Riding high on a newly formed partnership with the United States Postal Service (USPS), self-driving truck startup TuSimple today announced that it’s secured an extension to its $95 million series D round led by Weibo creator Sina, which reached a total of $215 million and valued the company at $1 billion. CDH Investments, Lavender Hill Capital, Mando Corporation, and existing backer UPS committed $120 million in additional funding, bringing TuSimple’s total raised to $298 million to date.
Mando CFO Jae Chung said the infusion of capital will accelerate TuSimple’s systems development and enable it to expand its long haul service for fleets and co-develop a commercial self-driving truck with OEMs and Tier 1 suppliers. In May, the company revealed that the USPS had awarded it a contract to complete trips between the latter’s Arizona and Dallas distribution centers, and since May, its safety drivers and engineers have been working with UPS to conduct daily testing between Phoenix and Tucson.
“TuSimple continues to impress the automotive and investor community with its progress towards creating the world’s first commercial self-driving truck solution,” said Chung. “TuSimple’s technology is at a pivotal point for maturity and it has huge market potential, which is why we wanted to deepen our relationship with TuSimple and become a strategic investor.”
TuSimple’s Class 8 semi-trucks can carry loads exceeding 33,000 pounds and are level 4 under the guidelines penned by the Society of Automotive Engineers (SAE), meaning they’re capable of full autonomy in controlled (and often geofenced) highways and local streets. Unlike self-driving perception platforms from the likes of Uber and Waymo, TuSimple’s is decidedly camera-forward: Using an eight-camera array and other sensors, it can detect cars, pedestrians, and other obstacles up to 1,000 meters away. That’s compared to the roughly 250- to 300-meter range driverless systems dependent on lidar — laser-based sensors that bounce light off of objects to help map them digitally in three dimensions — are typically able to see.
TuSimple says its approach enables it to achieve three-centimeter precision for truck positioning even in inclement weather and at night, and that it allows for plenty of leeway in real-time decision-making. (It takes a truck 30 seconds to cover 1,000 meters.) It also claims better efficiency than its competitors; by keeping aware of traffic flow far ahead, TuSimple asserts that its trucks are able to maintain a given speed more consistently than human drivers and competing autonomous vehicle systems, cutting fuel consumption by as much as 15% and average purchased transportation costs by 30%.
“UPS is committed to developing and deploying technologies that enable us to operate our global logistics network more efficiently,” said UPS chief strategy and transformation officer Scott Price. “While fully autonomous, driverless vehicles still have development and regulatory work ahead, we are excited by the advances in braking and other technologies that companies like TuSimple are mastering. All of these technologies offer significant safety and other benefits that will be realized long before the full vision of autonomous vehicles is brought to fruition — and UPS will be there, as a leader implementing these new technologies in our fleet.”
TuSimple, which is headquartered in San Diego and has R&D labs in San Diego and test operations facilities in Tuscon, is currently performing multiple fully autonomous, revenue-generating trips a day for over a dozen customers (including Fortune 100 companies and “household names”) on four different routes in Arizona, and in June expanded the size of its U.S. fleet from 11 to 50 trucks. It has over 500 employees worldwide and hopes to close out 2019 with a 200-truck fleet in the U.S. and a 300-truck fleet in China, which would make it the largest self-driving truck solutions company in the world.
TuSimple has plenty in the way of competition, like Thor Trucks, Pronto.ai, and Aurora — the last of which attracted a $530 million investment in February at a valuation over $2 billion. There’s also Ike, a self-driving truck startup founded by former Apple, Google, and Uber Advanced Technologies Group engineers that’s raised $52 million, and venture-backed Swedish driverless car company Einride. Meanwhile, Paz Eshel and former Uber and Otto engineer Don Burnette recently secured $40 million for their startup, Kodiak Robotics. That’s not to mention Embark, which integrates its self-driving systems into Peterbilt semis and which launched a pilot with Amazon to haul cargo, and driverless truck solutions from incumbents like Daimler and Volvo.
But TuSimple is slowly but steadily expanding its footprint. In the coming months, it’ll run a series of self-driving trucks for 22 hours each (including overnight) along the I-10, I-20, and I-30 corridors through Arizona, New Mexico, and Texas. TuSimple notes that the freight flowing along I-10 corridor accounts for 60% of the U.S.’s total economic activity, and says that it expects it’ll become a central route for its autonomous vehicles in the years ahead.
There’s a strong demand for driverless trucks. It’s an industry predicted to reach 6,700 units globally, totaling $54.23 billion this year, and one that stands to save the logistics and shipping industry $70 billion annually while boosting productivity by 30%. Besides cost savings, the growth is driven in part by a shortage of human drivers. In 2018, the American Trucking Associates estimated that 50,000 more truckers were needed to close the gap in the U.S., even despite the sidelining of proposed U.S. Transportation Department screenings for sleep apnea.