Aurora’s Plan to Catch Waymo in Robot Trucks, Then Taxis

On Feb. 11, about a month after closing on the acquisition of Uber’s Advanced Technologies Group, or ATG, the self-driving-car startup Aurora held an all-hands meeting. Like every other company meeting since the pandemic began, it took place via videoconference and included the simulacra of in-person office interactions. When managers handed out awards, there was no applause from co-workers. Instead, Aurora co-founder and Chief Executive Officer Chris Urmson hit a button that produced canned cheers and clapping. “I am so looking forward to not having that button,” Urmson said after setting it off for the third time.

The weeks leading up to the meeting had been full of upheaval at Aurora Innovation Inc. Uber Technologies Inc. had essentially paid it to take ATG, forking over $400 million for a stake in the combined enterprise, which was valued at $10 billion. The deal allows Uber to unload a unit that was hemorrhaging cash while keeping a foothold in autonomous vehicles. Aurora, in return, adds almost 1,000 employees, more than doubling its workforce to 1,600 and bolstering its bid to become a credible competitor to Alphabet Inc.’s Waymo. The deal also gives Aurora what could be a bigger prize: the right to provide robo-taxis to Uber’s ride-hailing network.

“Having a strategic relationship with Uber is an incredible advantage,” Urmson says. Over the past two decades he’s done more than perhaps anyone to push the development of autonomous-driving technology. Now he’s in a leading position to be the first to truly commercialize it. But with the addition of hundreds of highly paid engineers and a large pool of potential customers, Urmson is under more pressure than ever to bring a product to market.

Since co-founding the company in January 2017—with former Tesla engineer Sterling Anderson and Drew Bagnell, who came from ATG—Urmson has been lining up deals to ensure that buyers will be waiting when his robot drivers are ready. The plan is to begin with long-haul trucking. Earlier this year, Paccar Inc.and Volvo Group signed agreements to install Aurora’s automated driving system in their trucks. The two companies would then offer these trucks, capable of operating themselves for long stretches, to their shipping customers, who would pay Aurora for the hours of automated driving.

After establishing itself in trucking, Aurora would begin cherry-picking the easiest, most lucrative trips from Uber’s ride-hailing network. A customer looking to go 25 miles, mostly by highway in light traffic, might be greeted by a driverless car. Aurora already has a deal with Toyota Motor Corp. to build robo-taxi fleets.

A 2019 investment from Amazon.com Inc. sets the company up for a similar strategy in delivery, allowing it to service the easiest routes for e-commerce customers. If all goes right, its robot drivers would take over entire fleets of cars, trucks, and vans.

Urmson says Aurora’s driving system can become better than the average trucker in a matter of years, not decades. He has a target in mind for when the first trucking product will be ready, though he’s not yet willing to share it. He knows as well as anybody how the work of building autonomous vehicles can expand endlessly. At 44, Urmson has been working on self-driving cars for most of his adult life, first as a 27-year-old graduate student at Carnegie Mellon University, where he led teams that competed in three Defense Advanced Research Projects Agency (Darpa) challenges, winning the final race in 2007. He then spent eight years with Google’s self-driving-car project, now known as Waymo.

Urmson left in 2016, shortly after Google passed him over for the CEO job and instead hired former Hyundai Motor Co. executive John Krafcik. “I’d been leading and building that team and, for all intents and purposes, general managing it for years,” he says. “Of course I wanted to run the program.” (Krafcik announced in April that he was leaving Waymo.)

Aurora was born from meetings Urmson had with Reid Hoffman, the LinkedIn co-founder and venture investor, and Mike Volpi of Index Ventures. The three thought that the automotive industry wouldn’t tolerate a Google monopoly in self-driving technology and that Urmson was the one to develop a viable alternative. “Chris had already gone through and solved the problem once,” Hoffman says, “and now knew which things he would rebuild entirely differently.”

In 2018, Hoffman’s firm Greylock Partners and Volpi’s Index co-led a $90 million fundraising round in Aurora, which has now raised more than $1 billion. It’s likely to take even more before Aurora will be able to support itself. “I don’t understand how Aurora is going to be able to survive without raising more capital,” says Grayson Brulte, co-founder of Brulte & Co., a consulting firm focused on transportation. The acquisition of ATG and its hundreds of engineers adds to that burden. “It’s like taking two money pits and making a bigger one,” says one former Aurora manager who asked to remain anonymous when talking about his past employer.

