“To err is human”: so, let’s remove the human?
Written by Julian Wheeler – Partner and US Equity Specialist
It is exactly 50 years ago that American musician, songwriter, and actor Kris Kristofferson as ‘Rubber Duck’ hit the road and our cinema screens in the quirky comedy ‘Convoy’. The CB radio jargon of truckers entered regular parlance, and the title song even made it into the music charts thanks to the popularity of a film about long distance truck drivers and their disregard for the “Smokey Bear”.
Half a century later and the culture has completely changed. No longer the celebrated independent ‘knights of the highway’, a truck drivers’ life has become relatively lower paid drudgery, often waiting around unpaid to pick up loads blocked at a chokepoint, with ‘Big Brother’ style surveillance cameras in the cab that track their every location, second of engine running time and even eye movement. It’s no wonder therefore, that the USA has almost a 100% annual turnover rate in drivers and an estimated shortage of 80,000. Those that are left are on average of over 50 years; their younger counterparts eschewing the Interstate and instead opting for easy-peasy local Amazon parcel drops and being home in time for dinner.
A solution to the problem first appeared over the brow of a hill back in the distance of late 2021, in the shape of driverless Class 8 trucks from one of my stock picks of the year: Aurora Innovation (AUR). Starting with some early pilot contracts to carry freight for Fedex, they required a safety driver at the wheel (where Tesla is starting now five years later). But in May 2025 the first fully driverless trucking service was launched, and the contracts have started to roll in from refrigerated truck operators and others carrying time sensitive perishable food. So now, barrelling down the road towards us, Aurora is the clear leader in those gigantic, Class 8 semi-trucks, having logged over 400k driverless highway miles, all without a single collision attributable to the ‘Aurora Driver.’
Among the early adopters of this technology are those who look like they might have the most to gain: the Shale Oil industry in Texas. With repeatable and predictable loads in remote areas, both Aurora and its primary competitor Kodiak began delivering frac sand in the Permian Basin this year. According to Aurora’s first logistics customer, Detmar, by being able to run these trucks for 20 hours a day, it has doubled their capacity to deliver sand compared to traditional human driven operations. In addition, it also lowers the hauling overhead and mitigated crash risks that were prevalent in the past. According to research by Houston based ‘Thunder Said Energy’ based on these first users’ experiences, autonomous trucks can halve the costs of moving not only sand, but water, tubular steel and other materials in shale basins.
While the world frets about the impact of AI and machine learning taking away human jobs in many industries, here is one where it should be welcomed. This is not the same situation as the much trumpeted ‘robotaxis’ that just aim to replace an army of existing cabbies based on cost alone.
Aurora’s driverless long distance trucking technology is an example of where a machine is doing work that humans not only do not want to undertake, but also where the obvious safety concerns mean they are quite unable do it on a 24-hour basis of which the unmanned version is capable.
In California, a state more unionised and opposed to any changes seen as detrimental to labour than any other, the driver shortages are so acute thanks to state labour laws, along with having the highest diesel prices in the country, that trucking rates are now 40% higher than the national average and even exceed the Covid induced peak prices. These economic realities have finally hit home and in a massive regulatory breakthrough, ending a decade long ban on self-driving large trucks, on August 14th California issued permits to both Aurora and Kodiak to allow testing on public highways.
Of course, no discussion about autonomous vehicles is complete without a mention of Tesla somewhere. While Tesla does indeed also make a Semi truck, Musk still does not state it as a priority. It is currently and likely will remain miles behind Aurora. There are two reasons. First, history tells us that the launch of any Tesla product is up to 5 years later than the time Musk says it will arrive. A bit like Waiting for Godot: it never happens. But the second, less flippant and more important reason is the fundamental difference in the two companies’ goals for what an unmanned vehicle should do.
Musk’s entire thesis is that his full self-driving (FSD) should drive and think like a human: using vision and reasoning. This is his excuse for skirting round the enormous cost of LiDAR, which he believes is a ‘crutch’ that can be overcome once your AI has achieved full capability. But is that even possible? Machines like humans always need to learn more, especially if you wish to drive everywhere and what about in all conditions? If it has no more than a camera, it will still get blinded by the sun in its eyes. Then, assuming it does become so ‘clever’, do we really want a truck that might ‘reason’ for itself that it might be a nice idea to take the scenic route for a change?
Aurora took the exact opposite tack and developed its own proprietary LiDAR at great cost. One that can analyse position and velocity of all objects half a mile ahead using every type of sensor; camera, radar and LiDAR. The cheaper option is to use off the shelf sensors (which is the greatest difference to Kodiak who do that) Aurora isn’t trying to be the ‘Jack of all Roads’ like Tesla but simply the ‘Master of the Highway’. It doesn’t want a truck to “think” or “see” like a human. No decisions to make, a limited scope of operation. Boring but safe and measurable; just what the Regulators like.
So which approach was given the green light in California? How about a permit for Tesla? Err, no!
How much safer and less congested will our roads be in future when most of the trucks and commercial vehicles are unmanned, usually travel through the night, when the would-be truck drivers are asleep in their beds rather than potentially at the wheel? Removing the human will also do away with the need for the second part of Alexander Pope’s proverb: “to forgive, divine”. Just like an elevator in a building, an autopilot in an aeroplane, there will be nothing to forgive with a ‘Rubber Duck’ that doesn’t ‘think’ for itself and as a result, avoid making a human error.
For more background on our U.S. market views, visit the Over the Pond archive.
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