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Despite Uber's Self-Driving Truck Delivery, Truck Drivers Won't Be Losing Their Jobs Anytime Soon

By Daniel Sparks – Updated Nov 7, 2016 at 1:29PM

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Anheuser-Busch InBev's Uber-powered self-driving beer run may not be as exciting news for autonomous vehicles as it sounds. Here's why.

Last week, Uber showed off the technology of Otto, the self-driving truck company it recently acquired: It sent a self-driving truck on a 120-mile beer run, successfully delivering 50,000 Budweiser beers in Colorado on Oct. 20.

Image source: Otto.

"This milestone marks the first time in history that a self-driving vehicle has shipped commercial cargo," said Anheuser-Busch InBev (BUD 2.88%) in an Oct. 25 press release, "making it a landmark achievement for self-driving technology, the state of Colorado, and the transportation industry."

If A-B InBev could deploy trucks like this for all of its deliveries, the company believes it could reduce fatalities on the road and save money thanks to more fuel-efficient driving and higher truck utilization.

But there were several caveats to this stunt. Indeed, the delivery arguably makes just as strong of a case for the hurdles to deploying this technology as it does for its recent progress.

Here are a few takeaways, which offer up some useful reality checks for investors, from A-B InBev and Uber's self-driving beer run.

This "self-driving" truck needed a driver

One critical caveat to this self-driving beer run is that the truck only navigated from highway on-ramp to highway off-ramp without the help of a driver. Since Otto's self-driving technology isn't suited for more complex urban areas with traffic lights, stop signs, and crosswalks, the driver was still critical to transporting the beer from one destination to the next.

The technology needs some work

Autopilot. Image source: Tesla Motors.

Unlike the way Tesla Motors' (TSLA 2.48%) autopilot technology and similar automatic-steering tech from other automakers only work with driver oversight, the truck truly drove itself on the highway, without any need for the driver to keep hands on the wheel. Indeed, once Otto's self-driving truck hit the highway and the driver put the truck in self-driving mode, the truck driver was able to relax in the sleeper cab.

Still, Otto co-founder and president Lior Ron admitted (via Bloomberg), "We are still in the development stages, iterating on the hardware and software."

In fact, to ensure the truck could make the delivery safely, Uber's Otto unit "spent two weeks scoping out the driving route from Fort Collins to Colorado Springs, carefully mapping the road to make sure the technology could handle it," Bloomberg said. "The team wanted the trip to take place in the early morning when traffic would be relatively light and on a day when the weather was clear."

It's expensive

Highlighting another problem with self-driving technology, the hardware and software enabling this feat doesn't come cheap. Sporting cameras, radar, and LIDAR laser detection units, the truck had $30,000 worth of Otto's hardware and software, according to Wired.

Image source: Otto.

Of course, a $30,000 add-on for a commercial vehicle aimed at dramatically improving safety and fuel efficiency could probably be justified by large companies like A-B InBev, but it's expensive enough to likely offset any savings for many commercial customers -- and definitely too expensive to be deployed in consumer vehicles.

Regulation isn't ready

Finally, one of the biggest holdups to self-driving technology is regulation. The Otto unit needed to receive explicit permission from Colorado regulators and arrange police supervision of the delivery, Bloomberg said.

In Tesla's most recent earnings call, CEO Elon Musk detailed the challenge of collecting relevant and convincing data and subsequently getting regulatory approval for self-driving technology:

I think the timeframe that we think it is ready and then the timeframe that regulators will approve, you've got to present the data to them, they've got to think about it, and they've got to render a verdict and that can sometimes be a long process. And it can vary quite a bit by jurisdiction.

While Uber's self-driving truck delivery does demonstrate the technology's potential, it also puts the spotlight on technological limitations, high costs, and regulatory hurdles.

There's still lots of work left before autonomous vehicles can go mainstream -- and before truck drivers need to start worrying about job security.

Daniel Sparks owns shares of Tesla Motors. The Motley Fool owns shares of and recommends Anheuser-Busch InBev NV and Tesla Motors. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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