Innovation

Otto (self-driving truck company): The smart person's guide

In 2016, Uber purchased Otto, a self-driving truck startup, for $680M. TechRepublic's comprehensive guide explains Otto's technology, where it fits in the market, and what it means for businesses.

The race to develop driverless technology has never been hotter. Tesla has promised a "fully self-driving capable" vehicle in 2017, Ford says it will unveil fully-autonomous cars—no steering wheel, no driver required—by 2021, and dozens of other carmakers and tech companies are joining up to create driverless systems.

But driverless cars are only one side of the coin: Autonomous trucking is poised to majorly disrupt the trucking industry, and will likely have a big impact on jobs.

In August 2016, Uber purchased a self-driving trucking startup called Otto for more than $680 million, signaling a huge investment in the driverless space.

So why is Otto such an important asset to Uber? And how advanced is its driverless technology? This comprehensive guide explores how close Otto has come to developing a fully-driverless truck.

SEE: Check out all of TechRepublic's smart person's guides

Executive summary

  • What it is: Otto is a self-driving truck company that was acquired by Uber in August 2016 for $680 million.
  • Why it matters: Driverless trucks are poised to have a major impact on businesses and society, and many predict that the trucking industry may be the first big area to feel the consequences of the technology.
  • Who it affects: There are about 3.5 million US truck drivers, although the US trucking industry employs nearly 9 million people. Driverless trucks will likely have a big impact on these jobs.
  • When this is happening: Otto is still developing the technology for driverless trucks, but it achieved its first success in the fall of 2016 with a commercial beer run, shipping a load of 50,000 Budweisers 120 miles across Colorado. The driver simply pressed "engage" when on the highway, and the truck operated at level 4 autonomy during the trek from Fort Collins to Colorado Springs.
  • How to take advantage of Otto: Once the technology has matured, businesses could take advantage of driverless trucks—particularly for long-haul shipping.

What it is

Otto is a self-driving truck startup created by Lior Ron and Anthony Levandowski in January 2016. The technology is aimed to help long-haul truck drivers by taking over control of the vehicles on highways, and having the driver take back the wheel once it's time to exit. In August of that year, Uber purchased Otto for $680 million, marking a significant step in the company's driverless technology portfolio. Uber also teamed up with Volvo in 2016 to create an autonomous vehicle platform, citing the company's reputation for safety as a primary reason for the partnership. Otto now retrofits Volvo trucks with the technology for autonomous driving. As of March 2017, Volvo was testing vehicles on the roads of Gothenburg, Sweden through its "Drive Me" project.

Otto trucks are equipped with three LiDAR sensors in the cab and trailer, radar on the bumper, and a high-precision camera above the windshield. Inside the cab, there are various buttons that can disable the autonomous system, and a computer system that directs the navigation, monitored by an Uber engineer.

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Why it matters

Otto and other companies investing in driverless tech make the case that autonomous vehicles will help improve driving safety. There were 1.25 million deaths worldwide caused by vehicle crashes in 2014. And the following year, there was a 7.2% increase in traffic fatalities—the largest increase in more than 50 years. In terms of trucks, specifically, about 400,0000 trucks crash every year, according to federal statistics, killing 4,000 people. Self-driving technology could have a big impact on this trend by having drivers cede control of the vehicles.

Companies like Otto also matter to the employment landscape. Self-driving trucks are likely to be the first place for widespread adoption of driverless vehicle technology. Daimler's autonomous 18-wheelers, for instance, are already driving on public roads in Germany.

As the technology that enables radar, cameras, and GPS becomes more advanced, many automakers say they plan to have semi-autonomous vehicles available by 2020.

Still, there are many questions about liability, licensing, and other concerns when it comes to autonomous driving. States currently have different rules regarding autonomous driving on the road. And after a man driving an Autopilot-enabled Tesla died when both the driver and the system failed to brake in time—the first documented fatality in an autonomous vehicle—many voiced concerns that the technology is not yet mature enough to be used on the road.

Still, efforts are being made to address these issues at a regulatory level. In September 2016, the US Department of Transportation (DOT) released guidelines on the development of autonomous vehicle technology. And in January 2017, the DOT established a new committee on automation.

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Who it affects

As of March 2017, autonomous driving is still largely in testing mode, and there are limited opportunities for the public to interact with the technology—by taking a ride in Uber's driverless fleet in Pittsburgh, for example, or hailing one of Singapore's autonomous taxis. However, semi-autonomous features, like Tesla's Autopilot, which has automatic braking, auto-steer, lane-changing, and other safety features, is now available to consumers.

As the technology matures, there will likely be a big impact on people who drive trucks for a living. This could also impact the overall industry, with the potential to change trucking routes and schedules, delivery times, and more. While many worry that this translates into lost jobs, there is actually a reported shortage of drivers. According to the American Transportation Research Institute, there are 100,000 truck driving positions that need to be filled, which could only become more pronounced as the Baby Boomer generation retires.

Driverless vehicles will also affect regulators, lawmakers, insurance companies, and other industries. And, as driverless "platoons" are assembled, in which vehicles trail each other in a similar manner to fighter jets, there is the potential to save money and have a positive environmental impact through decreased fuel emissions.

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When is it happening?

Otto is currently testing on public roads in Nevada, Ohio, and California, and in 2016, completed a 120-mile beer run across Colorado. However, state regulations are pushing back on some of the testing, in both California and Nevada.

While Otto is currently one of the biggest players in autonomous trucking, it's not alone: In early 2017, three new driverless trucking startups—Embark, Starsky Robotics, and Drive.ai—offered up some news on their upcoming forays in the space.

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About Hope Reese

Hope Reese is a Staff Writer for TechRepublic. She covers the intersection of technology and society, examining the people and ideas that transform how we live today.

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