Online grocer Webvan Group Inc. is shutting down its service in Dallas, leaving it with only nine regional centers.
"While we regret the impact this decision has on our employees and customers in the Dallas Area, we firmly believe that this is a necessary and right step for the long-term viability of Webvan," George T. Shaheen, chairman, president and chief executive officer of Webvan, said Tuesday.
The Dallas closure will allow Webvan to focus on its remaining markets in Atlanta, Chicago, Orange County, Calif., Portland, Ore., Sacramento, Calif., San Diego, San Francisco, Seattle and Los Angeles, the company said.
Webvan moved into Texas territory after it acquired HomeGrocer.com in September for about $1 billion in stock. About 220 people work for Webvan in Dallas.
Webvan has been retooling its business over the last year as it competes head-to-head with other online grocers such as Peapod.com. In November, Webvan announced it would begin charging $4.95 for orders totalling $75 or less. Orders over $75 continue to be delivered free of a service charge.<
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