The Future of Trucking:
Mixed Fleets, Transfer Hubs, and More Opportunity for Truck Drivers
Many people have questions about self-driving vehicles and the impact they could have on their lives and professions. In the trucking industry in particular, some have raised concerns that self-driving technology will result in the loss of millions of jobs. While concerns are understandable, they don’t account for the technical realities of self-driving technology or the industry’s evolving demographics and economics. Most analyses spring from the assumption that self-driving trucks will replace drivers, and then try to quantify how many jobs will be lost. Our team of engineers, computer scientists, and CDL-holding truckers are working on a different approach that we think will lead to a more optimistic outcome. No one knows exactly what the future holds but we want to share our perspective and start an open conversation.
At Uber, we’re investing in both self-driving trucks and Uber Freight, a free app that matches carriers and their drivers with loads to haul. Late last year we shared our vision for the future of trucking: a mixed-fleet system where truck drivers and self-driving trucks work alongside one another, connecting long and local haul routes. We think this model could mean more growth in truck freight, an increase in better truck driving jobs, and more affordable goods for everyone.
Aging drivers and increasing demand for freight
To understand the potential impact of change, we first have to look at how the industry is evolving today. There are two problematic trends for trucking. The average age of a truck driver today is 49, compared to 42 for the average US worker. 55% of truckers are over the age of 45 while less than 25% are younger than 35 years old. The American Transportation Research Institute analyzed the data and found that the average age has been steadily increasing for decades.
One of the reasons for this is that driving a truck is a tough job. The hours can be long and grueling. Few other drivers on the road know how to drive safely around large trucks. And in some cases, trucking can keep drivers away from home for up to 200 nights a year. There are also structural reasons at play — for example, potential truckers have to wait until they are 21 to get their interstate CDL license, so many enter into other industries instead.
Looking at labor projections based on the current population of drivers, the American Trucking Associations estimates that over the next decade, more than 400,000 of today’s drivers will retire. Over that same time period, the ATA predicts that demand for freight will increase by 37%. If the industry continues down its current path, approximately 900,000 new drivers will be needed to keep up with future demand.
To meet this demand, the trucking industry will need to evolve. Driving jobs must become more appealing and accessible to attract a younger demographic, and the industry must become more efficient. We think that self-driving trucks can help.
Transfer hubs and mixed fleets
In our last post, we introduced the concept of transfer hubs — central exchange points that seamlessly connect automated long haul routes with drivers specializing in local hauls. Transfer hubs are an essential part of our vision for the future. We see them placed strategically across the country near cities and towns, bridging the gap between local and long haul trucking. Drivers transport goods from warehouses and factories to transfer hubs near highways. Then self-driving trucks, designed for highway driving, pick up the shipments and drop them off at another hub where other drivers take them to their final destinations.
The biggest technical hurdles for self-driving trucks are driving on tight and crowded city streets, backing into complex loading docks, and navigating through busy facilities. At each of the local haul pick ups and drop offs, there will need to be loading and unloading. These maneuvers require skills that will be hard for self-driving trucks to match for a long time. By taking on the long haul portion of driving, self-driving trucks can ease some of the burden of increasing demand, while also creating an opportunity for drivers to shift into local haul jobs that keep them closer to home.
Last year we kicked off a research project with economists and industry experts to better understand the potential economic implications of self-driving trucks and the transfer hub model.
We started by gathering historical data about the trucking industry. We examined freight volume, freight cost, driver wages, driver demographics, and employment through the US Bureau of Labor Statistics and other public sources. We used this data to project how many people would likely drive a truck in a future without self-driving trucks, and how many drivers would be needed to move freight around the country, splitting the market into local and long haul segments. We recognize that freight is more complicated than just long and local haul, but this segmentation made it possible to highlight the impact of our analysis clearly.
We created several scenarios that assumed different deployment rates of self-driving trucks and different levels of efficiency. In every scenario, we imagined only a few self-driving trucks on the road initially, with their numbers growing at various rates over the following decade. We also made assumptions about improvements in freight efficiency and operating costs. From there, we took a close look at the implications for both long haul and local haul driving jobs.