Urmson doesn’t shy away from the possibility the company may need to raise more money, and he’s confident it would be able to do so. He says the ATG merger is already showing tangible benefits. Before the deal, Aurora spent hours calibrating the sensors on each of its vehicles, with workers walking around holding placards at set distances to be sure the sensors measured accurately. ATG devised a faster, automated process using large turntables to rotate the vehicles. On the February call, a former ATG engineer said the turntables would soon be in place at all of Aurora’s vehicle depots.Electric vehicles, self-driving cars, and whatever else Elon Musk is up to this weekGet Bloomberg.com’s Hyperdrive newsletter.

Aurora will need every possible advantage in the race to bring autonomous vehicles to market. The leading competitor is Urmson’s old shop, Waymo, which, in addition to launching the first fully driverless ride-hailing service in suburban Phoenix last year, has a passenger-sharing agreement with Uber’s top rival, Lyft Inc. A handful of startups that have joined forces with auto manufacturers, including Cruise with General Motors Co. and Argo AI with Ford Motor Co., also promise to be formidable.

Urmson sees Aurora’s singular focus as its advantage. He doesn’t have to worry about quarterly earnings in other parts of the company or trying to keep the Detroit office at arm’s length. “This is the thing we do,” he says. “This is what we’re going to be excellent at.”

During the February meeting an employee asked if TuSimple, a San Diego-based autonomous-trucking startup that raised more than $1 billion in an initial public officer this week, might beat Aurora to that market. “We do think that we are going to be first or at least meaningfully first,” Urmson replied. He defines “meaningfully first” as a commercial product that can be scaled safely.

Urmson also believes Aurora’s lidar—the laser sensors that most autonomous vehicles use to perceive the world around them—is superior, giving it an edge. In 2019 the company bought the Montana startup Blackmore Sensors & Analytics, which makes a type of lidar called frequency-modulated, continuous-wave, or FMCW, that allows the sensors to simultaneously measure range and velocity, which vastly simplifies the problem of predicting the movements of faraway objects. “When you’re driving a truck at 65 miles an hour on the freeway and you want to react to the rare events, you need to see 300 meters down the road,” says Urmson. He says no one else in the industry can match that performance.

TuSimple and Waymo—which started its trucking division, Via, in 2017—also promote the superiority of their sensors. A wild card is Tesla Inc., whose CEO, Elon Musk, sees the lidar arms race as a never-ending fool’s errand. For the past six years the automaker has been using its millions of electric-vehicle customers as test subjects in a large-scale public road experiment in camera-based autonomous systems, offering an “autopilot” that allows drivers to relinquish control to the car. Musk has said Tesla owners will eventually be able to use their vehicles as robo-taxis during downtime. Urmson is skeptical. “It’s just not going to happen,” he says. “It’s technically very impressive what they’ve done, but we were doing better in 2010.”

In 2015, Urmson gave a TED Talk in Vancouver called “How a Driverless Car Sees the Road,” explaining how Google’s software was learning to recognize cars, buses, cyclists, and pedestrians and anticipate their movements. At the end he displayed a photo of his two sons. “My oldest son is 11,” he said, “and that means in four and a half years he’s going to be able to get his driver’s license. My team and I are committed to making sure that doesn’t happen.” His son, now 17, still doesn’t have his license, but he does have a learner’s permit. Over the past few months, while trying to teach trucks to drive themselves, Urmson has also spent a few hours teaching him to drive. “He’s working towards it,” he says. “I’m not actively sabotaging him.”

As featured in Bloomberg Businessweek on April 15, 2021

Self-driving startup Cruise raises $2.75 bln from Walmart, others

Self-drive automaker Cruise, backed by General Motors Co (GM.N), on Thursday said it raised $2.75 billion in its latest funding round with additional investment from Walmart Inc (WMT.N) and others, taking the startup’s valuation over $30 billion.

The announcement comes a week after peer TuSimple revealed plans for an initial public offering (IPO), at a time when self-drive technology is yet to be commercialised.

