According to an Allied Market Research report, the global self-driving truck market is expected to grow 10% annually to $1.7 billion by 2025. TuSimple is an AI unicorn in the autonomous truck category.

TuSimple’s Offerings

TuSimple was founded in 2015 by Jianan Hao, Mo Chen, and Xiaodi Hou with a mission to make trucking simpler and safer across the globe. According to a recent report, it costs an average of $1.69 per mile to operate a long-haul truck. 40% of this cost accounts for the driver’s salary. In the US, truck drivers are hard to find and analysts estimate that the US freight industry currently faces a shortage of 100,000 drivers. Besides being expensive, trucking is also dangerous. Reports reveal that accidents involving large trucks increased 9% in 2017 to result in more than 4,700 fatalities.

TuSimple is hoping to change that. Based out of both China and San Diego, TuSimple is currently focused on providing a Level 4 autonomous truck fleet. Level 4 automation refers to a drive where the vehicle does not need a human driver, but the driver can intervene and take control as needed.

TuSimple has achieved this level of automation by installing a “supercomputer” directly into the truck. The computer comes loaded with more than 100 different AI modules that can help it with multiple tasks ranging from identifying objects on the road to determining the speed and distance of the vehicles surrounding the truck. It uses the Apache MXNet deep learning framework on Amazon Web Services along with data from cameras, LiDAR, and radar equipment mounted on the vehicle to build a real-time 3D model of the road.

The advanced algorithms analyze the data to determine the best decision for the truck to deliver a safe ride. According to TuSimple, its technology can help keep a loaded trailer operating at 65 mph at the center of a lane with 5cm accuracy. It has built the industry’s first 1,000-meter perception system that can operate in both good and bad weather conditions. TuSimple keeps a track of all the interactions its truck has on the road to keep testing and updating its algorithm.

As of September 2019, TuSimple had a fleet of more than 50 trucks and 18 contracted customers for its fleet. Last year, TuSimple was already operating in Arizona and making three-to-five daily deliveries for 12 customers. Not only are the deliveries bringing in some revenues, but also helping it test its model. TuSimple was looking to expand its deliveries in Texas as well. UPS is one of its customers that currently uses self-driving tractor trailers to carry freight on a route between Tucson and Phoenix to test if it can improve its service and efficiency using the TuSimple trucks.

The self-driving truck industry is expected to receive significant support from the government. In April 2019, California’s Department of Motor Vehicles announced that it will allow the testing of self-driving trucks on public roads. Additionally, the vehicle manufacturing players such as Daimler are getting interested in robotics companies and are acquiring them to accelerate the development of these vehicles. Daimler, for instance, acquired Torc Robotics, an American autonomous vehicle company, to incorporate the autonomous technology in trucks.

TuSimple’s Financials

TuSimple is privately held and does not disclose financials. It has raised $298 million in funding so far from investors including Lavender Hill Capital, Mando Corporation, UPS Ventures, CDH Investments, Composite Capital Management, Sina, and Zhiping Capital. Its last round of funding was held in September last year when it raised $215 million at an undisclosed valuation. An earlier round held in February 2019 had valued the company at just over a billion dollars.

TuSimple has been using the new funds to expand its fleet and continue to invest in technological development. According to market reports, in May last year, Amazon had expressed interest in acquiring the company, but TuSimple decided to remain independent.