A delivery system in which the vehicles themselves coordinate their movements. Vehicles are assigned to groups based on proximity. Each vehicle communicates its location and route information to the other vehicles in the group. The vehicles in the group then know the positions and routes of the other vehicles in the group. When a delivery is requested, the vehicles in the group use this information to determine which vehicle should be assigned to make that delivery. As the vehicles move around, their proximity to each other changes. When a vehicle has moved away from a group, that vehicle may be removed from the group and assigned to a different group. In this manner, the vehicle coordination mechanism is a distributed task performed by all the vehicles.