Don Burnette, CEO and co-founder of self-driving truck startup Kodiak Robotics, had an “aha” moment when the company started working with the U.S. Department of Defense.
Kodiak’s mission has always been to pursue long-haul autonomous trucking, but two years ago, the startup won a $50 million contract from the DoD to help the Army automate ground vehicles for high-risk missions. That deal provided Kodiak with access to much-needed capital during a challenging funding market; it also gave the startup a chance to test its self-driving stack in unstructured, off-road environments.
The experience unlocked an idea: Going off-road could provide a faster path to market than driving trucks on highways.
Kodiak this week announced plans to launch a fully driverless commercial trucking service by the end of 2024 or in early 2025, in partnership with Atlas Energy Solutions, a provider of proppant (i.e., sand) and oilfield logistics.
Kodiak and Atlas have been running driverless tests for a few months now. In May, the two completed Kodiak’s first driverless delivery run. A semi truck with no human driver on board — only Kodiak’s autonomous driving hardware and software stack — delivered frac sand for Atlas in West Texas’s remote Permian Basin. The 21-mile stretch of land where Kodiak drove has no paved roads or structure of any kind — only “cactuses and bushes out there,” said Burnette.
Driving off-road presents AV companies with a unique problem set. For example, the vehicle can’t rely on HD maps because oftentimes there aren’t any; off-road environments also change with different weather conditions.
Burnette said in Texas’ desert, “the sand is constantly shifting, and everything’s changing by the hour.”
“So the vehicle has to make sense of what is the drivable surface? How do you get to the destination?” said Burnette. “And that’s something that the technology at Kodiak has really honed over the last couple of years, and it’s especially been driven by our work with the DoD.”
The founder noted that, at least in Atlas’s case, going off-road provides a better product-market fit today than long-haul trucking.
Atlas’ sand-moving operations run 24/7, according to Burnette, which means the trucks are more expensive to operate because they require at least three shifts of drivers to keep them moving.
“So the value of autonomy in this particular domain is actually higher per truck than the value of over-the-road trucking,” said Burnette. “On top of that, given the structure of the environment, given the speeds, we were able to already validate our driverless operation with the technology that we had developed and that means we can effectively deploy this year.”
Kodiak still plans to pursue the long-haul trucking route in parallel to its work with Atlas and the DoD. But that path to revenue-generation is a much longer one. In order to be sustainable and eventually reach that goal, Kodiak needs to get paid much sooner.
Kodiak’s deal with Atlas will involve two trucks to start, with more being added down the line. The startup will run a driver-as-a-service model, where Atlas will buy the trucks directly from an OEM, and Kodiak will kit them out with its tech and provide ongoing support and monitoring services.
Kodiak isn’t the only autonomous driving startup to tap DoD money to pursue an off-road path to market. The Army earlier this year awarded Overland AI, another company developing a self-driving system for military operation, up to $18.6 million to build a prototype autonomous software stack for its robotic combat vehicle program. Overland is among a crop of startups and more mature companies carving out an off-road niche in the AV sector.
“I believe at this point,” said Burnette, “it’s the companies that find paths to profitability as soon as possible that are ultimately going to be the ones that win in the end.”
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