Since 2015, there have been at least 57 major retail bankruptcies. And after more than 5,000 store closures in 2017, we are on track to surpass that number in 2018. A combination of increased online shopping, declining foot traffic in malls, and competition from digital-native brands has made retail a more challenging industry. Today’s retailers will have to adapt quickly to succeed in a rapidly changing market dominated by e-commerce.
Brick and mortar stores are being pummeled by e-commerce retailers with drastically lower overheads. Companies like Warby Parker and Casper have successfully connected the dots between the online and physical retail experience. But for the next pioneers of commerce, there is something even more disruptive happening around the corner: autonomous delivery.
Auto manufacturers, such as Toyota, have already partnered with several companies, including Amazon, to create self-driving package and food delivery vehicles. With autonomous vehicles in their infancy, it can be difficult for any industry to imagine and, more importantly, implement innovative use cases. But the retailer of the future has to explore the opportunities autonomous vehicles offer — from deliveries to roving showrooms to other capabilities not yet imagined.
Making “lean” more lean
For retailers launching a new product or looking to break into a new market, autonomous vehicles with delivery capabilities can reduce the cost of being in a physical retail store, a mall kiosk or a pop-up shop. Additionally, autonomous vehicles can provide accurate insights into where a product is gaining traction and where it is being sold. The vehicle can then efficiently move between low and high trafficked areas. From the perspective of the lean startup methodology, autonomous vehicles applied to retail could reduce production costs and overhead and could minimize the risk of product failure before mass distribution.
Showrooming
Most folks shop with their smartphone in hand, comparing prices between physical and online stores. Nearly 71 percent of consumers are shopping online to find a better price. This shows that while consumers do want to look, feel, and touch the items they buy, they are very much price conscious.
A mobile self-driving showroom — a low-cost retail store on wheels — could be a major win for consumers by solving the online shopping problem of buying products without seeing or touching them first. And for retailers, there is the major benefit of mitigating the risks associated with setting up a physical storefront. This keeps the costs low for both the retailer and the consumer and can serve as a great brand awareness opportunity when exploring new test markets.
Connecting the online and offline worlds
Retail e-commerce sales represent only 10 percent of total retail sales in the US. Companies such as Casper and Warby Parker succeeded by combining the e-commerce business model with the ability to touch and feel a physical product through a delivery system. They successfully connected the online to offline worlds and bridged that gap. While they eventually opened up popup locations and, in some cases, physical retail locations, it is this connection between the physical and digital worlds that created a recipe for success.
In the near future, autonomous vehicles powered by AI will be able to bridge that same gap for other retailers while gathering insights on where the most successful target markets are likely to be.
It’s safe to say that businesses will adopt autonomous vehicles faster than consumers with the exception of some exceptionally keen early-adopter types. With the potential cost savings that can materialize throughout the supply chain by integrating machine learning and AI and by reducing the overhead of physical stores, commerce will find itself evolving from traditional brick and mortar stores to mobile stores that are on-demand and that relocate in response to customer and business demands. It’s only a matter a time.
Tactile Mobility raises $9 million to derive insights from vehicle sensor data
Tactile Mobility, which was founded in 2012 by Boaz Mizrachi, Yossi Shiri, and Alex Ackerman, provides tactile sensing and data analytics solutions for smart and autonomous vehicles, municipalities, and fleet managers. An in-vehicle software module running on an ECU or aftermarket device collects data generated by a car’s non-visual sensors, and it applies AI models to generate insights including (but not limited to) road quality, tire grip, RPM, paddle and gear position, wheel angle and speed, vehicle weight, and other vehicle- and road-specific metrics.
The insights are fed into onboard computers to optimize driving decisions before they’re uploaded to Tactile Mobility’s cloud, which produces a real-time and anonymized map of road features like grades, banking, curvature, normalized grip levels, and the location of bumps and potholes. (To date, Tactile Mobility says it’s crunched over 10.5 million miles of real-life drivers’ data.) Bespoke models handle tasks such as data ingestion, fusion, noise cleaning, and processing, in theory ensuring high accuracy without the need for human oversight.
Union Tech Ventures investment manager Rinat Yogev pitches Tactile Mobility’s suite as a means of furnishing OEMs and city officials with high-value driving data, so that they’re able to better conduct planned maintenance and optimize systems like adaptive cruise control and active suspension management. To be sure, the vehicle telematics market is a lucrative one, with some analysts estimating it’ll hit $104.10 billion by the end of 2025, up from $39.64 billion in 2018. That’s not surprising given that 116 million connected cars are anticipated to hit the road in the U.S. by 2025, each of which will upload as much as 25GB of data to the cloud per hour.
“Tactile Mobility’s technology, which is at the intersection of data analytics and vehicle connectivity, uses machine learning to provide real-time insights not only on individual vehicles, but on road conditions and driving safety,” said Yogev. “We are proud to support Tactile Mobility in their vision towards smarter vehicles and safer roads.”
