Going Fully Autonomous in Texas
April 7, 2024
This Week in The Autonomy Economy, The Road to Autonomy Index declined 0.96%, Aurora and Kodiak are preparing to go fully autonomous in Texas, Walmart opened their optimization software to 3rd parties and Apple is looking to pivot from cars to robots as Tesla prepares to introduce a robotaxi on August 8th.
Waymo continues to extend their lead in autonomous vehicles as the company announced an autonomous delivery partnership with Uber Eats. From delivering passengers safely to their destination, to delivering food, Waymo is on the verge of becoming a verb. Waymo’s are even becoming part of wedding ceremonies.
Autonomy is here. Autonomy is becoming a business and soon it’s going to be an economy that we call the Autonomy Economy.
Apple, Uber, Walmart and Waymo parent Alphabet are The Road to Autonomy Index component companies
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What’s Moving the Markets
Going Fully Autonomous in Texas
Later this year in Texas, Aurora and Kodiak will begin operating paid autonomous trucking operations on public roads. Marking a major step in the development and commercialization of autonomous trucks. When their trucks hit the road, it will signal the beginning of the autonomy economy in Texas.
Texas is leaning into innovation and technology, the backbone of the autonomy economy. It’s paying off as private sector companies are creating new high-paying jobs in the state. In 2023, Tesla boosted employee headcount by 86% to 22,777 in Austin. As a result, Tesla is now the largest employer in the city.
Tesla builds vehicles, robots and autonomous driving software. The company is creating jobs, even as they automate an introduce a revolutionary “unboxed” production system for the manufacturing of vehicles. Similarly, both Aurora and Kodiak are going to create jobs as they scale up their autonomous freight networks in Texas.
Texas is one of the most important logistical hubs in North America. In 2022, the Texas’ freight system moved 3.4 billion tons of freight, valued at $3.1 trillion – the largest value of freight moved off all states.
From 2022 to 2050, freight moved annually in Texas by trucks is expected to increase 92% in value (inflation-adjusted dollars) and 52% by weight according to the National Transportation Research Nonprofit (TRIP).
As freight volumes increase in Texas, the business opportunity for Aurora and Kodiak grows. Autonomous trucks are good for Texas’ economy. Autonomous trucks will shore up the supply chain while they continue to create high-paying jobs.
Texas is home to 66,000 trucking companies. The trucking industry employees 1 in 16 Texans paying wages that exceed $22.5 billion with an average industry salary of $45,000. Jobs in the autonomous trucking industry will lead to increased salaries, benefiting families and the Texas economy.
We are at the dawn of the autonomy economy in Texas.
If you are interested in learning more about Aurora and Kodiak, we would recommend the following podcasts:
- Building an Autonomous Trucking Business, A Conversation with Don Burnette, Founder & CEO, Kodiak Robotics (March 14, 2023)
- The World’s Best Product is a Very Profitable Product, A Conversation with Sterling Anderson, Co-Founder & Chief Product Officer, Aurora (November 14, 2023)
Our take: Texas is the Capital of Autonomous Trucking. A good regulatory environment combined with large freight volumes is leading to job creation.
Tesla is a The Road to Autonomy Index component company
Walmart Route Optimization Cloud
Walmart recently announced the company has opened its AI-powered route optimization software to 3rd party parties. The trend of logistics companies opening their platforms and selling excess capacity along with institutional knowledge is a trend that is only going to accelerate as more of the supply chain becomes automated.
Add autonomous trucks into the mix and you have the makings of a platform that could play a critical role in the future of the automated supply chain.
Our take: Walmart will play a very large role as the supply chain becomes automated.
Walmart is a The Road to Autonomy Index component company
An Apple a Day Kept the Car Away, But Not the Robots
Could a home robot be the next big thing for Apple? That is what Bloomberg reporter Mark Gurman is reporting. According to Mr. Gurman, Apple is working on developing a robot that can follow individuals around their home. Paging Rosey the Robot from the hit TV series The Jetsons.
Are you ready to have a robot in your house that follows you around? Listens to your conversations? Watches you? Apple thinks you might be ready. After all, they will market the robot under the guise of privacy. But truly, how private would your interactions in the home be with a robot following you around?
