TuSimple Holdings Inc., the self-driving semi-truck startup that raised $ 1.35 billion in a public offering on Thursday, sees a quick path to profit once it rolls out its 18-wheeler driverless vehicles in 2024 Road brings.
The San Diego-based company with significant operations in China has lost more than $ 300 million in the past three years. The promise to generate monthly sales of $ 1 million in the second half of 2019 was not kept. Instead, it posted $ 1.8 million in revenue last year with a loss of $ 178 million.
TuSimple now expects to see profits for partners like Navistar International Corp. shortly after starting self-driving trucks in three years and the Traton SE truck unit of Volkswagen AG, said Cheng Lu, its CEO. Removing human drivers and allowing trucks to drive more hours on the road will cut transportation costs by 50%, he said.
“Every truck’s economy is very positive, it’s profitable,” Lu said in an interview. “The more trucks we have in the network, the better our profitability.”
The red ink will turn black, “if we build these trucks by the thousands – not even tens of thousands,” Lu said. The company stated in its IPO filing that it has customer reservations for more than 5,700 trucks, but warned that those orders were not in line with revenue.
In a demonstration later that year, TuSimple plans to drive a truck with no human safety driver more than 100 miles behind the wheel, including at night, to show what its technology can do. However, this will be a one-time demonstration. The company is still expanding its hardware to make it durable and secure enough for automotive applications.
“This doesn’t mean we’re pulling the driver out of all of our trucks from that point on as the hardware we’re using isn’t even automatically rated and there’s still a lot of reliability and redundancy that we need to scale up. Said Lu. “But we want to show this as a large proof of concept.”
Investors have become skeptical of the arrival of free-range robo-taxis after delays and crashes slowed progress. However, the boom in online shopping combined with the growing shortage of truck drivers has led to investments in driverless delivery.
Major autonomous vehicle manufacturers, including Waymo from Alphabet Inc. and Aurora Innovation Inc. from Amazon.com, have set up on their own. The self-driving startup Argo AI, AV partner of Ford Motor Co. and VW, already wants to go public this year. Driverless truck startup Plus is in talks with acquisition companies for a merger, a route several electric vehicle manufacturers have brought public.
“When we founded the company in 2015, we knew that logistics would come first,” said Lu. “We move cargo, we don’t move people, so it’s obviously a different technological framework. I don’t know why it took some people five years to realize that. “