October 2019

Earlier this week, Raphaël wrote about the role for no-fault insurance in an age of automated vehicles. The post raised several important questions about the future of the auto insurance industry as technology advances:

Who do we want to protect? Passengers, for sure. But drivers? There is no driver! Or rather, there are many drivers. To some extent, at least under a layman’s understanding of the term “driver,” all the actors along the supply chain are driving the AV. Or, to be more precise, it is difficult to pinpoint a single driver: the “operator”? The software designer? And that is already assuming that there is a single entity who designed the software or operates what may be a fleet of AVs. And there may be others, as the AV industry continues to evolve

While Raphaël’s questions will be extremely important for the industry going forward, I want to pose a slightly different question here: Should drivers of Level 4 or Level 5 automated vehicles be required to purchase insurance at all?

Today, every US state except New Hampshire and Virginia require vehicle owners to purchase auto insurance. In a world where human drivers are in control of the vehicle, this makes sense. While flawed product designs or other manufacturer errors may contribute to car accidents today, many if not most accidents also involve some element of operator error.

In a world of fully autonomous vehicles however, this will no longer be the case. The human sitting in what is today the driver’s seat will not be in control of the vehicle in any meaningful way. Every movement such a vehicle makes will have been designed and programmed by the manufacturer or some company along its supply chain.

Given the extent of manufacturer control, would it be reasonable to have accident payouts determined by the law of products liability? Or perhaps, as Michigan Law professor Kyle Logue argued in a recent article, liability should be apportioned through a scheme of strict enterprise liability, in which automakers would be “unconditionally responsible for the economic losses resulting from any crashes of their vehicles.”

Even with the heightened manufacturer liability that may accompany highly autonomous vehicles, some room may be left for owner error, and thus for traditional insurance. Owners may be held responsible for routine maintenance of their vehicles, for ensuring software is upgraded in a timely fashion, or for actions taken if the vehicle is ever taken out of autonomous mode. But even if some minimal level of owner responsibility leads lawmakers to reject Professor Logue’s theory of enterprise liability in favor of maintenance of insurance requirements for owner/operators, insurance’s role will surely be different than it is today.

Which brings me back to a version of Raphaël’s questions that I started with. Who is the true operator of an AV, and what are they responsible for? Answering these background questions will go a long way towards determining the future of auto insurance in the era of automated vehicles.

In a recent article published on Reuters Regulatory Intelligence, a DC-area lawyer said the following regarding the potential of implementing no-fault insurance “to” automated vehicles:

“Drivers have an inherent incentive to drive safely, so as not to be injured or killed on the roadways. That inherent incentive is what mitigates the “moral hazard” of a no-fault system. But in a no-fault model for autonomous vehicles, the incentives toward safety would be degraded given that manufacturers do not suffer the physical consequences of unsafe operation, as do drivers.”

Intuitively, this seems right. Yet, I thought: is there more to it? What does a world with an AV no-fault insurance scheme would look like?

This might be puzzling at first: what does one mean with no-fault AV insurance? In a more standard setting, a no-fault insurance system means that one gets the benefits of their own insurance without regard to the actual “fault” (such as negligence) and that civil suits on the basis of one’s fault are banned or severely restricted. No-fault systems are straightforward and predictable, although potentially less “just,” to the extent that a negligent driver may get away with nothing more than a deductible to pay or eventually a higher premium.

There was, and there still is, a good policy ground behind no-fault systems around car accidents: avoiding the social cost of civil litigation, and shifting the financial cost of such litigation towards the insurers, between whom things are more often than not settled out of court. Those we want to protect with no-fault insurance schemes are drivers (and passengers), and that is a majority of the population.

Now let’s consider AVs. Who do we want to protect? Passengers, for sure. But drivers? There is no driver! Or rather, there are many drivers. To some extent, at least under a layman’s understanding of the term “driver,” all the actors along the supply chain are driving the AV. Or, to be more precise, it is difficult to pinpoint a single driver: the “operator”? The software designer? And that is already assuming that there is a single entity who designed the software or operates what may be a fleet of AVs. And there may be others, as the AV industry continues to evolve; we can already see that various paths are taken by industry players, some acting for a form of vertical integration, others relying on a variety of suppliers, in a less streamlined way.

