TuSimple, Penske and Navistar Partner on Autonomous Trucking Ecosystem

Recently, TuSimple, a predominant startup focused on revenue-generating autonomous trucking, announced partnerships with Penske Truck Leasing and Navistar to develop factory-fit self-driving commercial trucks. The partnerships enable TuSimple to create an ecosystem around its solution, helping it build its autonomous fleet and accelerate the growth of its business. TuSimple plans for its SAE Level 4 trucks to be commercially available for nationwide delivery in the United States by 2024.

As TuSimple’ s Original Equipment Manufacturer (OEM) partner, Navistar is responsible for manufacturing and hardware integration, and in return will take a minority stake in TuSimple. The autonomous technology company is thought to be the first to enable autonomous factory-fit trucks as opposed to previous retrofitted examples, such as technically modified Peterbilt trucks. Examples of modified vehicles include Waymo and Embark. The OEM build will enable software and hardware to better withstand security risks and wear and tear of vehicles and enhance seamless operations.

A key element of operation for any truck fleet is ensuring vehicle uptime. Penske will play an essential role in supporting the TuSimple fleet, with access to its 750 existing service facilities across North America. Penske provides both 24/7 roadside assistance and preventative maintenance of TuSimple’ s automated trucks. TuSimple plans to roll out its Autonomous Freight Network (AFN) in three phases—the route network will be expanded to Dallas, Houston, and San Antonio by 2021, Los Angeles and Jacksonville by 2023, and nationwide shipping by 2024.

Competition in the autonomous vehicle industry is high and other companies are seeing growth and expanding pilot testing into new areas. Class 8 leader Daimler acquired a majority stake in Torc Robotics, continuing to develop its “Highway Pilot” autonomous technology, claiming it is already advanced enough for use on public roads. PACCAR is continuing to test its autonomous technology on its 242-acre campus and look to strengthen partnerships with Peterbilt and Kenworth. Alphabet-owned Waymo announced expanded testing routes into New Mexico, Arizona and Texas throughout 2020. The company is looking to partner with OEMs and Tier 1 suppliers to integrate autonomous technology into the next generation of Class 8 trucks.

Sustaining a business in this industry requires a vast amount of capital, as funding is critical for the commercialization of a company’s technology. Failing to do so means companies will struggle to survive. Starsky Robotics, for example, failed to secure sufficient funding and was forced to shut down earlier this year. To date, TuSimple has received US$298 million, including investments from UPS, Nvidia, and Chinese technology company Sina. TuSimple also hired Morgan Stanley to help raise an additional US$250 million, enabling continued competition with potential rivals.

The fiercely competitive nature of the autonomous trucking industry forces companies to continue to innovate and further develop their business strategies to attract investments from industry leaders. Companies need to be able to monetize their service and attract strategic partners to remain viable in the market. TuSimple has succeeded by signing agreements to carry revenue freight for UPS and McLane Co. on routes between Arizona and Texas.

Companies will need an effective long-term strategy. The development of a strong partner ecosystem is a must to leverage existing infrastructure and ensure the scalability of their technology. Multinational companies will need to make adjustments in each market to create partnerships that address the needs of a local market. Regulatory compliance varies widely, and some governments, unions, and communities may impede the introduction of autonomous driving technology on public roads. These rules and restrictions may vary at the city, state, or country level and companies will need address this in a detailed manner.

Longer term full autonomy will need to take into account an alternative to regular fueling/Internal mbustion Engines (ICE). Early efforts have been made, including the limited delivery of the eCascadia in the United States. However, range is still very limited. Other options for long-haul include Nikola and Daimler’s efforts to alt-fuel heavy-duty vehicles. It is not expected that the fully autonomous commercial vehicles of the future will be powered by traditional engines.