoorDash is contributing 4% of each participant’s earnings to the portable benefits savings account. To be eligible, Dashers must earn $1,000+ pre-tip in the first three months of the program and complete 100+ deliveries from PA merchants. That’s a sweet deal for the gig platforms, since traditional employers usually spend another 42% of wages on benefits. Other states, like Utah, are also exploring portable benefits.
ART TIME | Tesla Restaurant Nears Completion
We first broke the news that Tesla’s inaugural restaurant cum charging hub cum drive-in-theater had broken ground, back in September of last year. The structure is now nearing completion, although it’s not exactly looking handsome. We sneaked this peek during CicLAvia, an event way greener than any ol’ EV.
ECONOMICS | Recession Not Likely
Good news — Goldman Sachs’ economists think we are not headed to a recession, with the bank lowering the odds of such an event occurring from 25% to just 20%. If the next jobs report, set for 9/6, looks good, the bank will likely reduce the odds all the way down to 15%. Retail sales value rose last month by the most since the beginning of last year, while last week’s employment data showed the fewest applications for unemployment benefits since early July. Goldman Sachs is now “more confident” the Federal Reserve will reduce interest rates following its September meeting.
The Big Picture: Retail sales are looking particularly good, up 1% in July, the most in one and a half years. Hiring in the restaurant industry remains robust as well, with entry level wages hitting $19.05 an hour, up 8.4% YoY. The situation is a bit choppier on the tech side of things, with startup failures rising 60% in the last year, with VCs still hesitant to write the big checks necessary to keep some cash-burning upstarts alive. Some companies, like returns specialist Loop, are instead turning to big cutbacks to keep the lights on. Larger tech cos like Cisco and Intel are also cutting back, albeit not at the brutal pace seen in 2022.
A Few Good Links
Uber returning to Denmark after seven year absence. Zomato launches group ordering. Wingstop expands in UK, Pizza World across Florida. Amazon Warehouse rebrands as Amazon Resale. Domino’s launches ad campaign with highly relevant star Simon Cowell. Apartment construction picks up, but retraction expected. GM cuts software jobs. Amazon may make Amazon Pay a separate app in select markets. Polestar 3 may be make or break for company. Chili’s embraces barbell pricing. Circle K may swallow larger competitor 7-Eleven. VP Harris targets price gouging. Ikea embraces inventory drones. Gogoro starts bike-taxi pilot with Rapido. Walmart overtakes Pepsi as top private trucking carrier. BurgerFi eyes bankruptcy. Indonesia cracks down on e-commerce.
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