TuSimple, a driverless truck startup in California, has achieved unicorn status — a valuation of $1 billion— after a series D funding round that brought in $95 million, according to a report by CNBC.
The money will help the San Diego-based company grow its fleet from 12 vehicles to 50 by June of this year. The money will also go toward helping the company develop partnerships and joint production operations with manufacturers. Currently, the company is working with two unnamed tractor-trailer makers.
The round was spearheaded by Sina Corp. and a Hong Kong-based investment company called Composite Capital. The company is readying tests of its self-driving semi trucks on highways in Texas and the southwest.
“By the end of 2020 or early 2021 we think we think we can take the driver out of the cab on trucks,” said Chuck Price, chief product officer of TuSimple.
The company wants to have trucks that can operate Class 8 tractor-trailers and get rid of drivers — the biggest expense for trucking companies.
Shipping companies, on average, spend $2 a mile transporting goods from one place to another, and TuSimple believes it can help trucking companies reduce that expense by 30 percent by eliminating the need for drivers.
Freight trucking is an $800 billion industry, and there are close to 3.5 million trucks on the road across the U.S. TuSimple thinks there’s plenty of room for growth.
“With e-commerce growing by double digits every year, freight shipping is not slowing down,” TuSimple CFO Cheng Lu said.
While many companies, such as Alphabet subsidiary Waymo, General Motors Company Cruise and Uber, have been focused on bringing autonomous passenger cars to the market, not much attention has been given to self-driving semis.
However, this could change once companies like TuSimple demonstrate the viability of the technology.
“A big milestone will be showing that on one route we can take out the driver completely,” Price said.