Walmart invests record $4.51B in Canada, divests truck fleetWalmart invests record $4.51B in Canada, divests truck fleet

Walmart Canada is ramping up its expansion and unloading its trucking operations to an outsourced provider, the company said Thursday. The global retailer said it plans to invest about $4.51 billion ($6.5 billion Canadian) during the next five years as it seeks to open “dozens of new stores across the country.”

Mississauga, Ontario-based Walmart Canada also said it has agreed to sell its transportation fleet to Canada Cartage, which it described as the largest provider of fleet services in the country. Terms of the sale, which a Walmart spokesperson told Supermarket News was slated to close in the coming weeks, were not disclosed. In a statement, Canada Cartage said it would operate the fleet as a dedicated operation to ensure continuity.

Biggest news for grocery?

The announcement signals increasing pressure on other Canadian grocery operators, which include the “big three” — Loblaw, Sobeys, and Metro, along with various independent and regional operators. Data from 2022 shows that Walmart Canada ranked 5th in grocery market share in Canada, capturing an estimated 7.5% of grocery sales, according to Statista. Loblaw was No. 1, with 29% of sales, followed by Sobeys/Safeway (21%), Costco (11%), and Metro/Jean Coutu (10.8%).

Walmart’s expansion plans also come as the Canadian government has been taking a closer look at competition in the grocery sector and its impact on pricing. Canada’s Competition Bureau in 2023 concluded that consolidation in the industry has minimized competition, and it has continued to investigate the competitive landscape in the country. Last year the major retailers also agreed to a code of conduct aimed at keeping grocery prices affordable.

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More details:

• Walmart’s planned investments in Canada include two new Supercentres in Ontario set to open this year—one in Mississauga this summer and another in Oakville toward the end of the year. In addition, three new Supercentres are planned for Alberta by 2027 in Calgary, Edmonton, and Fort McMurray. The company currently operates about 400 stores in Canada, the vast majority of which are Supercentres offering full grocery assortments, along with a handful of Walmart discount stores offering mainly general merchandise

• The company also plans to open what it described as its “most advanced” distribution center this spring in Vaughan, Ontario, which is part of its overall effort to upgrade its supply chain in Canada, Walmart said

• The new investments follow a $2.43 billion (about $3.5 billion Canadian) investment announced in 2020 that resulted in the modernization of more than 180 stores, four new stores, two store relocations, and four new distribution and fulfillment centers, in addition to investments in building the Vaughan DC

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• The announcement also comes as Venessa Yates takes over as president and CEO of Walmart Canada, succeeding Gonzalo Gebara, who the company said is returning to Argentina to be with his family and pursue other interests. She most recently had been senior VP and general manager of Walmart+. In addition, Walmart Canada named Steve Schrobilgen, a 35-year veteran of Sam’s Club and Walmart U.S., as its new chief operating officer

In their own words

“Walmart Canada is on an ambitious growth journey to serve even more Canadians – better and differently than ever before. This $6.5 billion investment is the largest we’ve made in Canada towards expanding our footprint since we first arrived here 30 years ago.” — Gui Loureiro, regional CEO, Walmart Canada, Chile, Mexico and Central America