Do these all these industry players deserve extra protection? They are all corporate entities after all, and as the lawyer mentions in the above article, none of them are subject to physical injury in case of an accident. While expensive litigation can drive corporations to the ground, the case for shifting costs to insurers, when it comes to AV drivers, appears less clear. What is clear, though, is that human victims of an accident involving an AV ought to be as protected as if the accident did not involve an AV, and maybe even more.

The final answer will come from lawmakers. Moreover, one should not forget that no-fault insurance is mandatory only in a minority of US states, despite being prevalent in the rest of the world. Yet I believe there might be a case here to adopt a legal scheme which would both guarantee a litigation-free recourse to human accident victims, potentially in the form of an industry-funded guarantee fund, while giving the opportunity to the various players along the supply chain to fight it out, in court if need be, on the basis of the reality of their involvement in the cause of the accident; they are all sophisticated players after all and all share in the benefits of the risk they create. The stories of human victims, though, are what may “kill” the industry, if not enough care is taken to ensure a high level of legal protection.

October 2019 Mobility Grab Bag

Every month brings new developments in mobility, so let’s take a minute to breakdown a few recent developments that touch on issues we’ve previously discussed in the blog:

New AV Deployments

This month saw a test deployment of Level 4 vehicles in London, which even allowed members of the public to be passengers (with a safety driver). Meanwhile, in Arizona, Waymo announced it will be deploying vehicles without safety drivers, though it appears only members of their early-access test group will be riding in them for now. We’ve written a lot about Waymo, from some early problems with pedestrians and other drivers, to the regulations placed on them by Arizona’s government, to their potential ability to navigate human controlled intersections.

Georgia Supreme Court Requires a Warrant for Vehicle Data

This Monday, the Georgia Supreme Court, in the case of Mobley v. State, ruled that recovering data from a vehicle without a warrant “implicates the Fourth Amendment, regardless of any reasonable expectations of privacy.” The court found that an investigator entering the vehicle to download data from the vehicle’s airbag control unit constituted “physical intrusion of a personal motor vehicle,” an action which “generally is a search for purposes of the Fourth Amendment under the traditional common law trespass standard.” Given the amount of data that is collected currently by vehicles and the ever-increasing amount of data that CAVs can and will collect, rulings like this are very important in dictating how and when law enforcement can obtain vehicle data. We’ve previously written about CAVs and the 4th Amendment, as well as other privacy implications of CAVs, both in regards to government access to data and the use of CAV data by private parties.  

Personal Cargo Bots Could Bring Even More Traffic to Your Sidewalk

In May, as part of a series on drones, I wrote about a number of test programs deploying small delivery bots for last-mile deliveries via the sidewalk. A recent Washington Post article highlights another potential contender for sidewalk space – personal cargo bots. Called “gita” the bot can travel at up to 6 mph as it uses it’s onboard cameras to track and follow its’ owner, via the owner’s gait. The bot’s developers see it as helping enhance mobility, as it would allow people to go shopping on foot without being concerned about carrying their goods home. For city-dwellers that may improve grocery trips, if they can shell out the $3,000+ price tag!

Even More Aerial Drones to Bring Goods to Your Door

Last month, as part two the drone series, I looked at aerial delivery drones. In that piece I mentioned that Google-owned Wing would be making drone deliveries in Virginia, and Wing recently announced a partnership with Walgreens that will be part of that test. Yesterday Wired pointed out that UPS has made a similar deal with CVS – though it remains to be seen if the drones will have to deliver the infamously long CVS receipts as well. As Wired pointed out, drugstores, since they carry goods that could lead to an emergency when a home runs out of them (like medication and diapers), speedy air delivery could fill a useful niche. So next time you’re home with a cold, you may be able to order decongestant to be flown to your bedside, or at least to the yard outside your bedroom window.

P.S. – While not related to any past writings, this article  is pretty interesting – Purdue scientists took inspiration from the small hairs on the legs of spiders to invent a new sensor that can ignore minor forces acting on a vehicle while detecting major forces, making it easier for CAVs and drones to focus computing power on important things in their environment without getting distracted.

