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The Roemer Report: JUNE 2016

Who's Driving The Truck?

It’s a heart-stopping mental image: A 50-ton commercial truck motoring down a highway at 65 mph, passing you in the left lane. You turn your head, look behind the wheel of the truck and see…nobody.

A topic we first broached eight years ago, which was largely panned then, is swiftly becoming a reality. Otto, a new startup created by self-driving and car industry veterans from Google, Tesla and Apple, has developed a plan to let truck drivers take a back seat. In just four months, Otto's engineers have designed a kit that turns a regular semi-truck into a self-driving vehicle. In mid-May, an Otto-customized truck completed a driverless route for the first time.

Google has been working on self-driving vehicles since 2009, so it’s not surprising the company is at the forefront of automated trucks. Since it was founded in January, Otto has already turned three Volvo VNL 780 trucks into vehicles capable of driving down the highway on their own.

Part of the quick progress comes from Otto's approach. It's not building vehicles from scratch, but rather the company's technology modifies existing trucks. They use a combination of sensors and cameras mounted on top of the cab - hardware that can steer the truck and custom software.

An automated truck potentially has a lot of pluses. Shipping a truckload of freight cross-country costs over $4,000 today. Our driver expenses represent a majority of that cost.

Plus, HOS regulations and human physiology will always limit a truck driver’s productivity. Consider: A driverless truck can operate nearly 24 hours per day, stopping only for fuel, maintenance, loading and unloading. The upshot? This emerging technology could double the output of the U.S. trucking industry and reduce operating costs by as much as 75 percent. This represents an efficiency increase of 400 percent or more.

The technology probably also allows for enormous fuel savings. The best cruising speed for optimal fuel efficiency is around 45 mph. We all know drivers have an economic incentive and strong personal desires to drive much faster. Additional efficiencies will be gained when self-driving fleets fully implement additional platooning technologies, such as those from Peloton Technology, which allows multiple trucks to draft behind one another.

But there are a number of issues and questions as well.

For starters, there will certainly be opposition to the idea, likely from labor unions and safety advocacy groups. On the other hand, shippers and motor carriers will certainly support it as it will cheapen the cost of delivery. Within the industry there are likely to be widely divergent viewpoints as well. Larger trucking companies may be more likely to support the idea since they will be better able to absorb the substantial capital outlay required to implement autonomously operating vehicles. While small fleets and owner-operators may be unwilling or unable to afford these costs.

Additionally, there are functionality and safety questions. What happens when there’s a software malfunction or system failure in a convoy of driverless trucks? Is that going to cause, at worst, a serious accident, or at best some serious downtime, disrupting delivery schedules?

And then there’s the driver issue. What role will the driver play in an automated truck and how will the job market be impacted? Already, there’s a shortage of 75,000 drivers. The figure is expected to climb to 250,000 over the next decade or so. The initial sense might be drivers will no longer be needed. But in fact, much like automated subway cars, there’s still someone technically operating the train. That likely will be the case with trucks and their drivers.

On this topic, how will automated trucks handle getting in and out of loading docks and tight spots? Will be a manual function allowing drivers to assume control?

All of these questions and issues will be discussed and debated in the coming months and years. For now, the techies will continue their work, perfecting the concept.

Otto doesn't have a price for its final hardware, but it would be a fraction the cost of a new truck.

The self-funded startup has 40 employees, 15 of them former Googlers. It was founded by a former lead engineer of Google's self-driving initiative, Anthony Levandowski, and former Google Maps product lead Lior Ron. The team just moved from a cramped living room in Silicon Valley to an office in San Francisco and is testing its trucks in multiple states, including California, Nevada and Arizona.

Otto isn't the first self-driving vehicle company to tackle trucks. In April, a fleet of trucks completed the Europoean Truck Platooning Challenge. The trucks drove in rows and coordinated speed and distance utilizing wi-fi to get the best fuel efficiency. Additionally, Freightliner is testing automated trucks in Nevada.


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The ROEMER Report  

I'm Wellington Roemer. Publisher of the Roemer Report. Since 1978, The Roemer Report has been giving trucking executives the information you need to run your business. We research the industry's metrics, politics, developments, technological and operational trends so you don't have to. Our Report saves you time by digesting key industry news into short, clear stories. - Avoiding information overload. Thank you for giving the Roemer Report your attention today, we work hard to be worth your time.

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