“We are focused on our path to commercialization right now but the IPOs happening in the space right now are a great indication of the strength of the industry and the opportunity self-driving presents,” a Cruise spokeswoman said in a statement to Reuters.

In January, the San Francisco-based startup said Microsoft Corp (MSFT.O) would join General Motors, Japan’s Honda Motor Co Ltd (7267.T) and institutional investors for a combined new equity investment of over $2 billion.

On Monday, Cruise said it planned to begin deploying a limited number of its Origin vehicles for ride-hail services in Dubai from 2023, its first overseas commercial service.

“Cruise is executing a global strategy with the right partners,” said Grayson Brulte, president at consultancy Brulte & Co. “At the end of the day it will come down to who can cut the best deals which generate long-term revenue and profits.”

Cruise’s relationship with Walmart includes a trial delivery service in Scottsdale, Arizona, announced in November.

As featured in Reuters on April 15, 2021

Waymo Chief John Krafcik Resigns, Co-CEOs Tapped To Run Alphabet’s Self-Driving Tech Giant

John Krafcik, the auto industry veteran who’s run Waymo for over five years, is stepping down as CEO of the Alphabet Inc. self-driving tech giant and is being replaced by two high-ranking company executives. 

Kracik announced the surprise news via a Twitter post on Friday. Takedra Mawakana, Waymo’s chief operating officer, and Dmitri Dolgov, its long-time CTO, are both being promoted to co-CEOs, the company said. Krafcik will continue to work with Waymo as an advisor.

“After 5 exhilarating years leading this team, I’ve decided to depart from my CEO role at Waymo & kick-off new adventures,” he said on Twitter. “To start, I’m looking forward to a refresh period, reconnecting with old friends & family, and discovering new parts of the world.”

A Stanford University-trained engineer who spent most of his career with automakers Hyundai Motor and Ford, Krafcik was tapped to take over Google’s self-driving car project in 2015. He transitioned from an R&D program to the largest autonomous technology company in the U.S., creating the Waymo brand name and launching the first public robotaxi project in suburban Phoenix. More recently the company has worked to build up its autonomous logistics business, dubbed Waymo Via, amid rising competition to develop self-driving trucks and vans from competitors including TuSimple and Aurora. 

While Waymo has been the benchmark for self-driving vehicles for more than a decade, its efforts to commercialize the technology have developed more slowly than many expected. The company has said it generates revenue from partnerships with several companies it works with, though has never disclosed financial details. It has has raised billions of dollars from outside investors, in addition to billions of dollars of support from Alphabet over the years. 

“The challenge going forward for Waymo is to find a path to meaningful revenue and meaningful profitability,” says Grayson Brulte, president of consultancy Brulte & Co., who closely tracks developments in the autonomous vehicle industry. “In particular, Waymo has yet to demonstrate a meaningful path to profitability for the robotaxi business.”

Krafcik joined Google almost six years ago, after long stints as Hyundai’s U.S. CEO and as a chief engineer with Ford. His automotive career started in 1984, when he was among the first engineers hired at New United Motor Manufacturing Inc., the joint-venture auto plant created by Toyota and General Motors in Fremont, California. The plant shut down in 2009 but Toyota sold it to Tesla in 2010, and it’s been the electric vehicle maker’s main auto-assembly plant ever since.

Computer scientist Dolgov is an original member of the self-driving tech all-stars Google recruited more than a decade ago in a moonshot effort to create the first self-driving vehicles.

Mawakana, who holds a law degree from Columbia University, initially joined Waymo as its head of policy in March 2017, before being promoted to COO in 2019. She previously worked for Yahoo and eBay and is member of Intuit’s board of directors.

Notably, she is also just the second woman of color to lead an autonomous vehicle tech company, joining Zoox CEO Aicha Evans.

As featured in Forbes on April 2, 2021

Aurora, Volvo are Latest Partners on Self-Driving Heavy Trucks

(Reuters) – Global heavy truck manufacturers are lining up technology partners to help build out self-driving systems for long-haul freight that could see widespread commercial service well before self-driving robotaxis.

The latest alliance was announced Tuesday between Sweden’s Volvo Group and California-based Aurora Innovation, building on a working relationship that dates back several years, the partners said.