While AVs have a lot of technological leaps to make before widespread deployment, developers and governments alike also need to also consider the human factors involved, including good old fashioned human fear. Earlier this year, a AAA study showed that almost three out of four (71%) Americans are afraid to ride in an AV. This is a 10% rise in apprehension from earlier studies, a trend that could be connected to the publicity around the 2018 Uber crash in Tempe, Ariz., where a test vehicle struck and killed a pedestrian. This lack of trust in AVs alone should be concerning to developers, but in some places that lack of trust has turned into outright enmity.

Test deployments, like the one undertaken by Waymo in Arizona, have become the targets of anger from drivers and pedestrians, including an incident where man pointed a gun at a passing Waymo test vehicle, in full view of the AV’s safety driver. In that case, the man with the weapon (who was arrested) claimed he hated the vehicles, specifically citing the Uber crash as a reason for his anger. Waymo test vehicles have been also been pelted with rocks, had their tires slashed, and motorists have even tried to run them off the road. The incidents have led to caution on the part of Waymo, who has trained their drivers on how to respond to harassment (including how to spot vehicles that are following them, as witnessed by a group of Arizona Republic reporters last December). Arizona is not the only place where this has happened – in California, during a 3 month period of 2018, 2 of the 6 accidents involving AVs were caused by other drivers intentionally colliding with the AV.

So where is this anger coming from? For some in Arizona, it was from feeling that their community was being used as a laboratory, with them as guinea pigs, by AV developers. Ironically, that line of thought has been cited by a number of people who currently oppose the deployment of test AVs in and around Silicon Valley. It’s rather telling that the employees of many of the companies pushing for AV testing don’t want it to occur in their own towns (some going as far as to threaten to “storm city hall” if testing came to Palo Alto…). Other objections may stem from people seeing AVs as a proxy for all automation, and the potential loss of jobs that entails.

So what can be done to make people trust AVs, or at least accept them enough to not run them off the road? On the jobs front, in June a group of Senators introduced a bill to have the Labor Department track jobs being displaced by automation. Responding to the changes brought on by automation is a center point of Democratic Presidential Candidate Andrew Yang’s campaign, and the issue has been raised by other candidates as well. The potential of automation to take away jobs is a long-standing issue made more visible by AVs on the road, and one that won’t be solved by AV proponents alone. What AV supporters have done and can continue to do is attempt to educate the public on now only potential befits of AV deployment (which PAVE, an industry coalition has done), but also better explain just how AV technology works. At least part of the AV fear stems from not understanding how the tech actually operates, and transparency in that vein could go a long way. Future test projects also need to be sure to get input from communities before they start testing, to ease the feeling of AVs being imposed upon an unwilling neighborhood. A recent debate over AV testing in Pittsburgh, where the city obtained funds for community outreach only after approving testing, leading to push back from community members, is a good example of how a proper pre-testing order-of-operations is vital.

For now, there is clearly a lot of room for public engagement and education. Developers should take advantage of this period where AVs are in the public eye without being widely deployed to build trust and understanding, so that once the vehicles start appearing everywhere they are met with open arms, or at least tolerated, rather than ran off the road. After all, while AVs themselves may not feel road rage, it’s already clear they can be victims of it.

P.S. – If you’re interested in learning more about negative reactions to robots, a good starting point is this NY Times article from January 2018.

In 2015, Google’s parent, Alphabet, decided the time was ripe for establishing a subsidiary in charge of investing in “smart infrastructure” projects – from waste to transport and energy. Its aim was specifically to implement such projects, transforming our urban landscape into a realm of dynamic and connected infrastructure pieces. Fast forward two years, and Sidewalk Labs had become embroiled in a smart city project covering a somewhat derelict (but highly valuable) area of the Toronto along the shores of Lake Ontario. 

Already in 2001, the Canadian metropolis set up the aptly named Waterfront Toronto (WT), a publicly-controlled corporation in charge of revitalizing the whole Lake Ontario waterfront along the city. WT then published early in 2017 a “Request for Proposals,” looking for an “investment and funding partner” for what would become known as the Quayside project. By the end of the year, the Alphabet subsidiary was chosen by WT.

It is important to note that this project was initially thought as a real estate one, and the desired innovation was to be found in building materials and carbon neutrality, while achieving certain goals in terms of social housing. There was no express desire for a model “smart city” of any sort, although the document does mention the usage of “smart technologies,” but always in the context of reducing building costs and improving the carbon footprint. 

