A transportation economist provides his perspective on automated vehicles.

February 2020

John Bendel

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Transportation expert Noël Perry sees autonomous vehicles coming to highways slowly and in stages.

“At some point, probably around 2030, the Pennsylvania Turnpike might say, ‘Anybody who has an automatic operation, we’re going to cut the toll,’” he said.

“Then a couple of years later, they’ll say, ‘In the Philadelphia area, because automatic operation improves capacity, we’re going to require automatic operation between the hours of 4 and 8 in the evening.’ Then finally, the Pennsylvania Turnpike will be automatic operation only,” Perry said.

Autonomous doesn’t mean driverless.

“You’ll have a human monitoring automatic operation,” Perry said.

But the human Perry referred to may not be what we think of as a CDL driver today. We’ll come back to that. First a little about Perry.

Noël Perry is chief economist for Truckstop.com as well as for TIA, the Transportation Intermediaries Association – the freight broker and third-party logistics trade group in D.C. He works through his own consultancy, Transport Futures.

Young Noël Perry worked on the dock for a small shipper before serving in Vietnam with the U.S. Air Force. With a bachelor’s degree from the University of Pennsylvania, Perry earned a master’s degree in Transportation Economics from Harvard. He went on to work in market research for Cummins the engine builder, CSX the railroad, and for Schneider, the orange truckload fleet from Green Bay, Wis. Since then, he has been on his own. According to his website, Perry “deals with all matters of freight transport within North America, with special emphasis on truckload, rail, intermodal and domestic water markets.”

So who is the human in Perry’s autonomous truck if not a CDL driver?

Driving a truck will be so much easier that CDLs won’t be necessary, or the requirements will be lowered, Perry explained.

“It’s called Level 4 automation, where the truck in normal circumstances will operate automatically but you have a guy monitoring it. Well, what’s the difference between that guy and a guy working in a parking garage? Nothing.”

That means, among other things, carriers will be able to pay future truck monitors less than they pay today’s truck drivers. There will be a lot of slip-seating.

“You can imagine somebody like Schneider, let’s say, has a major lane and small drop lots. There’s one in Green Bay, and for $18 an hour, a guy sits in one truck down to Chicago and comes back in another. Then somebody in Chicago sits in the truck to Columbus, Ohio, and comes back. The guy from Columbus sits in the truck to Philly.”

The important thing, Perry said, is utilization – keeping that truck rolling. That’s what makes the truck automation worthwhile.

But Perry is not sold on the automated truck with a monitor.

“The only place monitoring really helps is if the engine begins to misbehave, or let’s say you’re stuck in traffic and have to change lanes. For whatever reason, the computer won’t do it, but the monitor can,” Perry said.

Serious emergencies at highway speeds? That’s another matter.

“Humans monitoring automated systems doesn’t work. The latest example is the Boeing computer problem in the 737 Max,” Perry said.

Between October 2018 and March 2019, two new Boeing 737 Max airliners went down, killing 346 people. Faulty software is suspected in the crashes.

“The planes were human-monitored, but expecting humans to immediately diagnose a problem and apply the correct fix was completely unrealistic,” Perry explained.

“Being able to instantly diagnose a problem, overpower the machine, and apply the right solution? No way. We will require monitoring (on automated trucks) because we think it works. But it doesn’t work.”

According to Perry, automated driving systems will have to be virtually foolproof before it does.

Meanwhile, he sees another way to attain a greater level of utilization – and the profits that go with it.

“Remote operation is way more feasible than automatic operation,” he asserted. “The limitation right now is communication. The remote operator has to always be in contact with the truck. Once you solve that, it’s done.”

The remote operator, of course, is a human.

“A set of cameras will give a better view of the trucks’ environment than human eyes. You can sit in a nice air-conditioned office and drive a truck eight hours a day, then be home at night. Somebody else will slip into your computer station and the truck keeps moving. That’s almost certain to happen,” Perry said.

Starsky Robotics, a California start-up, is developing such systems.

How will all this impact owner-operators?

“It will be very difficult for owner-operators – not from an economic standpoint but from a human standpoint. The big fleets are used to making decisions from a business standpoint, from a capital standpoint. Many owner-operators like driving. They see it as a driving job. What’s going to happen is in 15 years it will be a capital-utilization job. It will be an asset-management job,” Perry said.

“If I have a truck, how do you best plug it into the system so you can get a return on your capital? That’s very different from saying, ‘I’m going to drive the damn thing.’ I fully expect, given the ferocious entrepreneurial drive many owner-operators have, that they will very quickly figure it out.”

In Perry’s view, today’s owner-operators will morph into something resembling small leasing companies.

“Right now, truck management is largely driver management, is it not? There are two things that are important in trucking. One is filling the truck. The other one is managing the driver. Everything else is minor. Filling the truck will continue to be an issue, managing the driver goes away, so what’s left?

“It’s positioning the assets and pricing them properly so they’re used. That’s a very different job. It’s quite likely, by the way, that small guys, including owner-operators, will generate the big winners of that new era because they’re entrepreneurial. When we went to deregulation, what happened? The big guys died and the small guys expanded.”

How long will we wait for these changes?

“Nothing’s going to happen over the next five years, but then we’ll begin to see successful commercial applications. By 2030 the end game will be visible, and by 2035 if you ain’t there, you’re dying,” Perry said. LL

Read more of John Bendel’s Gizmos & Gears columns here.

 

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John Bendel

John Bendel is Land Line’s contributing editor-at-large. A former trucker, former editor at National Lampoon, and longtime truck writer, John is an author, photographer, and freelancer for New York Times. There’s more, but in short, his insight and matchless style of writing makes “Gizmos and Gears” a runaway reader favorite.