The Path Forward with Automated and Autonomous Vehicles
Authored by SMC³ on October 10, 2024
After more than a decade of hype around autonomous trucking, we’re now on the cusp of an inflection point. Autonomous trucking will become a widely adopted reality over the next several years, driving significant impacts in the shipping and logistics industry—and the LTL segment, in particular.
This autonomous revolution was the focus of the second installment in our four-part SMC3‘s LTL 2024 Online Education Hybrid Series. The session, “Regulating Autonomous Vehicles and the Path forward with Automated and Autonomous Vehicles,” featured expert insights on how autonomous trucking will benefit LTL shippers and how it will change (but not eliminate) jobs for drivers. The session also revealed other surprising impacts to the broader shipping and logistics industry.
Major milestones on the horizon for autonomous trucks
“We’ve all been hearing about the promise of autonomy for a long time,” said Jordan Coleman, Chief Legal & Policy Officer at Kodiak Robotics. “Where we are now is delivering on those promises,” Coleman said.
As an example, Kodiak currently carries roughly 50 loads a week with autonomous trucks that are co-piloted by safety drivers, delivering freight daily from its hub in Dallas to Houston, San Antonio, Austin, Oklahoma City, and as far as Atlanta. “These autonomous trucks have covered more than 3.5 million miles with zero at-fault accidents, which we’re particularly proud of,” he said.
In summer 2024, Kodiak did its first fully driverless run on private roads in an industrial application in Texas’s West Permian Basin. Coleman said Kodiak plans to remove safety drivers and begin doing driverless runs on public roads in the second half of 2025. Other autonomous trucking leaders like Aurora Innovation are on similar timelines to achieve truly autonomous over-the-road routes. “From there, we’ll be starting to integrate over-the-road trucking fleets,” Coleman said.
Complementing—not replacing—human drivers
To address the most contentious question first: Will autonomous trucks make human truck drivers obsolete—putting people out of jobs?
“We really view our autonomous trucks as supporting human truck drivers and not the other way around,” answered Coleman, “We want to take those jobs that nobody wants to do.”
In particular, “we see ourselves handling that long, lonely, 1,000-mile route,” he said. The major benefits and efficiencies in autonomous trucking lie in these long-haul routes. “The system is just as safe on hour one as it is on hour twelve or beyond. It doesn’t get tired, it doesn’t get drowsy,” Coleman explained.
This perfectly dovetails with the greatest concentration of driver shortages. “I think we can all agree that it’s tough to attract and retain long-haul truck drivers because it’s a tough job and drivers want to be close to home,” Coleman said.
Expanding local & regional trucking jobs (and creating entirely new jobs)
In fact, autonomous trucks have the potential to increase the number of attractive local and regional driving jobs.
Filling the long-haul driver shortage with autonomous trucks will increase LTL shippers’ overall capacity and boost fleet utilization. Coleman says this will increase the number of driving jobs, “where somebody can put in a great 11-hour day and then get home to their family, get home to their friends, make it to their kid’s football practice, etc. That’s the future we envision—these robots supporting truck drivers and helping them improve the quality of truck driver lives.”
The rapid expansion of autonomous trucking will also create new jobs in the LTL industry. Think autonomous truck technicians, autonomous truck inspectors, and safety and operational specialists who manage the remote monitoring data pouring in from these hyper-connected vehicles. “We really think it’s going to create a whole new class of jobs,” Coleman said. “In fact, we’re working with Dallas Community College on developing a curriculum for some of these new jobs.”
Technology leaders working closely with regulators
In his role as Chief Legal & Policy Officer at Kodiak Robotics, Coleman has a front-row seat to the evolving regulatory landscape around autonomous trucking. He noted that states have led the charge to establish new regulations. “I like to jokingly say we have at least 51 regulators in the United States right now,” he said, highlighting that 25 states have passed explicit legislation permitting the operation of autonomous vehicles, and several other states have passed rules or laws regarding the testing of this technology.
Autonomous trucking falls under federal oversight through the FMCSA. Coleman applauded federal regulators’ approach to this rapidly developing environment: “They’ve effectively gone out to the industry and the public at large to say, ‘Hey, we’re thinking about how we want to regulate these vehicles. We’d love your input.’”