Critics were quick to point out the puzzling choice; as innovative as it may be, Alphabet has no experience in real estate development. Rather, its core business is data processing and analytics, sometimes for research and often for advertisement purposes. What was meant to be a carbon-positive real-estate project seemed to be morphing into a hyper-connected (expensive) urban hub. 

And then came Sidewalk Labs’ detailed proposal. The visuals are neat; tellingly, there is not a single electronic device to be found in those pictures (is that one man on his cellphone?!) The words, however, tell another story. Carbon footprint and costs of building take a second seat to (personal) data processing: “Sidewalk expects Quayside to become the most measurable community in the world,” as stated in their winning proposal. One wonders whether the drafters of the proposal sincerely thought that, in this day an age, such a statement would fly with the public opinion. 

Critics of the project (who have since coalesced in the #BlockSidewalk movement) used the opportunity to dig deeper into WT itself, highlighting governance issues and the top-down character of the original Request for Proposals, beyond the plethora of data privacy questions (if not problems) the Sidewalk Labs proposal raised. In response, Sidewalk Labs deployed a vast campaign of public relations, whose success is far from guaranteed: they have “upgraded” their project, aiming for a bigger plot of land and even a new light rail plan (funded mostly on public money). At the time of this writing, WT has yet to make its final decision whether to retain the project of the Alphabet’s subsidiary. 

What lessons can we draw from this Toronto experience? “Smart city” projects are bound to become more commonplace, and while this one was not meant as such, some will be more straightforward in their aims. First, we should question the necessity of connecting every single thing and person. It matters to have in mind the social objectives of a given project, such as carbon footprint or building costs reduction. Collection of personal data can thus be articulated around and in function of those objectives, rather than as an end in itself. Connecting the park bench may be fancy, but for what purpose? More down to earth, the same question can be asked of street lights. 

As Christof Spieler reminds us in a recent tweet thread, certain municipal governments may be approached with “free” turnkey projects of connected infrastructure, in exchange (oh wait, it’s not free?) of both data and integration of the developer’s pre-existing systems into that infrastructure. Think of advertisements, and all the other possible monetization avenues… As Spieler points out, monetized smart infrastructure may come at a heavy social cost. 

Beyond that, one may wonder – who do we want as developers of such projects? Do we need the Sidewalk Labs of this world to realize the post-industrial heaven shown in the visuals of the Proposal? How will multinational data crunchers with an ominous track record make our cities smarter? The burden of proof is on them.

I recently wrote about a renewed federal push to regulate automated vehicles. I’ve previously highlighted a range of state regulatory schemes, including California’s relatively strict set of regulations. Meanwhile, the advent of truly automated vehicles, which seemed imminent when Waymo announced its driverless shuttle service in Phoenix, now may be farther away than we expected. Waymo’s shuttle’s still have human safety drivers, and the technology has not advanced as quickly as expected to handle all the vagaries of the road.

But as Congress and the states struggle to get a regulatory handle on this new technology, a recent Tesla update raises an important question. Is the regulatory state agile enough to adapt when the automated vehicle market evolves in unexpected ways?

Last week, Tesla unveiled “Smart Summon,” a feature in some vehicles that allows the user to summon the car to their location. With a range of 200 feet, Smart Summon is primarily designed for use in parking lots. At least one video shows its successful use in a Costco parking lot, avoiding pedestrians and other vehicles to meet its owner at the storefront. However, the feature is not limited to use in parking lots, and videos have emerged of users trying out Smart Summon on public roads, and even running in front of their vehicle to try and make the car chase them. Despite the potential dangers this technology presents, no one has yet been injured or hit by a driverless Tesla being summoned.

Despite the seriousness with which California takes automated vehicle regulation, state authorities have determined that Teslas equipped with Smart Summon are not autonomous, and thus do not need to meet California’s AV standards. Based on regulatory definitions, this is probably the correct. A state DMV spokesperson said the state defines AVs as vehicles able to drive without active physical control or monitoring by a human. Smart Summon requires a user to be attentive to their smartphone. Furthermore, its inability to operate more than 200 feet from a human controller means that it would not satisfy SAE autonomous driving level four or five.

