Tesla’s Master Plan Part Deux and the Future of Line Haul deliveries

Source: Mercedes-Benz

Source: Mercedes-Benz

Genius, Blowhard, Bond-Villain extraordinaire Elon Musk, depending on your point of view, published his Master Plan Part Deux for Tesla. In general the manifesto was in line with the assumed direction of the industry - fully autonomous cars, autonomous commercial vehicles, and the ability for your Tesla to drive other people/cargo around for money while you are not using the car.

From a line-haul transportation perspective, self driving cars offer enormous potential as the freight travels long distances across freeways where everyone is moving in the same direction at the same speed and there are no pedestrians. The major technical problems have already been solved for this type of driving and from an economic, environmental, and quality of life perspective there are significant benefits:

Safety: From the USA National Highway Transportation board:

In 2014, 85 percent of the large trucks involved in fatal traffic crashes were heavy large trucks (GVWR > 26,000 lbs.). In 2014 there were 3,903 people killed and an estimated 111,000 people injured in crashes involving large trucks. In the United States, an estimated 438,000 large trucks were involved in police-reported traffic crashes during 2014.

Autonomous vehicles can constantly monitor and adapt to changing road, traffic, and weather conditions. Fatigue and bad decisions by human drivers can be eliminated and have a massive positive impact on road safety.

Reduced Environmental Impact: With autonomous vehicles there would be fewer cars on the road reducing the stress put on road infrastructure. Autonomous vehicles also allow for “platooning” where a convoy of vehicles travel together with the driver in the lead vehicle setting the pace and route while the other trucks follow behind automatically. A wireless connection keeps their acceleration and braking synchronized. By staying together, wind resistance is reduced which leads to increased fuel efficiency.

Increased Efficiency: Autonomous vehicles will reduce road congestion. Trucks could travel 24/7 and would not be required to take breaks. Vehicle to vehicle communication can be leveraged to set speeds, avoid congestion, and improve fuel efficiency.

Last mile deliveries, however, which require navigating the complexity and chaos of cities is a whole other ballgame. Chris Urmson, a Project Director for Google hinted that a fully autonomous self-driving car (no steering wheel or brake pedal) may not be available for 30 years, which is light-years away in the technology world.

How quickly can we get this into people's hands? If you read the papers, you see maybe it's three years, maybe it's thirty years. And I am here to tell you that honestly, it's a bit of both...this technology is almost certainly going to come out incrementally. We imagine we are going to find places where the weather is good, where the roads are easy to drive — the technology might come there first. And then once we have confidence with that, we will move to more challenging locations.

Hitting the Road

In the short term, long distance intercity transportation will likely involve assisted driving, similar to how autopilot technology is used in planes. A hybrid approach could be rolled out for truck convoying where the lead truck has a driver and and the rest of the fleet is fully autonomous.

Further out (but not too far) fully autonomous truck fleets could shuttle freight between cities with local drivers taking over at central depots close to the freeways to make the final deliveries. The final delivery portion could be “uberized” where drivers only do local pick up and deliveries to/from central depots in cities. Imagine the following scenario: after a truck is loaded at a warehouse, a driver manually drives the truck to a central depot close to the freeway. The trailer is then attached to an autonomous truck and is driven to the destination city’s depot where another driver will make the final delivery. The autonomous truck can drive non-stop to it’s destination. A journey from Chicago to Miami which currently would take a human driver a minimum of 31 hours to complete due to hours of service regulations would take a fully autonomous vehicle 20 hours to complete. Local drivers can make many pick ups and drop offs from the central depots. In the longer term, the entire end to end logistics process would be autonomous, from truck loading at the origin warehouse to truck unloading at the destination warehouse.

The Human Impact of Self Driving Trucks

Self-driving trucks would also put a lot of people out of work. In the U.S., one of the most common jobs are truck drivers:

Source: NPR

Source: NPR

According to the American Trucker Association, there are 3.5 million professional truck drivers in the U.S and the economy depends on trucks to deliver nearly 70 percent of all freight transported annually. In addition there is a large number of people employed in industries that serve the truck drivers - truck stops, motels, and restaurants. There are entire communities on truck routes that exist primarily to serve the trucking industry. Trucking jobs are also well-paid and are one of the last middle class jobs where a higher education is not required. As the software evolves, an optimal balance will be achieved between speed and efficient travel which will increase trucking companies profits and reduce transportation costs. This will be bad news for truck drivers. Large truck companies will layoff truckers and replace their fleets with autonomous trucks. Small companies may not be able to afford self-driving trucks and will be forced to operate in niche markets or close their business.

While truckers will clearly be negatively impacted by self-driving cars, the livelihood of the general population will be improved. Under the current system, safety legislation have always worked under the assumption that accidents and fatalities would happen, so regulation was constructed to reduce the frequency and severity of accidents. Due to autonomous car technological innovations, the mindset can shift to preventing the accidents from ever happening. Self-driving trucks will not require rest or breaks, can be lighter and faster and free from human errors. Self-driving trucks won’t get distracted, won’t look at phones, and won’t do drugs or alcohol. Autonomous trucks have the potential to bring about a major reduction in severe injuries and fatalities. The trade-off is that millions of good jobs will be lost.

While the technology may not be that far off, regulation will lag behind, unions will protect their member’s interests, and incumbent industries from auto insurance to oil companies will do everything possible to protect their short term profits. However, due to the crucial benefits of improved road safety, increased fuel efficiency, and a reduced environmental impact, widespread adoption is inevitable. It is no longer a matter of “if”, it's just a matter of “when”.

I cover forward-looking topics that are relevant for everyone interested in the future of logistics. You can read more articles here or sign-up for a free monthly newsletter here.