GUANGZHOU, China — As the hype over self-driving vehicles begins to wear a bit thin, it looks like the technology will come to trucks more quickly than passenger cars.
Chinese autonomous driving company Pony.ai, which also has an office in California, has focused on applying the technology to passenger vehicles. Its latest funding round in April brought in $50 million, according to Crunchbase.
In the months since, two companies that also straddle China and California but focus on self-driving trucks have brought in at least twice the amount of capital. TuSimple has raised $120 million since June, while Plus.ai raised $200 million in August, according to Crunchbase.
“Overall, the funding situation for us (has) definitely cooled (down) a little bit, but definitely not dried up,” James Peng, co-founder and CEO of Pony.ai, said Tuesday at CNBC’s East Tech West conference in the Nansha district of Guangzhou, China. Peng noted the company has focused more recently on strategic partnerships.
As for trucks, Pony.ai announced in April the company had been testing autonomous driving for 16 weeks with a 10-person team. No further details were available when contacted this week by CNBC.
Pony.ai is testing nearly 30 self-driving passenger vehicles in Nansha and they are able to navigate rush hour traffic, Peng said on Tuesday.
Speaking on the same panel, Nasdaq Asia-Pacific Chairman Robert McCooey then jumped in. “Isn’t, at the end of the day, the nirvana is not autonomous driving vehicles for us. It’s long-haul trucks and things of that nature,” he said.
“That’s where the real benefit is.”
TuSimple self-driving truck
In the U.S. alone, revenues from the trucking industry rose to $796.7 billion in 2018, up from $700.1 billion the previous year, according to the American Trucking Associations. Trucks moved more than 70% of the country’s freight.
When fully realized, self-driving trucks will reduce the cost of hiring drivers that are required by law to take regular breaks
A major factor for businesses in choosing self-driving trucks is greater fuel efficiency, which cuts fuel costs by at least 15%, according to Plus.ai.
“There’s no question that autonomous trucks will be ready before autonomous cars,” Plus.ai COO and co-founder Shawn Kerrigan said in a statement to CNBC. “Our entire ecosystem of partners from tier 1 suppliers, to truck makers, to regulators and shippers have all shown tremendous interest and support in helping us realize the goal of becoming the first to commercialize autonomous trucks.”
The ability of companies to actually use self-driving trucks or individuals to use self-driving passenger vehicles still relies on government regulation. Autonomous driving technology is also broken into different levels. Some operate more as driver assistance, rather than fully capable of navigating a vehicle without a human.
TuSimple already has 18 contracted customers in the U.S. from which it earns revenue by hauling goods, CEO Mo Chen said in a statement to CNBC. “We have been very fortunate that we have more demand than supply, and future customers are very interested in learning more about autonomy.”
Other companies that were exploring so-called robo-taxis or self-driving passenger vehicles are also taking a step back.
In Daimler’s assessment of the business case for self-driving technology, CEO Ola Kaellenius told journalists earlier this month that commercial vehicles for long-haul freight routes would be a more likely use case, according to a Reuters report.
“There has been a reality check setting in here,” he said in the report.