Latest / Minds, Bodies, and Terawatts / Walmart Spent a Decade and Billions Teaching Robots to Empty a Cardboard Box. The Box Was an Inch and a Half Too Tall, the Power Bill Tripled, and the Dog Food Still Needs a Human

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Walmart Spent a Decade and Billions Teaching Robots to Empty a Cardboard Box. The Box Was an Inch and a Half Too Tall, the Power Bill Tripled, and the Dog Food Still Needs a Human · Minds, Bodies, and Terawatts

• 0:00
  [Host] This is Minds, Bodies, and Terawatts, the show where the robot met a bag of dog food and lost. The Wall Street Journal reported Friday that Walmart's decade-long, multibillion-dollar push to run its warehouses with robots is stuck on cardboard boxes and frozen turkeys.
• 0:14
  [Guest] Walmart has more than a hundred forty thousand warehouse workers, and the Journal says the machines still can't do a lot of what those people do. Its supply-chain chief, Rob Montgomery, calls where they are right now "peak complexity."
• 0:27
  [Host] Start with the boxes. How does a cardboard box beat a robot?
• 0:31
  [Guest] Walmart has shipped in the same cardboard box for more than twenty years, with workers told to reuse them to save money. It turns out the box is an inch and a half too tall for the new machines, so Walmart is throwing them all out for a shorter one that has to be taped shut, which costs more.
• 0:50
  [Host] So the warehouse is adapting to the robot, not the other way around?
• 0:54
  [Guest] That's the pattern all the way down. The job that beat them longest is called breakpack, which just means taking items out of a case to ship one at a time. Years of tests either didn't work or cost too much, and the answer they landed on is small wheeled robots with sensors, now rolling out to more warehouses.
• 1:14
  [Host] And the turkeys?
• 1:15
  [Guest] A newly automated grocery warehouse in California, a few years ago, right before Thanksgiving. The robotic arms fumbled the big frozen birds, and Walmart routed turkeys through neighboring warehouses that still had people.
• 1:26
  [Host] If I drive a forklift for Walmart, this sounds like good news for me.
• 1:30
  [Guest] Walmart's test site in Brooksville, Florida, is what Walmart calls nearly fully automated, meaning about eighty percent of the inventory moves by machine. The rest, the big-screen TVs and the jumbo bags of dog food, still needs hands.
• 1:43
  [Host] That sounds like the robots are winning, not losing. What's the catch?
• 1:47
  [Guest] On volume they are winning, but not yet on cost. The robots come from Symbotic, a company Walmart partly owns, and the Journal's source says an automated grocery warehouse can run a power bill above eight hundred thousand dollars a month at peak, against about two hundred fifty thousand when people did the work.
• 2:05
  [Host] Triple the power bill, and I'm guessing the people who fix the robots don't work for forklift wages.
• 2:11
  [Guest] They don't. The machines break down from something as small as dust buildup, and the engineers who keep them running are paid more than the warehouse workers they stand in for. Montgomery isn't hiding any of it, either. His line to the Journal was that if they wait till perfect, it'll take too long.
• 2:28
  [Host] So back to my forklift. Does Walmart cut jobs to pay for this?
• 2:33
  [Guest] Executives told the Journal layoffs won't be needed, because warehouse turnover is high enough to do it for them. Nobody gets fired, but the person who quits doesn't get replaced, and the posting that would have been theirs goes to a machine.
• 2:46
  [Host] Montgomery also told the Journal that if sales keep growing, Walmart could need as many warehouse workers as it has today. So does anyone actually lose?
• 2:55
  [Guest] The same number of badges, maybe, but not the same hands. Walmart still needs humans to unload trailers and to fix the robots, and the fixer earns more than the stacker did.
• 3:05
  [Host] If the robot costs more than the person today, why is the person the one losing?
• 3:11
  [Guest] Because a robot doesn't take a job the day it's smarter than you. It takes the job the day it's the cheapest reliable way to get that one task done, and the line moves one task at a time. The routine stuff at Brooksville has crossed it, breakpack is crossing now, and dog food hasn't.
• 3:29
  [Host] So the question for a warehouse worker is which item they're standing behind.
• 3:33
  [Guest] And the question for Walmart is how long it can pay triple for power while it waits. Every new machine comes with a hidden bill for rebuilding everything around it. The classic case is electricity: factories had electric motors for about forty years before they got noticeably faster, because each one had to be rebuilt around the motors, floor by floor.
• 3:53
  [Host] Forty years. Walmart has been at this for ten, so where is it on that curve?
• 3:58
  [Guest] In the expensive half, retrofitting decades-old buildings that have to keep shipping while the robots go in. The cheap half is still a promise, and Walmart says its spending peaks this year and next.
• 4:10
  [Host] Give me the honest read. Did the robots lose this round?
• 4:13
  [Guest] They lost the turkeys, they stop for dust, and they're losing the dog food. Everything in a box of a predictable size they've mostly won, and Walmart's bet is that the losing list gets shorter every year while the people on it leave on their own. That's a quieter way to replace a workforce than any layoff.
• 4:32
  [Host] So the line Patrick Deglon draws in Unscarcity, the Substitution Threshold, where the cheapest reliable way to do a job stops being a person, isn't a date on a calendar. Walmart crosses it one bag of dog food at a time, with a power bill attached.
• 4:47
  [Guest] For more on where the line between human and machine labor gets drawn, and why the bill for abundance arrives before the payoff, head to unscarcity dot ai. The book is on Amazon, the audiobook is on Spotify. This has been Minds, Bodies, and Terawatts.