Komatsu Sets Autonomous Mining Record
This Week in The Autonomy Economy is presented by Koop Insurance, a specialist insurance provider focused on robotics and autonomous vehicles.
This Week in The Autonomy Economy, The Road to Autonomy Index declined 4.97%, Komatsu became the first company in the mining industry to have 10 autonomous trucks surpass 100,000 autonomous hours each, Intel is exploring a sale of Mobileye and Waymo is eyeing profitability.
Autonomous vehicles are becoming a business, now the big question that remains is when do they become profitable? What is it going to take for robotaxis and autonomous trucks to become profitable?
In autonomous mining applications, it’s the labor costs, transportation and housing costs (Western Australia) and increased productivity. For robotaxis, will it be the decreasing hardware costs and increased availability? For autonomous trucks, will it be ability to operate 24/7?
These are all questions that remain today, but will be answered as autonomy scales. As autonomy scales, there is always going to be a dissenting group of individuals and special interests who for right or for wrong have chosen to make it their lives work to stop the advancement of automation and autonomy.
Case in point, the International Longshoremen’s Association is openly threatening to shutdown the U.S. East Coast and Gulf Coast ports that handle 43% of U.S. imports on October 1st, if an 80% pay raise over six years is not approved and automation and semi-automated terminals aren’t banned.
A strike will cause billions in economic damage, while potentially reaccelerating inflation, just as the Fed currently prepares for a rate cut(s).
The more the unions push for no-automation and higher wages, the more companies are going to move towards automation and autonomy. At the end of the day, unions could end up accelerating the adoption of autonomy.
Waymo parent Alphabet is a The Road to Autonomy Index component company
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What’s Moving the Markets
Komatsu Sets Autonomous Mining Record
During the summer Komatsu became the first company in the mining industry to have 10 autonomous trucks surpass 100,000 autonomous hours each.
Komatsu currently has a global fleet of over 750 autonomous haul trucks. Collectively these autonomous trucks have hauled more than 10 billion metric tons of material and are adding to that milestone at a rate of over 6 million metric tons per day.
Our take: Off-road autonomy is scaling and it is proving to be a very profitable business.
Underperformance Leads to a Potential Sale
Intel has declined 60.48% YTD while the S&P 500 has returned 14.03%. Intel is in trouble, the company has a negative free cash flow of $3.39 billion (June 30, 2024) and it needs to raise capital.
One way to raise capital is to sell assets. Bloomberg is reporting that Intel is considering selling up to 88% of its holding in Mobileye on the public market or via a private sale to a third party. The timing of a potential sale is not ideal as Mobileye’s stock is down 72.06% YTD.
Mobileye currently has a market cap of $9.37 billion. When Intel acquired the company in 2017, they paid $15.3 billion. On October 26, 2022, Intel spun Mobileye out and IPOed the company at a valuation of $17 billion, below Intel’s projections.
No matter what direction Intel ultimately pursues as it relates to Mobileye, they stand to lose billions on their acquisition of Mobileye. Mobileye, once the darling of autonomous driving (in certain circles) has fallen out of favor as the approach to developing autonomous driving systems has changed.
The biggest benefactors of the changing approach have been NVIDIA and Qualcomm.
Waymo Eyes Probability
As Waymo ramps up commercial operations, the company is turning a keen eye towards profitability as they look to cut costs. First it was the introduction of the low-cost Zeeker vehicle, then it was the optimization of the sensor suite and now we are hearing (unconfirmed) that Waymo is preparing a round of layoffs.
The layoffs (we are hearing) are aimed at reducing bloat in the organization and are not a reflection on the current state of the business.
Each and every week, Waymo is now completing over 100,000 paid rides in three major cities with a 4th (Austin, Texas) and perhaps a 5th (Atlanta, GA) coming online over the coming quarters.
With the focus on expanding paid operations and reducing costs, the question of how long will it take for Waymo to achieve profitability is still debatable.
From an investor perspective, when will Alphabet breakout Waymo earnings? On today’s episode of Autonomy Markets, Walter Piecyk drew a line in the sand and made a prediction.
Tune in at 2pm EST to learn what it is and what it will take for Alphabet breakout Waymo earnings.
Our take: Waymo is a business, it’s no longer a moonshot.
Waymo is currently ranked #1 with a bullish outlook on the AUTONOMY LEADERBOARD in the autonomous vehicle category.
Waymo parent Alphabet is a The Road to Autonomy Index component company
Autonomy: A Threat or Strength for Uber? Waymo’s Unforced Error and the Affordability of Delivery
Autonomy Markets, co-hosted by Grayson Brulte and Walter Piecyk debuts today at 2pm EST. In the inaugural episode Grayson and Walter discuss Wall Street’s perspective on autonomy, the implications that autonomy could have on Uber and whether it’s a strength or weakness for Uber. Along with the impact of Tesla entering the robotaxi sector and the growth of Waymo.
Subscribe to The Road to Autonomy on YouTube to be notified when the episode is released. Weekly episodes will also be available on Apple Podcasts and Spotify.
