Lior Ron is a fan of autonomous trucks. You could say that the founder and CEO of Uber Freight loves the idea of driverless trucks.
But as the late Tina Turner asked, “What does love have to do with it?”
“We’re generally seeing extremely strong demand for autonomy from shippers,” Ron told me in a recent interview. “We have a list of over a hundred shippers waiting to work on these deployments. And we’re actually in a supply crunch because we don’t have enough capacity from the autonomy providers to meet the demand.”
So maybe it’s just work, not love.
Uber Freight is partnering with Aurora Innovation and Volvo Autonomous Solutions. It recently signed a 10-year deal with Waabi, a newer entry into the level 4, high-autonomy space, to schedule loads on its digital freight network. Before Waymo Via put the autonomous trucking business on hold, Uber Freight also had big plans for it.
Improving road safety and saving money for paying drivers—not necessarily in that order—is motivating shippers to line up to take advantage of the upcoming transition to driverless transportation. Apart from a handful of pilots, autonomy today is overseen by safety drivers, who must be paid exactly as if they were still driving.
Reducing 40% of costs
Removing the driver reduces 40% of operating costs. Sure, there are trade-offs—self-driving trucks are much more expensive than human-driven ones. It’s unclear who will take over these assets, but Ron believes it will likely be carriers. They know about fleet maintenance and the right lifespan for the trucks they own.
“They’re looking for opportunities to run a more cost-effective operation,” Ron said. “And if they look out over a five- to 10-year horizon, autonomy is certainly one of the strongest opportunities for them to streamline the operation.”
Uber Freight has equipment Powerloop pools railer. Owning autonomous tractors is not in the cards.
“Never say never,” said Ron. “But that’s not our business model.”
Identifying the issues
Nothing is easy about autonomy, in part because so little is known. Leading players like Aurora Innovation and Kodiak Robotics are trying to solve these issues now that driverless autonomous technology is aiming for small-scale commercialization in late 2024.
“It’s going to take some time for them to adjust, to transition, to understand how to really redo their supply chain to accommodate a stand-alone network,” Ron said. “If it’s a transportation hub, fine, great. How do they do the first mile, the last mile? What do they need to have on both ends in terms of this?’
TuSimple built a fleet of more than 70 trucks equipped with the robot driving system and completed more than 10 million miles movement of goods. Then he realized how much money he was losing and sold most of the Navistar trucks he had bought.
“I think everyone understands that there’s a role for owning assets and there’s a role for developing autonomy. And I don’t think any of these companies have ambitions to build a huge fleet,” Ron said.
Texas as a target
Interstate 45 from Dallas to Houston is a generally flat, uninteresting, densely packed stretch of Texas highway. It is the test choice of many autonomy developers. Aurora opened I-45 as its first commercial route. Kodiak likes it too. But both companies know that neither shippers nor carriers will make much money on the 240-mile route between the two.
“It’s a great training ground,” Ron said. “If you really make the operation super smooth on both ends, you can have some success. But there are more opportunities in the longer lanes.”
That’s why Aurora is looking from Fort Worth to El Paso, Texas — 600 miles — for its next venture. Kodiak envisions Houston to Atlanta – 790 miles – as its second venture.
“We work hand in hand with the range providers to educate them about lane topology and where to make money and how to make money. What will be the cost-effective lanes and therefore work with the shippers to allow everyone to train.”
Ron compares it to intermodal where trains carry goods over long distances before tractors take over. Transport hubs make economic sense when they are 300 or 400 miles apart. The added cost of first and last mile towing for mid-mile range adds to the economics of removing the driver from the cab.
Kodiak Robotics and Berkshire Hathaway? Why not?
Berkshire Hathaway has a huge pile of cash — 157 billion dollars — on its balance sheet.
Warren Buffett’s company owns 80% of Pilot Co. with plans to purchase the remaining network of travel centers operating in 44 states.
Pilot Co. led a $125 million Series B funding round for autonomous truck developer Kodiak Robotics two years ago.
Pilot and Kodiak are working together on autonomous truck hubs, starting in Atlanta.
Berkshire Hathaway has about a 10% stake in Chinese electric truck maker BYD. (She sold some of her stake in May because Buffett he didn’t want to compete with Tesla.)
Kodiak Robotics assembled an autonomous system on a Peterbilt electric truck to show off at the Advanced Clean Transportation Expo in May.
BYD makes Class 8 electric trucks.
Kodiak wants and needs a manufacturing partner. TuSimple’s ex-partner Navistar could be available So is BYD.
That’s not something Kodiak would comment on, but if Buffett wants to further embrace autonomous trucking, he need only look at his portfolio.
Some love the new players at FreightTech 25
Several new players cracked the FreightWaves FreightTech 25 announced on Thursday at the F3: Future of Freight Festival.
Three companies in the autonomous space made the list: Plus at No.2, Einride tied at No.15 with JB Hunt Transport Services and Gatik at No.18, down one place from No.17 on the 2023 list .
On the electrification side, newcomer ChargePoint made its debut at No. 10.
Chattanooga, Tennessee-based accounting and auditing firm HHM conducted the voting. A simple points system, based on voter rankings, determined the FreightTech 25. A company scored 25 points for each first-place vote, with points dropping down to 25th place, which received one point. Companies were ranked based on total points.
“This was the most disruptive list I’ve ever seen,” said FreightWaves CEO Craig Fuller. “If you think about the business cycle from 2015 to 2022 in freight for that first stage, we’re well past that. What’s interesting about this list is how different it is from previous years. Many new names – and many names that have been on the list for many years – did not make the list this year.”
It is briefly highlighted…
TuSimple it had $776.8 million cash, equivalents and investments as of September 30largely the result of layoffs and liquidation of many of its US operations.
Hydrogen truck launch Quantron AG plans to cooperate with of Ford companies in Turkey to build a hydrogen fuel cell version of the heavy-duty F-Max.
Start of electrical infrastructure TeraWatt infrastructure will load Pepsi trucks at a new facilities in Rancho DominguezCalifornia.
Arizona federal court dismissed a lawsuit by a British electric truck manufacturer Tevva v of Canada ElectraMeccanica due to jurisdictional issues. The fight for a failed draw will likely continue.
Peterbilt takes out the trash in Portland, Oregon, waste delivery Model 520EV to City of Roses Disposal & Recycling. Yes, rival Daimler Truck is based in Portland.
RRAIwhich focuses Class 8 off-road and military autonomous effortsis working with FPInnovations on forest roads in northern Canada.
That’s it for this week. click here to receive Truck Tech via email on Fridays. And catch it latest on major events and hear from the top players at Truck Tech at 3 p.m. Wednesday on the FreightWaves YouTube channel.
Thanks for reading. I’m always interested in your comments and story ideas. Email me at [email protected].