Despite not being a true AV though, it’s clear that Smart Summon presents many of the same dangers as one. It operates in unpredictable parking lots, filled with pedestrians and vehicles and shopping carts all moving around each other in unpredictable ways. It is the sort of environment that can get dicey for a human driver, with our experience and understanding of the subtle signals humans give off to make an otherwise unexpected move a little bit more predictable. And despite a small-print company warning that Smart Summon requires “active driver supervision,” the amount of supervision anyone can truly give a moving vehicle from 200 feet away is certainly questionable.

And yet, these vehicle are not AVs. Instead, they seem to fall within an increasingly muddled gray area of transportation that is something short of fully automated, but requires much less than full and active driver attention. In California’s current regulatory environment, this technology fits neatly into a gap.

A year ago, many people assumed we were rapidly approaching the rise of Level 4 automated vehicles that could operate smoothly on city streets. Regulations developed at the time are written with that sort of technology in mind. Even one year out, legislators were not thinking of how to assure the safety of something like Smart Summon.

So how should something like Smart Summon be regulated? What will autonomous—or semi-autonomous—technology look like a year from now, and how can government agencies prepare for it? Given the unpredictable nature of an early stage technology, regulators will continue struggling to answer these questions.

The European Union recently adopted new rules to help consumers repair household appliances like refrigerators and televisions. The rules require manufacturers to provide spare parts for years after sale – the number of years depending on the device. The “Ecodesign Directive” is intended to help protect the environment by extending the life of consumer appliances. The regulation also applies to servers, requiring firmware updates for 7 years post-production. These regulations are part of a larger battle over consumers’ right to repair their belongings, including vehicles. Vehicles are already part of the right to repair discussion, and the deployment of technically complicated CAVs will ramp up that conversation, as some manufacturers seek to limit the ability of individuals to repair their vehicles.

One current battle over the right to repair is taking place in California. In September of last year, the California Farm Bureau, the agricultural lobbying group that represents farmers, gave up the right to purchase repair parts for farm equipment without going through a dealer. Rather than allowing farmers to buy parts from whomever they’d like, California farmers have to turn to equipment dealers, who previously were unwilling to even allow farmer’s access to repair manuals for vehicles they already owned. A big part of the dispute stems from companies like John Deere placing digital locks on their equipment that prevent “unauthorized” repairs – i.e. repairs done by anyone other than a John Deere employee. The company even made farmers sign license agreements forbidding nearly all repairs or modifications, and shielding John Deere from liability for any losses farmers may suffer from software failures. Some farmers resorted to using Ukrainian sourced firmware to update their vehicle’s software, rather than pay to hire a John Deere technician. The California case is especially ironic, as the state has solid right to repair laws for other consumer goods, requiring companies to offer repairs for electronics for 7 years after production (though companies like Apple have been fighting against the state passing even more open right to repair laws).

In 2018, supporters of the right to repair were boosted by a copyright decision from the Librarian of Congress, which granted an exception to existing copyright law to allow owners and repair professionals to hack into a device to repair it. The exception is limited, however, and doesn’t include things like video game consoles, though its’ language did include “motorized land vehicles.”

So how could battles over the right to repair influence the deployment of CAVs? First off, given the amount of complicated equipment and software that goes into CAVs, regulations like those recently adopted in the EU could help extend the lifespan of a vehicle. Cars last a long time, with the average American vehicle being 11.8 years old. Right to repair laws could require manufactures to supply the parts and software updates needed to keep CAVs on the road. New legislation could protect consumer access to the data within their vehicle, so they don’t have to rely on proprietary manufacturer systems to know what’s going on inside their vehicle. A 2011 study of auto repair shops showed a 24% savings for consumers who used a third-party repair shop over a dealership, so independent access to data and spare parts is vital to keeping consumer maintenance costs down. People are very used to taking their cars to independent repair shops or even fixing them at home, and many consumers are likely to want to keep their ability to do so as CAVs spread into service.

P.S. – Two updates to my drone post from last week:

Update 1 – University of Michigan (Go Blue!) researchers have demonstrated a drone that can be used to place shingles on a roof, using an interesting system of static cameras surrounding the work-site, rather than on-board cameras, though it remains to be seen how many people want a nail gun equipped drone flying over their head…

Update 2 – UPS has been granted approval to fly an unlimited number of delivery drones beyond line-of-sight, though they still can’t fly over urban areas. They have been testing the drones by delivery medical supplies on a North Carolina hospital campus.