As for tips or best practices on how to stay ahead of changing regulations, Coleman stressed transparent communication with regulators. “This is a place where you never want to surprise anybody,” he said, noting that Kodiak works closely with state and local regulators, administrators, and law enforcement organizations to make sure everyone feels comfortable with what’s coming on the horizon.
Bringing multiple business benefits to LTL shippers
Autonomous trucking promises to deliver several business benefits to LTL shippers:
- Increased efficiency = higher margins
Autonomous trucks are more efficient for a number of reasons, from less braking and more gentle acceleration to reducing out-of-route mileage and idling. “These trucks aren’t going to need to have a driver resettling in the birth and running the AC, running the heat, running their microwave, running their TV, video games, etc.,” said Coleman. “And so simply from that alone, we can really increase fuel efficiency.”
Just how much of a boost? Coleman estimates that these efficiencies could double the margin profiles for LTL shippers over a four-year period.
- Increased utilization & capacity = higher revenues
By resolving the challenges presented by driver shortages and service hour limitations, LTL shippers may see a 2-3x increase in asset utilization with autonomous trucking as well. “That’s pretty exciting,” said Coleman. “Because there’s not a trucking company we talk to that doesn’t say ‘I see a ton more freight than I can actually bid on and win because I only have so many trucks and I only have so many drivers.’”
The increased efficiency enabled by autonomous trucks that don’t get tired and don’t require mandated breaks will also bring down over-the-road shipping times. This will make LTL shipping a more appealing and cost-effective option for more time-sensitive loads. It has the potential to increase demand and help more shippers realize a boost in revenue.
- Enhanced safety = reigning in insurance and litigation costs
Autonomous trucks could eliminate the many safety issues incurred from driver fatigue, distracted driving, and other human factors. Moreover, the software continuously improves and is instantly updated for all trucks. “Every truck in your fleet can be the safest truck in your fleet,” said Coleman.
This enhanced safety will help reduce the increased insurance costs that shippers have seen over the past few years. Shippers will also see litigation costs fall—not just from fewer safety incidents. The extensive monitoring technology on these autonomous trucks will enable a streamlined, data-driven approach to incident investigation and resolution. “There will be much less of the ‘my accident reconstruction specialists versus yours,’” explained Coleman.
Impacts on other shipping modalities
The big impacts on LTL and the wider over-the-road shipping sector will drive some surprising effects across the entire shipping and logistics industry.
While some have predicted that autonomous trucking will make rail freight obsolete, Coleman said he believes it will actually reinforce a key value of rail: “You can park a rail car for a week and wait for it to fill up and send it, which leads to a cost profile that we’re never going to be able to compete with.”
But air freight will see more significant effects. By eliminating service hour limitations, over-the-road long-haul shipping times may be cut by several days—suddenly making it more comparable (and significantly more cost-competitive) than air freight. “I think there’s a real opportunity to take freight out of the air and put it on the road,” said Coleman.
The upfitting model will persist
For the near future, the upfitting model will be the main mode of deployment for autonomous driving tech. This includes upfitting both older trucks and new trucks as they roll off the line.
The next big inflection point—still a few years off—will be when OEMs start integrating the autonomous driving technology directly on the production line. “We’re excited to see that towards the latter end of this decade,” said Coleman, “But we really think we can help bring this technology to life over the course of the next 2, 3, 4 years through this upfitting process.”
What LTL shippers should be doing now
Technology transformation tends to happen slowly at first—and then all at once. “We are truly at a point where the future is now and the promise of autonomy is ripening,” said Coleman, “In 18 months, we could be driving next to a full autonomous 18-wheeler.”
For now, LTL shippers should begin thinking strategically about how they’ll deploy the tech in their fleets. Coleman explained that older trucks can be easily upfitted (though there are limitations to how old). But he also stressed that natural fleet turnover presents an ideal opportunity to upfit autonomous driving technology into new trucks.
“If you’re going to turn it over, then you’re going to want this truck to be maximized from a utilization perspective,” he said, “As you’re doing your fleet refresh, that’s the right time to go through that integration.”
Interested in joining LTL Hybrid Sessions? Register here: https://smc3.info/LTLedu