In a statement, Porsche executive board member for R&D Michael Steiner added, “Tactile Mobility’s method helps us collect additional information about the condition of vehicles and roads — beyond conventional sensor systems. An integration into series production cars is planned for the start of the next decade. Among other elements, tactile data can further improve the assessment of the friction coefficient between tyres and the road surface while a vehicle is moving. The system’s potentials also lie in predictive servicing and optimising battery management.”
Tactile Mobility isn’t the only startup performing sensor fusion to measure road roughness, it’s worth noting. Swedish company NIRA Dynamics applies machine learning algorithms to vehicle sensors, controllers, and camera feeds to measure metrics like grip and friction in real time, and apps like RoadBounce detect problematic sections of road from smartphone accelerometer and gyroscope data alone.
Waymo begins offering robot-taxi trips sans safety driver in Phoenix
(Reuters) — Waymo Chief Executive John Krafcik said the self-driving vehicle company is now offering limited “rider-only” trips in Phoenix, Arizona, as it looks beyond the robo-taxis business to generate future revenue.
Waymo, a unit of Alphabet, has begun offering fully automated rides, without attendants in the vehicle, to a few hundred early users of its robo-taxi service in Phoenix, Krafcik confirmed on Sunday at a dinner with journalists ahead of a conference in Detroit.
He did not say when or how quickly Waymo would expand “rider-only” services. Riders signed up for the fully automated service have signed non-disclosure agreements, he said.
Waymo continues to look for new ways to sell its technology, beyond robo-taxi services, Krafcik said.
The company is testing its so-called automated driver on Peterbilt trucks and plans to expand trucking and commercial delivery applications of its technology as part of a project known internally as “Husky,” Krafcik said. Waymo has said it is testing its system on trucks in Michigan, Arizona, and Georgia.
“We think trucking is a really interesting application of the Waymo driver,” Krafcik said. He added that current regulations do not allow driverless operation of heavier trucks, however.
Waymo would consider selling its driver technology to a carmaker that wants to offer automated driving as a feature either branded as Waymo or using the vehicle maker’s brand. “Both would be interesting,” Krafcik said.
One idea Waymo could consider is supplying its automated driver to a new vehicle, then having the vehicle move later in its life to a ride sharing fleet, he said.
Waymo has announced agreements to develop self-driving vehicles and services with Renault SA and its Japanese partner Nissan Motor Co, and has deals to use minivans made by Fiat Chrysler Automobiles NV and Jaguar iPace sport utility vehicles in its robo-taxi fleets.
Waymo’s careful rollout of self-driving vehicle services comes as many automakers and rival self-driving vehicle companies are scaling back or consolidating their efforts. The high costs and technical challenges of developing a safe, reliable automated driving system coupled with uncertainty about regulation have put a chill on the automated driving industry’s previous exuberance.
Backed by Google’s capital and computing power, Waymo has continued to grow. The company operates a facility in Detroit to retrofit Chrysler minivans and Jaguar iPace SUVs.
One problem the automated vehicle industry faces is confusion about the terms used to describe the technology, Krafcik said. Tesla markets a system called “Autopilot” that is supposed to require a driver to remain ready to take control of the car. Federal safety regulators are investigating recent fatal crashes involving vehicles on Autopilot.
Other carmakers offer systems that partially automate a vehicle during highway driving or in stop-and-go traffic, and describe them in a variety of terms.
“If you need a driver’s license, it’s not self driving,” Krafcik said.
Pony.ai to launch BotRide robo-taxi service in Irvine
Guangzhou, China-based startup Pony.ai today announced it’ll launch an autonomous ride-sharing program in Irvine, California on November 4, running through January. The service — dubbed BotRide — follows on the heels of an April test of the company’s “product-ready” driverless cars in Nansha, China, and it marks one of the first robo-taxi services to be made available in California.
Like PonyPilot, BotRide will allow individual riders and carpoolers to hail autonomous cars for free through Android and iOS apps developed in collaboration with Via. (Via handles booking and passenger assignment.) The vehicles in question are Hyundai KONA Electric SUVs outfitted with sensor hardware and Pony.ai’s proprietary autonomous navigation software, which the startup says can identify and predict the behavior of nearby vehicles and pedestrians while navigating challenging traffic conditions in urban areas.
BotRide will automatically verify onboard passengers and direct them to nearby stops for pickup and drop-off. Pony.ai said that a fleet of 10 cars with human safety drivers behind the wheel will be available Monday through Saturday, and that the service area will span public roads in residential, commercial, and institutional points of interest.
“The pilot introduces BotRide to several hundred Irvine residents, including college students. The goal is to study consumer behavior in an autonomous ride-sharing environment,” said Hyundai Motor Company head of business development Christopher Chang. “We are going to learn about ecosystems, where the vehicles travel and optimize the customer experience. BotRide is another example of Hyundai’s ongoing efforts to actively build expertise in mobility technology as well as the company’s commitment to providing more user-friendly mobility services to customers.”
The announcement comes after Pony.ai unveiled a partnership with Toyota, the Japanese auto giant with a roughly 9% share of the global car market, to explore “safe” mobility services involving driverless technology across a range of segments and industries. The two companies plan to kick off on a pilot program on public Beijing and Shanghai roads to “accelerate the development and deployment” of autonomous vehicles, using Lexus RX vehicles and Pony.ai’s driving system.