(Re)Writing the Rules of the Road

A write-up of the afternoon sessions is now available here!

March 15, 2019 – 10:00 AM – 5:30 PM

Room 1225, Jeffries Hall, University of Michigan Law School 

In the case of automated driving, how and to whom should the rules of the road apply? This deep-dive conference brings together experts from government, industry, civil society, and academia to answer these questions through focused and robust discussion.

To ensure that discussions are accessible to all participants, the day will begin with an introduction to the legal and technical aspects of automated driving. It will then continue with a more general discussion of what it means to follow the law. After a lunch keynote by Rep. Debbie Dingell, expert panels will consider how traffic law should apply to automated driving and the legal person (if any) who should be responsible for traffic law violations. The day will conclude with audience discussion and a reception for all attendees.

(Re)Writing the Rules of the Road is presented by the University of Michigan Law School’s Law and Mobility Program, and co-sponsored by the University of South Carolina School of Law.

Schedule of Events

Morning Sessions 

  • 10:00 am – 10:45 am

Connected and Automated Vehicles – A Technical and Legal Primer

Prof. Bryant Walker Smith

Professor Bryant Walker Smith will provide a technical and legal introduction to automated driving and connected driving with an emphasis on the key concepts, terms, and laws that will be foundational to the afternoon sessions. This session is intended for all participants, including those with complementary expertise and those who are new to automated driving. Questions are welcome. 

  • 10:45 am – 11:15 am
Drivers Licenses for Robots? State DMV Approaches to CAV Regulation

Bernard Soriano, Deputy Director for the California DMV and James Fackler, Assistant Administrator for the Customer Services Administration in the Michigan Secretary of State’s Office, discuss their respective state’s approaches to regulating connected and autonomous vehicles.

  • 11:15 am – 12:00 pm
Just What Is the Law? How Does Legal Theory Apply to Automated Vehicles and Other Autonomous Technologies?

Prof. Scott Hershovitz    

Human drivers regularly violate the rules of the road. What does this say about the meaning of law? Professor Scott Hershovitz introduces legal theory and relates it to automated driving and autonomy more generally.                  

Keynote & Lunch

  • 12:00 pm – 12:30 pm
Lunch

Free for all registered attendees!

  • 12:30 pm-1:30 pm

Keynote – Rep. Debbie Dingell

Rep. Dingell shares her insights from both national and local perspectives.  

Afternoon Sessions

(Chatham House Rule)

  • 1:30 pm – 3:00 pm
Crossing the Double Yellow Line: Should Automated Vehicles Always Follow the Rules of the Road as Written?

Should automated vehicles be designed to strictly follow the rules of the road? How should these vehicles reconcile conflicts between those rules? Are there meaningful differences among exceeding the posted speed limit to keep up with the flow of traffic, crossing a double yellow line to give more room to a bicyclist, and driving through a stop sign at the direction of a police officer? If flexibility and discretion are appropriate, how can they be achieved in law?

A panel of experts will each briefly present their views on these questions, followed by open discussion with other speakers and questions from the audience.

Featured Speakers:

Justice David F. Viviano, Michigan Supreme Court

Emily Frascaroli, Counsel, Ford Motor Company

Jessica Uguccioni, Lead Lawyer, Automated Vehicles Review, Law Commission of England and Wales

  • 3:15 pm – 4:45 pm
Who Gets the Ticket? Who or What is the Legal Driver, and How Should Law Be Enforced Against Them?

Who or what should decide whether an automated vehicle should violate a traffic law? And who or what should be responsible for that violation? Are there meaningful differences among laws about driving behavior, laws about vehicle maintenance, and laws and post-crash responsibilities? How should these laws be enforced? What are the respective roles for local, state, and national authorities?

A panel of experts will each briefly present their views on these questions, followed by open discussion with other speakers and questions from the audience.

Featured Speakers:

Thomas J. Buiteweg, Partner, Hudson Cook, LLP

Kelsey Brunette Fiedler, Ideation Analyst in Mobility Domain

Karlyn D. Stanley, Senior Policy Analyst, RAND Corporation

Daniel Hinkle, State Affairs Counsel, American Association for Justice

  • 4:45 pm – 5:30 pm 
 Summary and General Discussion                                     

Participants and attendees close out the day by taking part in wide discussion of all of the day’s panels.

