TRANSPORTATION AND LOGISTICS BRIEFING: Waymo's self-driving truck ambitions — Samsung to invest $300 million in auto tech — Tesla to unveil semi-truck on Oct. 26 (2024)

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WAYMO CEO SAYS IT’S FIRST COMMERCIAL OPPORTUNITY MAY BE IN TRUCKING: John Krafcik, CEO of Google’s self-driving car spinoff Waymo, provided new details about the company’s plans to make money off its self-driving technology at a Bloomberg conference in New York City this week. Waymo is widely considered a leader in developing self-driving technology, but, like others in the self-driving car race, is still exploring new business models that may be enabled by the disruptive technology.

In an interesting twist, Krafcik said that Waymo may first commercialize its self-driving technology in the trucking and logistics space, rather than through ride-hailing. It’s long been known that Waymo intends to build fleets of self-driving taxis for ride-hailing, and the company started a major autonomous ride-hailing test in Phoenix earlier this year involving 500 vehicles. Waymo's much farther behind on self driving trucks — it just announced this past June that it is testing a single self-driving big-rig truck on a test track in California, with plans for tests on public roads scheduled for later this year. Despite clearly being farther behind on self-driving trucks — and the slew of potential competitors in the self-driving truck space — Waymo seems to consider it a faster path to monetizing its technology compared to ride-hailing.

Fully driverless trucks will take longer to develop than driverless cars.Completely replacing the driver in a truck likely won’t happen for decades, as driving a truck ismore complicated than driving a car and requires more training for computer systems. Additionally, truck drivers perform important maintenance tasks during long-haul trips that a computer can’t replicate.

However, Waymo could find significant near-term revenue opportunities in providing semi-autonomous systems for trucks that don't fully replace a driver. A semi-autonomous system that can at least handle the highway portions of long-haul trips would be attractive to truck operators if it can reduce fuel costs — the biggest expense for trucking fleets — and help them keep their trucks on the road longer. Semi-autonomous systems can help trucks save fuel through “platooning,” which involves multiple trucks closely following each other in a convoy to create a slipstream that reduces wind resistance and improves fuel efficiency. Peloton, an autonomous trucking startup, plans a limited commercial launch of its platooning system this year. Semi-autonomous trucks could also stay on the road longer if they allow the driver to step away from the driver’s seat while the computer system drives the truck. Current regulations place strict limits on how many hours truck drivers can drive in a given day. If a semi-autonomous system could handle highway navigation and give the trucker a break, it would allow trucks to drive longer and farther, and perform more deliveries more quickly. In comparison, the major benefits of self-driving technology in ride-hailing involve completely eliminating labor costs by replacing the driver, meaning self-driving technology probably has more short-term benefits for trucking if it can lower fuel costs and extend time on the road.

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TESLA TO UNVEIL ITS SEMI-TRUCK ON OCTOBER 26: Tesla CEO Elon Musk announced that the company will unveil its first electric big-rig truck at a public demonstration on October 26, about a month later than originally planned, Reuters reports. Musk said in April that the new truck would be unveiled in September.

Musk didn’t share any new details about the vehicle, but several of its features have already been reported in the media. The new Tesla Semi will be all-electric, with an expected range of 200 to 300 miles, which is consistent with the battery technology available today. That would make the vehicle suited for regional hauls, which make up about 30% of trucking trips in the US, according to Fleet Compete, which analyzes trucking industry data. Such regional trips are expected to increase in the coming years at the expense of longer ones, as retailers build more warehouses closer to their customers to cut delivery times and costs. The truck will also reportedly feature semi-autonomous technology, including platooning software.

The delayed unveiling though could presage further delays in manufacturing and launching the Tesla Semi. Musk has said that the truck is expected to be reach full production in 2019. However, Tesla has earned a reputation for missing its own production deadlines over the past few years. The company has been slow to ramp up deliveries of its much-hyped Model 3 — its most significant production challenge to date.

Manufacturing delays could significantly impact Tesla’s opportunity in trucking, as more tech companies, including Uber, Waymo, and several startups, are piling into the space. These other companies could make faster inroads by partnering with existing truck manufacturers to put their technology into new truck models, rather than manufacturing their own models. If Tesla faces significant delays in building the Semi, it would likely cede an early-mover advantage to these other players.

In other news…

• Researchers from Johns Hopkins successfully tested a drone carrying blood samples over a 160-mile stretch in Arizona, which is by far the longest distance a drone has carried medical supplies, according to The Verge. The researchers conducted the test, with special permission from the FAA, to determine if the samples would be damaged by traveling such long distances. Many companies, including California-based drone startup Zipline, are angling to provide drones for medical delivery services. Being able to deliver over longer distances would allow them to conduct deliveries in more rural and remote regions, where their services are in highest demand.
• Omnichannel logistics startup Parcelly and delivery courier Quiqup have launched a pilot program that uses a series of mini-warehouses across the greater London area and is specifically designed for online retailers to complete last-mile deliveries. The service uses Parcelly’s existing parcel collection network of warehouses to allow retailers to make on-demand deliveries to London customers within 60 minutes of when the order is placed. If the pilot moves into a commercial launch, it could help retailers meet growing demand among UK shoppers for faster, more convenient delivery options.
• Intel-owned Mobileye, which provides self-driving and driver-assist technology, is working with Munich Reinsurance, the world’s largest reinsurer, to make its retrofitted advanced collision avoidance system available to all of Munich’s commercial clients. The collision avoidance system is powered by Mobileye’s camera and image recognition technology, which is also frequently used in self-driving cars. The system should help Munich’s clients reduce traffic accidents and associated costs with their commercial vehicle fleets. The move could help MobilEye gain brand recognition among commercial fleet operators, which could help it sell more advanced driver assistance and, eventually, self-driving technologies to these operators down the road.