Analysts expect more such partnerships, as relatively young technology firms such as Aurora connect their autonomous vehicle systems knowledge with the deep manufacturing experience of legacy companies such as Volvo Trucks.

“You can’t go at it alone in autonomy,” said Grayson Brulte, president consultancy Brulte & Company. “The trucking industry is a completely different personality” than the passenger vehicle business, with different requirements.

Most of the larger truck manufacturers have turned to self-driving tech partners, driven in part by a chronic shortage of drivers and a boom in e-commerce, fueled by the global pandemic.

In January, Aurora announced a strategic partnership with U.S. truckmaker PACCAR, whose brands include Peterbilt and Kenworth.

Aurora’s founders include self-driving veterans from Tesla and Alphabet’s Waymo. Aurora last year said its first commercial product would be in trucking “where the market is largest (and) the unit economics are best.”

In 2020, Waymo Chief Executive John Krafcik told Reuters that “goods delivery is a bigger market than moving people” as Waymo expanded its focus to include heavy trucks.

Germany’s Daimler has formed a self-driving truck alliance with Waymo, while China’s largest heavy truck maker, FAW Jiefang, has partnered with Plus AI.

Volkswagen’s Traton truck group is an investor in TuSimple, as is U.S. truckmaker Navistar.

In a January earnings call, Tesla Chief Executive Elon Musk said the long-delayed Semi electric truck is highly likely to be the first of the company’s vehicles to achieve full self-driving capability.

As featured in Reuters on March 30, 2021

A Next-Generation Gateway to the Great Outdoors

Self-driving vehicles should deliver more than transportation. They should deliver experiences.

That’s the belief of Grayson Brulte, an innovation strategist and co- founder of Brulte & Co., a mobility advisory company based in Palm Beach, Fla. Rather than no-frills robotaxi service, he believes purveyors of autonomous technology should instead focus on providing premium experiences.

Imagine reserving a vehicle at a hotel and being carried through a Napa Valley winery tour — no designated driver needed. Or imagine taking a self-driving vehicle to a ballgame where the tailgating happens on board.

“Self-driving technology should enhance the experience — that’s the Holy Grail,” he said. “You make the transportation not boring. You make it one of the most interesting parts.”

Such journeys were on Brulte’s mind recently when the National Park Service unveiled a first-of-its-kind partnership with Beep, a mobility operator, in which autonomous shuttles will be deployed to carry visitors in Yellowstone National Park next spring. 

At least for now, the pilot project is strictly about transportation: Two autonomous shuttle buses will trundle around the Canyon Village base area, helping to alleviate congestion while connecting parking areas with popular amenities. Operationally, these likely will be some of the first experiences members of the public have with self-driving technology.

It’s not difficult to consider how the National Park Service could utilize such shuttles in the future. 

“You take your family out, and the vehicle itself is teaching you about Old Faithful or buffalo or the history of Teddy Roosevelt in the park,” Brulte suggests. “The vehicle becomes a mobile classroom. Think about the potential of that. You are bringing the classroom to nature. That changes the game.”

To be clear, that’s not part of the current pilot project. But it’s a compelling vision of how autonomous vehicles could be used within the national park system. One that Joe Moye, CEO of Beep, says would be a natural evolution of the shuttles’ human staffing and technical capabilities. 

He notes the vehicles know their location within millimeters, which would lend themselves to site-specific educational programming. Beep’s shuttles, on the road in Lake Nona, Fla., are outfitted with video screens for advertising purposes. As the company transitions from a human safety driver aboard shuttles to a virtual ambassador in the years ahead, such a voice could double as tour guide.

All this aligns with a vision for AVs sketched by Sarah Sandman, an artist with the TED Fellows who was asked by Lexus to help think about new autonomous-vehicle designs.

“One of the most magical moments of travel that I’ve ever experienced was on the Empire Builder train going cross country,” she said of the Amtrak route that connects Chicago and Seattle. “There is a glass car. You can swivel and look out to see what’s happening in the glorious world.”

Autonomous vehicles can enable and enhance these experiences, forging connections with the outside world rather than cocooning occupants inside. At their best, they may reinforce the old adage about travel — getting there is indeed half the fun.

As featured in Automotive News on December 21, 2020