Last week I covered the various companies who are seeking to use aerial drones to deliver goods to your door. Today, in the third part to my series on delivery (you’ll find Part 1 here, and an even earlier post on delivery, from December of 2018, here), I’m going to look at recent proposals to use automated vehicles to deliver consumer goods.

As an introduction, I’m going to include a paragraph from that December 2018 post as an introduction to some of the ways automated vehicles are being used to make deliveries :

The potential for CAVs as delivery vehicles is already being tested by companies like Domino’s and Kroger, among others. Earlier this year Toyota announced delivery partnerships with Amazon and Pizza Hut, and Waymo’s CEO recently highlighted it as an area of opportunity.  This week the New York Times profiled Nuro, the start-up working with Kroger to test robotic delivery cars in Scottsdale, Ariz. Nuro’s vehicles are designed in-house, and look like “toasters-on-wheels,” and are currently followed everywhere they go by human safety drivers in conventionally driven “shadow car.” When the vehicle stops for a delivery, customers enter a PIN code into a small touch pad to open the compartment containing their order. The current charge for same-day delivery using the system is around $6. Ford has also flagged the delivery market as an area they’d like to explore, citing projections that by 2026 the last-mile delivery market for CAVs will hit $130 billion.

Don’t Forget to Tip Your (Robotic) Delivery Driver – Dec. 21, 2018

Since that post, Domino’s has announced a partnership with Nuro as well, with plans to test in Houston at some point this year. Walmart has also jumped in on the action – partnering with another AV developer, Gatik. For now Walmart’s test is limited to a 2-mile route between two of their stores in the company’s hometown of Bentonville, Arkansas. Why the interest? In part because of the potential cost savings – a recent Ford estimate calculates AVs could reduce the cost per mile for deliveries from $2.50 to $1. No doubt the combination of lower costs and ever-greater demand for delivery is a powerful motivator, pushing companies to explore not only AVs, but also drones and delivery bots, as discussed in Parts I and II of this series.

Beyond last-mile deliveries, there is a great deal of interest in automating semi-trucks and other large delivery vehicles. One company, TuSimple, is working with both the U.S. Postal Service (USPS) and UPS to move packages between cities. Interestingly, in UPS’ case, the company only announced the partnership after TuSimple had already been delivering goods for months – which seems to indicate the program is not just a grab for positive PR. The USPS’ test was more limited, running for two-weeks and five round trips. All of the trips included a safety driver and an engineer, and both tests were carried out in the Southwest. Meanwhile, in Sweden, a completely driverless electric truck was deployed in May, a global first. Given a nation-wide shortage of truck drivers (a recent estimate puts the U.S. deficit at roughly 60,000 drivers), automated trucks present a solution that doesn’t overly disrupt a truck-heavy commercial delivery system.

But what would the wide-spread adoption of AVs as part of the delivery ecosystem mean? We can already see that the demand for faster and faster delivery is taking its toll. Recently, the NY Times and Buzzfeed News both published articles detailing the human cost of Amazon’s push for same or next-day delivery. Under-trained drivers pushed to the limit have killed people in seemingly avoidable accidents that don’t often happen with more highly-trained delivery drivers (like those used by the USPS, UPS, and FedEx). Amazon has avoided liability by using a number of third-party companies as contractors, making those companies, and not Amazon, responsible for accidents. AVs would certainly be safer for the public, as they wouldn’t fall prey to the pressures of human drivers, though that does nothing to alleviate the pressures on the human delivery people, who would still be needed to move goods from the vehicle to a door. At the same time, Amazon may continue to escape liability, if the AVs remain owned by third parties. There is also the greater question of the environmental impact of the growing number of delivery vehicles on the road (not to mention the waste created by packing materials and shipping boxes). I’ll leave a greater discussion about those issues to future posts and other forums, but those questions, among so many others (privacy, cybersecurity, and traffic management among them) are important to consider as automated delivery vehicles of all kinds begin to fill our streets and skies.

P.S. – In a follow up to last week’s blog, the USPS has stated to investigate the use of aerial drones, and is now seeking information from drone operators and developers.