Chinese start-up racing against Tesla to test robot trucks on roads of Arizona and Shanghai

A Chinese start-up with powerful backing plans to test a fleet of self-driving trucks in Arizona and Shanghai next year, competing with Uber Technologies Inc. and Alphabet Inc.’s Waymo in transforming the way goods are delivered.

Haulage is ripe for disruption by automation because the industry faces a growing shortage of drivers and transporting cargo between fixed points is less complicated than city driving, says Chen Mo, 33, co-founder and chief executive officer of Beijing-based Tusimple, which is backed by Sina Corp., operator of China’s biggest microblogging site.

Self-driving trucks could cut logistics costs by 40 per cent in the U.S. and 25 per cent in China as they can run longer than human-piloted rigs without rest and save at least 10 per cent on fuel, Chen said. They could also improve safety, especially in China, where trucks kill about 25,000 people a year, according to the Ministry of Public Security.

“It’s natural for us to start the business simultaneously as both countries feature a trucker shortage and huge cargo transportation demand,” Chen said in an interview in his office in Beijing. “China’s trucking industry is costly, inefficient and dangerous” and Tusimple’s technology “can reduce the casualty rate to 25 per cent of the current level.”

The startup plans to order 60 to 100 specially retrofitted trucks for the tests from a U.S. truck maker and China’s Shaanxi Heavy Duty Motor Co. The vehicles will have 10 cameras, three radars and a control system to analyse traffic conditions. The plan, regulations permitting, is to introduce commercial services in 2019, initially on two routes: a 120-mile (193 kilometres) highway stretch between Tucson and Phoenix in Arizona, and a 20-mile leg between a Shanghai port and warehousing, after completing 3 million miles of road tests in a year.

Instead of selling the automation technology to logistics firms or fleet owners, Tusimple plans to get into the haulage business. Chen said the industry in China is more fragmented than in the U.S., with large numbers of truck owners who lack proper training or insurance.