First the car and now the robot. Apple is clearly trying to find the next big thing to re-accelerate revenue growth and diversify hardware revenue. The Vision Pro with a $3,499 price tag has not exactly taken off to become the next big thing yet.
The market for the Vision Pro appears to be limited. This could change as Apple introduces lighter and more affordable versions of the headset, but for now it’s a niche product, not a mainstream product.
According to Morgan Stanley Research, Apple’s bill of materials for the Vision Pro is $1,480. Minus marketing costs, the Vision Pro has a 40% margin.
While the margin is healthy and consistent with Apple’s historical hardware margins, it’s not going to have the market impact the Apple Car would have had on Apple’s business.
The Apple Car would have been the next big thing. The Apple Car would have redefined Apple for the generation that knows the company for the iPhone, not the iPod.
Does the next big thing even exist inside of Apple? That is the question investors are starting to ponder. Moving into robotics could wind up being another distraction for Apple if the program does not work out and become the next big thing.
Our take: Apple has to focus. Apple is adrift at sea while their biggest Mag7 (Magnificent 7) competitors lap them over and over again in the development of large language models.
Apple is a The Road to Autonomy Index component company
Ghost Autonomy Shuts Down
Effective, April 3rd, Ghost Autonomy, an autonomous driving startup that raised $220 million shut down global operations citing the current private market investment environment.
The path to long-term profitability was uncertain given the current funding climate and long-term investment required for autonomy development and commercialization. We are exploring potential long-term destinations for our team’s innovations.
– Ghost Autonomy Statement (April 3, 2024)
While Ghost citied difficulty in fundraising, private market investor interest in funding autonomy and autonomous driving is healthy. Investors are currently interested in warehouse automation and autonomous trucks, not new passenger autonomous vehicle start-ups as the markets are consolidating around Wayve (private market), Waymo (public market) and soon perhaps Tesla (public market).
If you are interested learning what Ghost was building and what their plans were for commercialization, we would recommend the following podcast:
- Advanced Technology is Invisible, A Conversation with John Hayes, Founder & CEO, Ghost Autonomy (May 16, 2023)
Our take: We expect consolidation in the passenger autonomous vehicle sector is only going to accelerate over the coming quarters.
Waymo parent Alphabet is a The Road to Autonomy Index component company
Social Buzz
Delivering Uber Eats Autonomously
On April 3rd, Waymo announced they have expanded their partnership with Uber. Individuals placing Uber Eats orders in the greater Phoenix area (225 square miles) can now have their order delivered autonomously.
As Waymo scales up their Uber Eats delivery operations, be on the lookout for potential new vehicle platforms. Could Waymo soon to opt to use a smaller vehicle platform dedicated solely to delivery? Could this be what Stellantis CEO Carlos Tavares hinted about in a February 24th interview with TechCrunch?
When you reach the destination, how do you take the parcel out of the van?. This has been a point of discussion that doesn’t seem easy to solve and we are now upgrading our collaboration deal with them to take that into consideration.
At the same time, we understand their needs and there are a lot of things that we can do for them in terms of engineering. But I would say that the partnership with Waymo is getting deeper. And I think, more exciting.
– Carlos Tavares, CEO, Stellantis as told to TechCrunch
Our take: Uber is going to become the Visa and Mastercard of mobility. Dara Khosrowshahi has done a brilliant job refocusing Uber on its core strength — being a platform.
Waymo parent Alphabet and Uber are The Road to Autonomy Index component companies
Love, Marriage and an Autonomous Vehicle
She says I do, and he books a Waymo. The wedding industry is a major economic engine. In 2023, the global wedding services market was valued at $179.23 billion and it is projected to grow to $647.39 billion by 2032 for an annual compound growth rate of 15.34%.
Incorporating autonomous vehicles into the wedding services market will not move the needle, but it could impact the wedding transportation market. The average U.S. couple spent $1,100 on wedding transportation in 2023. Adding autonomous vehicles into the mix could potentially lower the costs of traditional livery services while increasing the buzz factor of a wedding.
