Otto has just made its first autonomous delivery and you’ll be happy to know that it was a huge beer run.
To be fair, this was a world away from a single-keg for a frat party. In fact it was a delivery of 45,000 bottles of Budweiser for Anheuser-Busch from the company’s Loveland,Colorado facility to a weigh station and distribution point in Fort Collins.
Of course, you can’t let an autonomous car loose on the highways without a driver, so this commercial freight delivery inevitably had a human driver at the wheel. That isn’t going to change any time soon.
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The truck did all the freeway work, it says, and went from the highway on ramp to the exit ramp at the end of the journey. This is a big step forward for the start-up that Uber acquired for more than $700 million last year and for the world of autonomous commercial freight delivery.
Otto isn’t going for the full Level 5 autonomy, at least not yet. Of course it wouldn’t take much to combine Otto and Uber’s self-driving technology somewhere down the line to create fully autonomous trucks, but that might be a little too much for the public to deal with right now.
Instead it is focusing its efforts on taking control on the freeway, which could potentially make the freight business safer and streamline deliveries as drivers could take their mandatory rest stops on the move. Fuel consumption should also improve, as the onboard computers can run calculations that a truck driver can’t hope to match.
“By embracing this technology, both organizations are actively contributing to the creation of a safer and more efficient transportation network,” Otto co-founder Lior Ron said in a statement. “We are excited to have reached this milestone together, and look forward to further rolling out our technology on the nation’s highways.”
The trip cost just $470
Otto’s trucks have made trips in the past, but this is the first autonomous commercial delivery. Anheuser-Busch paid $470 for the privilege and it’s kind of weird that they’re telling us the price. It is also surprisingly cheap, but then this is a joint venture designed to promote the service so we wouldn’t be hugely surprised to find out that Otto has spent much more than $470 in return somewhere along the line.
It’s also a sign that Otto is bringing its plans forward, as just one month ago the company announced its intention to run autonomous deliveries next year. With a number of other companies looking to muscle in on the space, Otto may simply have decided that it has to make faster progress.
That makes sense on a number of levels. Otto intends to sell a $30,000 kit that can be retrofitted to trucks that were manufactured in the last few years with fully automatic gearboxes. That’s a limited market and if Otto leaves it too late then it could well be rendered redundant by a new wave of trucks fitted with full autonomous tech. So if it wants to make a serious mark and take a solid market share then it has to get a move on.
UberFreight could turn into the big business
The self-driving technology is just part of the Otto masterplan and perhaps the most lucrative part of the technology, in the short term at least, will be a logistics platform that matches freight with drivers and fleet managers.
UberFreight aims to slash the time it takes to connect customers with freight operators and inevitably it aims to offer the best possible price, too. But this is a crowded marketplace as well and Convoy recently raised $19 million in funding to perfect its own platform. Others have essentially offered the same service for years and will go toe-to-toe with UberFreight.
“In Uber, you press a button and an Uber shows up after three minutes,” Lior told Reuters. “In freight, the golden standard is that it takes five hours of phone calls to find your truck. That’s how efficient the industry is today.”
So Otto has a number of irons in the fire, but it’s reputation rests on the autonomous technology that is the driving force behind the company. So this beer run was a big deal for the fledgling firm and we hope to see some rapid progress in the coming months.