Weekly Brief: AV’s Green Shoots Thrive under Pandemic Concerns

AutoX became the first autonomous vehicle company to deploy fully driverless cars in China last week.

The company is one of many that have been piloting AVs in China for the past several years. Some of these pilots have included passengers onboard but there has always been a safety driver behind the wheel until now. After six months of petitioning, AutoX received clearance to deploy its fleet of 25 AVs in the city of Shenzhen without safety drivers or remote operators.

Its vehicles can travel wherever they please within city limits, which should allow it to gather experience and data from a range of locations and driving environments. The company says it doesn’t plan to invite passengers onboard its fully driverless robo-taxis for another two or three years. It probably will follow a Waymo model at that time, wherein it introduces the vehicles to a select trial group and then expands to the general public. Like Waymo, AutoX has partnered with Fiat Chrysler Automobiles for its shuttles and it, too, is backed by a large search engine company, in its case Alibaba.

The pandemic is partly responsible for this milestone. The Chinese government has witnessed the surging demand for contact-free deliveries and is eager to expedite solutions. Two weeks ago it gave the greenlight to fried chicken company KFC, which started delivering food in self-driving food pods in Beijing in partnership with AV start-up Neolix. The food pods navigate city streets loaded up with fried chicken with zero people behind the wheel, the cook top or the cash register. Customers choose their orders with digital screens and pay with QR codes. The company is planning to roll out a similar autonomous, contact-free concept with Pizza Hut.

With AutoX going fully driverless, expect its competitors to try and follow suit in other Chinese cities. Baidu is active in Beijing and DiDi has a large driverless footprint in Shanghai. Each of these cities has its own quagmire of local restrictions and regulations to navigate, however, and there may be comfort in letting a competitor stick its neck out first.

Taking the pioneer role comes with real risks for AutoX. Driving in China is a less predictable, more manic activity than it is in the West. Traffic can be dizzying. Drivers default to aggressive. Pedestrians mingle with bikes and scooters. Shenzhen has a reputation in China as being a particularly hectic driving environment.

Yet the company ahs impressed local regulators with its software and hardware and thousands of hours of driving experience and it currently has the support of the government. The press has been positive, too, but if something goes wrong and one of its fully driverless AVs causes a fatal accident, for example, it could experience what Uber did in the US. That company plunged from a front runner in the self-driving car race to one buried in litigation and desperate to sell off its AV division. Hopefully that won’t be AutoX’s fate.

Now the company has ambitions beyond China. Earlier this year it received a permit to begin operating driverless trials in San Jose, California. Unlike in China, the company will be playing catch-up in the United States. General Motors’ Cruise has begun to test completely driverless AVs in San Francisco. More importantly, Waymo has commercialized a fully driverless robo-taxi service in Arizona and is looking to expand to select markets around the country. Last week Waymo announced two new facilities, one in Menlo Park, California, which will focus on the research and development of driverless semi-trucks, and a second in East Liberty, Ohio, where it plans to begin rigorously testing its AV fleet in harsh winter conditions.

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