Ocado’s flagship automated warehouse ravaged by fire

Ocado fire
(PA Images)
// 20 fire engines & 200 firefighters attend blaze in Andover, which is now under control
// Significant damage inflicted on Ocado’s most high-tech warehouse
// Ocado’s shares drop over 8%
// The location accounts for around 10% of Ocado’s warehouse capacity

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Ocado’s high-tech robotic distribution centre in Andover has been severely damaged by a fire that broke out on Tuesday and continued to rage for 24 hours.

According to firefighters, the fire is now under control, but has caused significant damage to the online grocer’s flagship automated distribution centre, which is capable of processing 65,000 orders every week.

The damage included the collapse of part of its roof.

The blaze began in the early hours of Tuesday in the grid of 250,000 storage locations and over 1000 robots, forcing Ocado to suspend operations.

The fire then spread and continued to rage for more than 24 hours, eventually requiring around 20 fire engines and 200 firefighters to bring it under control.

“Once we have had time to assess the damage and prepare a plan to return the customer fulfilment centre to operation we will update further as appropriate,” Ocado said.

It also warned that the fire would put a “constraint on our ability to meet our growing customer demand”.

“There will be a reduction in sales growth until we can increase capacity elsewhere,” the retailer said.

This could put a significant dent in Ocado’s operations, as its high-tech store was fundamental in securing its landmark deal with US grocery giant Kroger.

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

Yesterday, Ocado reported a pre-tax loss of £44.4 million in the year to December 2, compared to a loss of £8.3 million the previous year, due largely to its heavy investment in new warehouses, automation technology and international partnerships.

Ocado was crowned the best-performing company on the FTSE 350 in 2018 as a result of its transformative year.

During the year, Ocado Solutions – the arm of the retailer which licenses its automated technology and software to third party companies – also secured deals in France, Canada and Sweden, solidifying its standing as an international company.

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