Self driving start-up aims to replace 15 million truckers in the US and China

Chinese artificial intelligence (AI) start-up self driving (TuSimple) has deployed autonomous trucks on commercial runs between Tucson and Phoenix in Arizona and Las Vegas, Nevada, as the company prepares to expand its operations in the world’s two largest economies by next year.

Self driving start-up aims to replace 15 million truckers in the US and China

That trial programme in the US, where its two trucks transport consumer goods at speeds of up to 104.6 kilometres per hour (65mph) on their routes, is generating about US$6,600 a week in revenue and given TuSimple a toehold in the vast US freight market, said Chen Mo, the company’s co-founder and chief executive.

“Scaling up our operations boils down to two factors – capital and talent,” Chen said in an interview at TuSimple’s headquarters in Beijing. The company has its US headquarters in San Diego, California.

Chen said TuSimple, which has more than 450 employees in China and the US, plans to gradually expand its autonomous truck fleet to a total of 500 units between the two markets, which would enable it to generate about 100 million yuan (US$14.4 million) in revenue from next year.

The company, which has generated US$83 million in funding since it was founded in 2015, is now working on a new round of financing, the amount of which it has not disclosed. Chen said the company was currently burning about US$4 million a month in capital in the US and China.

TuSimple’s expansion plans underscore China’s efforts to gain leadership in developing next-generation vehicles with autonomous driving technology. Various Chinese hi-tech firms are looking to develop so-called level-four autonomous driving trucks and cars. That means these vehicles should be able to slow down, pull over or park at a safe spot if a human driver does not take control when requested, according to industry guidelines set by the Society of Automotive Engineers.

The start-up’s initiatives in the US have come at a sensitive period because of the trade war between China and the US. The current climate has heightened Washington’s security concerns over Chinese hi-tech companies doing business in the US, blocking major suppliers like Huawei Technologies and ZTE Corp from selling their main products to US entities.

TuSimple’s Chen, however, sees plenty of opportunity in the US, “where logistics costs are more expensive and there is a shortage of truck drivers of as much as 200,000”.

He estimated that an average truck driver in the US costs companies roughly US$70,000 a year, while working in three shifts per truck.

“If we succeed, about 15 million truck drivers in China and the US will be initially freed from their strenuous and dangerous work,” he said. “We hope more investors can have faith that it’s going to happen in the coming decade; that more gifted graduates can choose to work on autonomous driving as their calling; and that more universities will take part in training such talent.”