Former Baidu chief architect James Peng cofounded Pony.ai in 2016 with Tiancheng Lou, who worked at Google X’s autonomous car project before it was spun off into Waymo. The pair aims to build level 4 autonomous cars — able to operate without human oversight under select conditions, as defined by the Society of Automotive Engineers — for “predictable” environments, such as industrial parks, college campuses, and small towns, with a tentative deployment window of 2 to 3 years from now.
Pony’s full-stack hardware platform, PonyAlpha, leverages lidars, radars, and cameras to keep tabs on obstacles within up to 200 meters of its self-driving cars. It serves as the foundation for the company’s fully autonomous trucks and freight delivery solution, which commenced testing on public roads in April, and it is deployed in test cars within the city limits of Fremont, California and Beijing (in addition to Guangzhou).
Pony.ai is one of the few companies to have secured an autonomous vehicle testing license in Beijing. Stateside, in California, it has obtained a robo-taxi operations permit from the California Public Utilities Commission. Only three other companies have such a license in California, among them AutoX, Waymo, and Zoox.
Earlier this year, Pony.ai — which has tripled its headcount since January 2018 — attracted $50 million in pre-B financing from video game publisher Beijing Kunlun Wanwei, making it one of the most valuable autonomous driving startups in China. It previously raised $102 million from lead investors ClearVue Partners and Eight Roads (Fidelity International Limited’s investment arm), bringing its total raised to roughly $300 million and taking its valuation to over $1 billion.
Pony.ai has competition in Daimler, which last summer obtained a permit from the Chinese government that allows it to test self-driving cars powered by Baidu’s Apollo platform on public roads in Beijing. Separately, startup Optimus Ride built out a small driverless shuttle fleet in Brooklyn. Waymo, which has racked up more than 10 million real-world miles in over 25 cities across the U.S. and roughly 7 billion simulated miles, in November 2018 became the first company to obtain a driverless car testing permit from the California Department of Motor Vehicles (DMV). Other rivals include GM’s Cruise Automation, Tesla, Zoox, Aptiv, May Mobility, Pronto.ai, Aurora, Nuro, and Yandex, the last of which has accumulated over 1 million autonomous miles to date.
Fortunately for Pony.ai, there’s plenty of cash to go around in China’s goldmine of a driverless car market. According to a McKinsey report, self-driving vehicles and mobility services in the region are expected to be worth more than $500 billion by 2030, when the number of autonomous cars on public roads is expected to reach 8 million.
Volvo will report autonomous truck financials from 2020
Volvo is setting up a new business area for autonomous transport as it ramps up its ambitions in the driverless vehicle realm.
With Volvo Autonomous Solutions, the Swedish automotive giant is committing to breaking out its financials specifically relating to self-driving trucks, a process that will start after the change is actioned on January 1, 2020. The company suggested that this level of profit-and-loss disclosure will help it accelerate its goals in the burgeoning driverless vehicle industry by offering greater transparency to shareholders.
“It is a logical next step for us to gather expertise and resources in a new business area with profit-and-loss responsibility to take autonomous transport solutions to the next level,” said Volvo president and CEO Martin Lundstedt.
However, this news should be juxtaposed against Volvo’s third-quarter financials, where it has just reported a 45% year-on-year (YoY) drop in truck orders compared to the same period last year. It’s clear Volvo wants to appease shareholders by demonstrating that it’s looking to — and preparing for — a big transition to an autonomous future. Volvo said it’s currently in the process of recruiting a new head to lead its Volvo Autonomous Solutions unit.
Automation in industry
While Volvo has been making moves in the self-driving car sphere, including partnering with Uber for its own driverless car trials, most of Volvo’s higher-profile efforts of late have been in bringing autonomous trucks to market. A few months back, the company announced a partnership with ferry and logistics giant DFDS, which plans to use Volvo Trucks’ Vera to transport goods between a logistics hub and a port in Sweden.
Last year, Volvo announced that its first commercial self-driving trucks would be used in mining to transport limestone from mines to a nearby port, and the company has also trialed its technology to help sugarcane farmers in Brazil improve their crop yield and to collect garbage in Sweden. Back in June, Volvo partnered with chip giant Nvidia to collaborate on autonomous trucks.
A number of companies are working on autonomous trucking technologies, including Mercedes-Bens parent Daimler and fledgling startups such as Sweden’s Einride, which recently raised $25 million.
It’s still very much early days for autonomous vehicles, but there is a growing sense that the technology will gain steam through niche use cases in specific industries, using “predefined routes, in repetitive flows” as Volvo puts it. This is why Volvo has now committed to divulging its figures through Volvo Autonomous Solutions, which will be reported as part of its Volvo Trucks business.
“We have experienced a significant increase in inquiries [about autonomous transport] from customers,” Lundstedt said. “With the Volvo Group’s wide range of offerings and broad experience of different applications, we have a unique opportunity to offer solutions that meet their specific needs.”
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