The charts below show how one of the scenarios plays out. In this scenario, we assumed approximately 1 million self-driving trucks on roads in 2028. (This doesn’t mean we think there necessarily will be 1 million self-driving trucks in 10 years — that would be very fast adoption — but this example helps highlight how things might change at scale). We also assumed that each self-driving truck could do the work of two of today’s trucks because they can operate at all hours of day and night. On average, trucks today spend less than a third of a given day on the road, according to the American Transportation Research Institute. Doubling their efficiency would mean self-driving trucks would be in use about the same percentage of time as commercial aircraft.
Here is what the analysis showed: In our baseline projections without self-driving trucks, the number of trucking jobs nationwide increased 766,000 by 2028. When we add self-driving trucks into the scenario above, truck driving jobs increase even more, with many long haul jobs shifting to local haul to support growing freight volume moving in and out of transfer hubs. Why? The deployment of self-driving trucks improves efficiency on long haul routes, lowering the overall cost of trucking and reducing the total cost of the goods being shipped. When goods are cheaper, consumers buy more of them. And when consumers buy more, more new goods need to be shipped than before, which drives truck freight volume up. In this scenario, when 1 million self-driving trucks are operating on highways, we would expect to see close to 1 million jobs shift from long haul to local haul, plus about 400,000 new truck driving jobs will be needed to keep up with the higher demand.
Every self-driving truck will need partners to cover local routes and bring loads to and from transfer hubs. Growth for self-driving trucks will therefore mean growth for truck drivers, on top of all the things we move getting cheaper and arriving faster. Additionally, those local haul truckers would be picking up and dropping loaded trailers, meaning big reductions in wait times at loading docks. And for drivers who prefer long haul, there will still be many routes across the country for years to come.
In total, we considered 9 scenarios. In each one, we saw the same overall trends when self-driving trucks were deployed — a shift from long haul to local haul and an overall net increase in trucking jobs. This doesn’t mean that the transition will be easy. In our model, the introduction of self-driving trucks did project a decrease in long haul wages (which partly drives the increased demand). Local haul jobs could see an increase in wages, but the jobs may not be dispersed equally across geographies and some remote truckers would likely have to relocate. It’s also possible that we’ll see the industry shift away from “per mile” pay and towards hourly rates in support of the local haul model, but that depends on many industry changes to policy and company structure that self-driving trucks won’t directly influence. It’s also important to highlight that any of these impacts would happen gradually over time.
There are other benefits that would arise from self-driving vehicles that were out of the scope of our research. The McKinsey Global Institute recently noted in a report that “new technologies have spurred the creation of many more jobs than they destroyed, and some of the new jobs are in occupations that cannot be envisioned at the outset; one study found that 0.56 percent of new jobs in the United States each year are in new occupations. Most jobs created by technology are outside the technology-producing sector itself.” The job increases we projected in this analysis do not include other new jobs that may arise out of the maintenance of self-driving trucks or the operation of transfer hubs, nor do they consider the broader job impacts in our economy.
Every self-driving truck will need partners to cover local routes and bring loads to and from the transfer hub. Growth for self-driving trucks will therefore mean growth for truck drivers, on top of all the things we move getting cheaper and arriving faster.
This research doesn’t give us a definitive answer on the future of trucking, but it helps us understand what could happen, using real economic data and insights about the actual products we’re working to build. We want to use this research to further the discussion around self-driving technology. We hope that others will examine our model, improve on it, and even change assumptions or create additional scenarios. So we’ve decided to open source the economic analysis, sharing our data and models on our Github page. We will continue to explore these questions, and encourage others to do the same. We welcome ideas, questions, and additional research to better understand what the future may bring for trucking.
Truck drivers will have more flexibility in the way they work
As the trucking landscape evolves with the introduction of self-driving technology, we hope to help drivers gain more control over their daily lives. Uber Freight is already changing the way carriers and their drivers use their time by connecting them with loads that suit their personal preferences. In the future, Uber Freight’s advanced load recommendations, combined with the efficiencies of transfer hubs, will give local haul carriers and drivers the flexibility to move a higher volume of freight within their working hours than they are able to today.
We don’t know exactly how fast self-driving trucks will become part of the industry, or how much impact they will have in the coming years, but we believe that they will help the industry, and the people who keep it running. In the coming months we’ll be sharing more about how self-driving trucks work and why we believe they have so much potential. We look forward to continuing this conversation with you.