Uber's CEO Dara Khosrowshahi speaks to participants during the Viva Technologie show at Parc des Expositions Porte de Versailles on May 24, 2018 in Paris, France.
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By Glenn Fleishman
July 30, 2018

A promising program to put Uber in the driver’s seat for freight has hit the brakes: the company has stopped development on Otto, its self-driving truck project. The news, first reported by TechCrunch, was confirmed in a statement by Eric Meyhofer, Head of Uber Advanced Technologies Group. Otto garnered early attention by completing a 120-mile autonomous delivery in October 2016.

Uber said that it was shifting resources within its Advanced Technologies Group, which handles research on autonomous vehicles, to focus entirely on cars. Following a fatality in Arizona in March this year, after which the company stopped all its street-based driving tests, the company only last week returned to the road, starting in Pittsburgh.

The truck project was acquired from Otto, which operated in San Francisco, while Uber’s car development occurs in Pittsburgh, where the company has hired away a big portion of the local Carnegie Mellon University’s robotics group in 2015. Employees will be reassigned or offered severance, according to the company.

Uber’s entrance into self-driving trucks came with big headaches. Otto was co-founded by Anthony Levandowski, who had left Google’s autonomous car project, later spun off under the Alphabet parent company as Waymo. Uber put Levandowski in charge of its self-driving car program, but Waymo sued, claiming Levandowski had taken trade secrets about Waymo’s LIDAR system for use at Otto and Uber. (LIDAR technology provides continuous depth scans of the area around a vehicle, and complements conventional camera inputs.)

The case never reached trial. Uber fired Levandowski early this year, and under the leadership of new CEO Dara Khosrowshahi, who tried to defuse many outstanding conflicts, settled with Waymo by providing $244.8 million in equity in Uber. Uber also agreed not to incorporate Waymo’s confidential information into their hardware and software, although Khosrowshahi didn’t agree that trade secrets made their way into Uber. The other three Otto founders left by April 2018.

This business change doesn’t affect Uber Freight, which has nothing to do with driving. That company division, available throughout the continental U.S., is a booking service for truck drivers that Uber has checked out and let into the system to find loads to book. Uber said Freight’s load volume has doubled every quarter, and its tripled the size of its staff over the last 15 months. An analyst report today indicated Uber Freight targets a $15 to $20 billion logistics market, but it’s unclear how big a piece the company could claim.

This also isn’t necessarily the end of Uber’s truck efforts. Rather, the company said it’s maintaining its relationship with truck manufacturers and could return to this industry segment in the future.

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