Fire extinguished at automated complex of Britain's Ocado

Roman Schwartz
February 10, 2019

The setback for Ocado, which has warned that sales will be hit as a result of the blaze, comes amid the firm's transformation plan to build robot-operated warehouses for retailers across the world.

Chief Fire officer Neil Odbin from Hampshire Fire and Rescue has already revealed that the fire has spread into a second building on the site and efforts to extinguish the blaze are hampered due to the internals and dangers within the multi-million-pound warehouse.

It added: "There will be a reduction in sales growth until we can increase capacity elsewhere".

Ocado said part of the roof collapsed overnight, but it confirmed no members of the Ocado team or the public were injured. "It's an incredibly hard fire to get into because of the nature of the building". The deal entails Ocado supplying Kroger with 20 automated warehouses, and when it was first announced, Ocado share prices skyrocketing 44 per cent - equating to around £2 billion.

Hampshire Fire and Rescue Service (HFRS) said "four of its firefighters had been treated for slight smoke inhalation" as they battled to bring the inferno under control.

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Ocado said the fire, which started in a corner of the ambient grid, caused substantial damage to the majority of the building and its contents.

But the firm stressed it has comprehensive insurance for the property, stock and equipment and for business interruption losses. Roads around are the site were opened, although firefighting operations continued. Fire crews are likely to remain at the site for weeks.

The grocer has other warehouses, including in Hatfield, Hertfordshire, which have been unaffected.

The five-story, 240,000-square-foot warehouse opened in 2016 and provides about 10 percent of capacity for the food delivery business. It typically handles more than 4,000 orders a day, using hundreds of robots to select groceries to be loaded on trucks and delivered to homes across southern England.

Ocado has been emphasizing expanding its technology licensing operation rather than its United Kingdom retail business, and the share-price decline "seems a big overreaction", Sanford C. Bernstein analysts led by Bruno Monteyne said in a note.

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