Would you incorporate an autonomous vehicle into your wedding planning? Let us know by replying to this email.
Our take: It’s only a matter of time until autonomous vehicles are widely considered when booking wedding transportation. After all, a wedding is an experience. In the words of Walt Disney, “Plus It”. After all you might only get married once.
Waymo parent Alphabet is a The Road to Autonomy Index component companies
No Tesla FSD in Europe?
Rohan Patel, Vice President, Public Policy and Business Development, Tesla stated on X that the updated EU DACS (Driver Control Assistance Systems) regulations could limit the use of FSD in Europe. What impact would this have on Tesla’s business is yet to be determined, but it is something to watch as Tesla scales Supervised FSD globally.
Our take: The regulatory environment surrounding autonomous vehicles and autonomous trucks is one of the most important areas to pay attention to as autonomy scales globally.
Tesla is a The Road to Autonomy Index component company
Tesla to Unveil Robotaxi on August 8th
Elon Musk announced on April 5th that Tesla will be unveiling their long-awaited robotaxi on August 8th. The announcement is a clear indication that Tesla is doubling down on autonomy following the introduction of FSD 12.
Over the coming weeks, we are going to dive deep into what a Tesla robotaxi could look like and what the overall impact on the market could be when the robotaxi is introduced.
Our take: The autonomous vehicle market is about to undergo a major change.
Tesla is a The Road to Autonomy Index component company
The Road to Autonomy Index® / Weekly Performance
The Road to Autonomy Index® is a high-definition lens into the emerging world of autonomous vehicles. It is the world’s first and only pure-play index designed to measure the performance of the autonomous vehicle/truck market.
For the week of April 1, 2024, The Road to Autonomy Index declined 0.95%, the S&P 500 declined 1.08% and the NASDAQ 100 declined 1.38%. The Road to Autonomy Index outperformed the S&P 500 by 0.13% and outperformed the NASDAQ 100 by 0.49%
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Latest The Road to Autonomy & Autonomy Economy Podcasts
The Road to Autonomy and Autonomy Economy podcasts are hosted by Grayson Brulte. The Road to Autonomy features unconventional conversations about the future of mobility.
Autonomy Economy features an insider’s perspective on the economics of autonomy.
New episodes every Tuesday and Wednesday.
Demystifying the Economics of Autonomous Trucking
Brett Suma, Founder & CEO, Loadsmith joined The Autonomy Economy podcast to discuss the unit economics of autonomous trucking and the Loadsmith self-balancing freight network.
Listen on The Road to Autonomy | Apple Podcasts | Spotify | YouTube Music
Wednesday, April 3, 2024
Scania’s Customer-Centric Approach to Autonomous Trucking
Peter Hafmar, Vice President & Head of Autonomous Solutions, Scania (part of the TRATON Group) joined The Road to Autonomy podcast to discuss Scania’s customer-centric approach to autonomous trucking and their partnership with Plus.
Listen on The Road to Autonomy | Apple Podcasts | Spotify | YouTube Music
Tuesday, April 2, 2024
The Economic Conditions Impacting the Adoption of Autonomous and Electric Trucks
Mazen Danaf, Senior Economist and Applied Scientist, Uber Freight joined The Autonomy Economy podcast to discuss the economic conditions impacting the adoption of autonomous and electric trucks.
Listen on The Road to Autonomy | Apple Podcasts | Spotify | YouTube Music
Wednesday, March 27, 2024
Subscribe to This Week in The Autonomy Economy™
A weekly newsletter featuring insight and commentary on the autonomy economy™ and how the financial markets are viewing its emergence.
All price references and market forecasts are as of the date that this newsletter has been sent. The Road to Autonomy is not providing any financial, economic, legal, accounting, or tax advice or recommendations in this newsletter. The information contained in this newsletter does not constitute investment advice and should not be relied upon to evaluate any potential transaction.
Inclusion of a security within The Road to Autonomy Index® is not a recommendation by The Road to Autonomy Indices LLC to buy, sell, or hold such security, nor is it considered to be investment advice.
