Autonomy, in the space of a small number of years, has become ubiquitous. The automotive industry is learning a new language and, as the playing field flattens and technological barriers to entry shift, it is also becoming accustomed to a number of new and considerable competitive threats. One could argue that, in many ways, talk of the automotive industry is passe; we are now in an era that sees mobility as uppermost, and the days of the meat-box on wheels as being preeminent have now passed.
That the technology driving the shift – or at least the discussion of the shift – towards what may or may not become ‘auto industry v3.0’ is without doubt remarkable. And within the entire debate, it is the issue of autonomous trucks that should be debated most rigorously.
Freight transportation is, at its heart, a very simple process. It involves moving a product from Point A to Point B. Historically, this was a function of the point of manufacture not being the same as the point of sale; thus, transportation enabled the growth of the former by providing access to the latter. This still lies at the heart of freight transportation.
Clearly, to the producer, there is a cost-benefit equation to resolve here. Does it pay to ship those goods? If the cost of the freight is less than the revenues that accrue from these incremental markets then, all other things being equal, it does. To maximise that advantage demands that the cost of that freight movement be minimised. Leaving aside regulatory demands, the pursuit of freight efficiency has been the driver behind almost every improvement yet seen within the commercial vehicle industry. And even these improvements can be a tough sell to what is an inherently conservative market place; the advent of telematics and EDI (electronic data interchange) have allowed huge operational benefits to accrue to those fleets that have embraced them as a part of their systems. And yet uptake of such systems is – for a number of fleets – still very much in its infancy.
Vehicle design, aerodynamics and fuel efficiency are as optimised as possible within the existing regulatory frameworks that prevail within the major markets. Telematics technology has also developed to such an extent that we are probably approaching a state of diminishing marginal returns in this sphere too.
So what does this say about autonomy and freight efficiency? Does it represent a potential cohort shift in freight efficiency like that brought about by the advent of telematics?
The examples referred to previously are seemingly very different, but are in fact united by a common theme. Vehicle efficiency reduces costs. The use of telematics – when applied in a considered fashion – does likewise. Reflecting upon the previous observation about cost-benefit analysis, it is difficult to see how any technological development that reduces input cost or improves input cost control would be seen as anything other than favourable.
Can the same be said of autonomous trucks?
There is a huge demographic issue confronting not just the transportation industry but society at large. According to UN estimates, the number of people in the developed world aged between 16 and 64 peaked in 2010; meanwhile, the number of people aged 60 and over will exceed the number of children for the first time in 2047, and that figure will more than double from 841 million in 2013 to two billion by 2050. Furthermore, according to HSBC, global potential growth will be 0.6% lower per year over the next decade compared with the past ten years as a result of these changes. In a world in which there already exists a driver shortage, things don’t look good for fleet managers.
What, then, does vehicle autonomy do to the equation? It’s a good question; there seems to be some appetite for vehicle autonomy on the part of the regulators, but we seem many years away from any sort of meaningful support for that which is termed in the popular argot the ‘driverless truck’. Autonomous vehicles still need a driver, just one that does not have to drive. Taken to a logical conclusion, it is hard to see how autonomous vehicles address a demographic issue which is essentially binary in nature. Someone driving a truck cannot, for a random example, be painting a house. This is simple opportunity cost, and it is not obviated by vehicle autonomy. The driver may get to read a novel, but s/he is still a driver and not a house painter. Nothing changes.
So where does this leave the OEMs? In not such a good place, would seem the best analysis. Autonomous commercial vehicles appear to address a very real problem with a solution that rather misses the point of the question. And so some fundamental heart and soul searching seems in order.
Why do people not want to drive trucks?
Because other better jobs are available. Because conditions at work and the attendant lifestyle are not as good as can be found elsewhere. Because, on balance, an individual who has to earn $x per month will try as hard as possible to do so in an occupation that is not simply financially rewarding but enjoyable too. Driving a truck seems to not tick this box.
There is, perhaps, a way around this problem. Truck manufacturers used to make trucks; then they began to enable their procurement, completing the first and second stages of the industry’s development. Perhaps the third stage is the acceptance – willing or reluctant – that we are fast approaching a time when the OEMs need to provide not just the means by which freight is transported, and not just the means by which those means are procured, but also the means by which those means are operated. Perhaps it is now time to start considering a truck sold on a per-kilometer basis, with that cost including the services of a driver – a driver who would also be the responsibility of the OEM.
It’s a thought that even a few years ago would have been unthinkable. Today, though, it could address a problem that the OEMs themselves are perhaps most vociferous in identifying.
This article appeared in the Q1 2016 issue of Automotive Megatrends Magazine.