Tesla, Uber and Waymo parent Alphabet are The Road to Autonomy Index component companies
Piquing Our Interest
Waymo Releases Safety Data Waymo has published a Safety Impact report that will update regularly comparing the Waymo driver to human drivers. Bottom line, it’s safer to ride in a Waymo vehicle than in a human driven vehicle.
Aurora is Heading West On September 5th, Aurora announced a planned route expansion between El Paso, Texas, and Phoenix, Arizona for the first half of 2025. Aurora’s intent is to go fully autonomous (no safety driver) on that route in the second half of 2025.
Toyota Industries Corporation Invests in Gideon Through this investment Gideon will have access to Toyota’s world leading manufacturing expertise, broad market access and global service network.
An Intentional Act of Aggression Caught on Camera The old saying that criminals are dumb seems to continue decade after decade. This time in San Francisco a cyclist put his hand on a Waymo, dismounted from his bike and “pretended” to be hit by the vehicle. Little did the cyclist know that Waymo captures video. That video along with the data was provided to the CA DMV, clearing Waymo of any wrongdoing. Sometimes they never learn.
Uber’s Year of Partnerships Continues On September 5th, Uber announced a partnership with Turo that will enable Uber customers to rent cars from Turo inside of the Uber app. Uber is becoming the Everything Mobility App.
Shining a Light on Remote Operations The New York Times recently published an in-depth piece on Zoox’s remote operations. Years ago, we visited Zoox and demoed their remote operations. It was impressive then and we assume it has only gotten better since.
Social Buzz
Politics and Personal Gain Before The Economy
Once again, union leaders are putting politics and their own personal financial gain ahead of hard working Americans and the U.S. economy, as they are threatening to shut down U.S. ports on October 1st.
The ILA receives over $27 million a year in dues, agency fees and taxes from its members, and it compensates its officers generously, according to Labor Department filings. Daggett’s annual compensation is $855,000, more than three times as much as Teamsters President Sean O’Brien. Daggett’s son, executive vice president Dennis Daggett, earns $468,000, and another top four union officers make over $500,000 annually. ILA bosses need members’ pay hikes to fund these generous salaries.
– Diana Furchtgott-Roth, former deputy assistant secretary for research and technology at the U.S. Department of Transportation, is an adjunct professor of economics at George Washington University (as published in an August 25th The Hill op-ed)
Over 45,000 workers will go out on strike, shutting down three dozen ports in the event of a strike. The strike would affect 43% of all U.S. imports, causing billions in economic damage, while reaccelerating inflation as the Fed currently prepares for a rate cut(s). Why, what do they want?
International Longshoremen’s Association President Harold Daggett wants automation and semi-automated terminals eliminated and an 80% pay increase over six years.
Every worker would like an 80% pay raise over six years. Plain and simple, but it’s not economically feasible. As for why Mr. Daggett wants automation banned, it’s rather simple—member dues.
Automation decelerates member dues and accelerates economic growth while limiting the Longshoremen’s grip on ports. Can’t have that. So what are the Longshoremen doing?
In a selfish maneuver, the Longshoremen are threatening to accelerate an economic downturn by going on strike unless automation and semi-automated terminals are banned.
If ports are shut down, economic growth stalls, the U.S. will have a major economic catastrophe right before a Presidential election in November. Talk about playing politics.
Tesla Releases FSD Roadmap
On September 5th, Tesla AI released the FSD timeline, sending the stock up 4.9%. Despite the negative and often misleading headlines about FSD (Supervised), the product continues to improve and impress. While FSD (Supervised) does not yet enable full autonomy, it’s only a matter of time until Tesla achieves full autonomy.
When Tesla achieves full autonomy, there will be a seismic change in the autonomous vehicle market as LiDAR will become obsolete outside of autonomous trucking and select off-road applications.
Our take: We are waiting to see what Tesla ultimately unveils on October 10th at Warner Bros. Could David Zaslav make a guest appearance?
Tesla is currently ranked #1 with a bullish outlook on the AUTONOMY LEADERBOARD in the personally owned autonomous vehicle category.
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 September 2nd, The Road to Autonomy Index declined 4.97%, the S&P 500 declined 4.25% and the NASDAQ 100 declined 5.89%. The Road to Autonomy Index underperformed the S&P 500 by 0.72% and outperformed the NASDAQ 100 by 0.92%.
Year to Date (YTD), The Road to Autonomy Index has returned 7.75%
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The Road to Autonomy Index Component Companies
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Latest The Road to Autonomy Podcast
Micron’s Vision for Safer Roads: How Memory Drives the Future of Autonomous Vehicle
Bruce Franklin, Senior Directive of Automotive, Micron joined Grayson Brulte on The Road to Autonomy podcast to discuss the crucial role of memory in autonomous vehicles and the broader automotive industry.
Listen on The Road to Autonomy | Apple Podcasts | Spotify
Tuesday, September 3, 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.
