You know what was so great about the 1970s and 1980s? You can pretty much take any topic today and relate it back to a movie from that golden age of cinema, before every film either starred a Marvel superhero or Meryl Streep. Last week, for example, we tracked down more than a dozen startups driving toward being the Uber of Trucking. It contrasted with a simpler time of being a truck driver, as reflected on the based-on-a-not-so-real story of Smokey and the Bandit. This week we return to the topic of trucking technology. Specifically, we want to look at the current state of driverless trucking and some of the interesting startups that have recently joined the race. This immediately brought to mind Stephen King’s magnum opus, Maximum Overdrive, where a comet passing by the Earth causes inanimate objects to become homicidal. A murderous big rig sporting a giant goblin face on its grill leads the charge against humanity.
Also based-on-a-not-so-real story, Maximum Overdrive does bring up one painful reality. Driverless trucks will be killers—for jobs. A few stats from the American Trucking Association to show the coming disruption:
- Trucking is a $700-billion-plus industry, representing more than 80 percent of the nation’s freight bill
- There are about 3.5 million truckers (the Bureau of Labor Statistics says 1.7 million)
- About 7.3 million people are employed throughout the economy in jobs that relate to trucking, not including lot lizards
As you probably know, driverless trucks are already here. They are being tested on highways in America and elsewhere in the world. Some are even delivering goods. In 2016, we told you ways in which you might invest in driverless truck companies now and introduced you to a few startups working on developing driverless trucks and related technologies.
Driverless Trucking on the Move
A lot has happened since then in the world of driverless trucking and autonomous driving.
The only publicly traded pure play in autonomous driving, Israeli-based Mobileye, was bought by Intel for $15.3 billion. Waymo (a separate division of Google parent company Alphabet) and Uber are locked in a legal battle over patent infringements regarding self-driving technology. At the center of the dispute is a guy named Anthony Levandowski, who left Waymo to found Otto, a driverless trucking company that Uber eventually acquired. The latest chapter in the saga has Waymo backing away from some claims while proceeding with the lawsuit, set to go to trial in October, according to TechCrunch. Messy stuff.
Meanwhile, Tesla is working on an electric version of a big rig, which one has to assume will feature some of the company’s autopilot technology. As we noted previously, German automotive company giant Daimler (ETR:DAI) is producing driverless trucks, which could hit the road as early as 2020. More recently, we learned that Nvidia (NASDAQ:NVDA), which develops powerful computing chips for artificial intelligence and other applications, is getting into autonomous driving in a big way. Nvidia will work with truck manufacturer PACCAR to develop driverless trucks, according to Mashable. Nvidia already partners with automakers like Audi and Mercedes-Benz (owned by Daimler, by the way) and also inked a deal with auto supplier Bosch for its AI supercomputer geared for autonomous driving called Xavier. (See, we’re back to Marvel mutants.)
None of this has stopped a convoy of startups from joining in the fun. Now we’ll look at five startups competing in the driverless trucking space.
Embarking on Driverless Trucking
California startup Embark, founded just last year, reportedly emerged out of stealth in February. Last month, it had its big coming out party with a $15 million Series A, bringing total disclosed funding to $17.2 million. The company is developing a Level 2 autopilot system (see graphic below) where its AI-powered computer handles the easy highway driving while handing over more complex maneuvers to an onboard driver.
Embark claims its deep neural networks have learned how to drive on their own through glare, fog and darkness. The company is testing its tech on the open roads of Nevada.
Starsky, Where is Hutch?
Another of the newest driverless trucking startups, Starsky Robotics was also founded in 2016 but only really hit the radar earlier this year around the same time as Embark. It loaded up on $3.5 million in Seed funding in March from 13 investors. Based in San Francisco, the company got a fair amount of press when it used one of its driverless trucks to haul freight about 120 miles. It filmed the feat in the video below:
Based on the video quality, these guys aren’t wasting their new money on fancy marketing but convenience store snacks. Starsky takes a different approach to driverless trucking by hiring truck drivers to work kind of like drone operators. The trucks can drive themselves—thanks to a robotics kit that can be fitted into the truck cab to operate pedals, gears and steering wheel—but rely on remote drivers for safety and some operations such as exiting a highway ramp. Among the usual job posts for computer vision and machine learning experts is commercial truck driver.
A Real Driverless Driverless Truck
Starsky isn’t the only driverless trucking startup that plans to remove people from the cab. Sweden-based Einride is developing smaller but heavy-duty driverless trucks from scratch. The T-Pod (pictured below) looks like it could serve as futuristic nemesis for a Maximum Overdrive sequel.
The driverless trucks are also electric, with a range of about 120 miles. TechCrunch reports that the T-Pod will go to work by 2020 between Gothenburg and Helsingborg, which is right around the truck’s maximum charge range. Charging stations will be maintained along the route, with as many as 200 T-Pods traversing the road.
Simply Getting It Done
China’s lone entrant on our list, TuSimple, doesn’t reflect the paucity of driverless trucking startups from that country. Indeed, research firm CB Insights has reported that $929 million was invested in driverless technology in China in just the first quarter of the year. What caught our attention is that Nvidia just bought a 3 percent stake in the company, leading an undisclosed Series B. Total disclosed funding for TuSimple is about $7 million from an Angel round in 2015.
TuSimple’s technology focuses on machine vision for developing driverless trucks. The company expects to begin commercial operation with Level 4 automation by the end of the year. Level 4 is basically full automation. The company also got the green light to test its driverless trucking Level 2 automation system on Arizona’s highways this summer.
Following Right Behind
Our list wouldn’t be complete without Peloton, which we’ve previously covered, but not since it secured a $60 million Series B in April of this year. That brings total disclosed funding to about $78 million. Investors like Lockheed Martin and Intel from the $16 million Series A in 2015 showed up with their checkbooks again. The round was led by Omnitracs, a leading fleet management company.
The Peloton system involves trucks operating in a platoon or convoy concept, with a lead 18-wheeler operated by a person with several autonomous trucks following behind like in a train. Peloton says its system can save an average of 7 percent in fuel costs per vehicle by platooning, which sounds similar to spooning but with less cuddling.
Obviously a lot of money is in play with driverless trucking. It’s also become intensely competitive, and it’s really interesting to see companies like Intel and Nvidia becoming heavily involved in autonomous driving technology. This is certainly a space where we might expect more acquisitions but exits in the form of an IPO from any of the startups featured here still seems like a longshot. Hopefully, you had your eye on Mobileye at the right time.
One firm that allows you to buy shares in startups before they IPO is Motif Investing. You can open a Motif Investing account for free with no deposit required so you are ready to buy shares of future IPOs before they begin trading.