Can driverless trucks deliver social gains as well as beer?

By Daniel Veryard, International Transport Forum

Convoy of yellow trucks on the roadTrials of automated taxis and buses are becoming a common sight in our cities. At the same time, driverless trucks are already moving containers and minerals around many mines and ports, sometimes without any human intervention at all. And although less visible, trucks might well be the first to cross the threshold of fully driverless operations on our public roads.

There are reasons for enthusiasm and for skepticism about predictions of driverless vehicles being allowed on our roads in the near term. Legal issues are numerous and contentious, the most obvious one being who will be to blame for a crash. Technical issues are also mind-blowing. How can computers armed with sensors match – and eventually exceed – the incredible processing power and intuition of the human brain?

Yet progress is being made on both fronts. Behind the scenes, governments and international bodies are working with industry to adapt regulation and road rules to a wholly new idea of what it means to drive a vehicle. There is a genuine motivation from governments not to stand in the way of the opportunities presented by automation.

Fierce competition

Amazing progress has been made on technical challenges in recent years. Advances in computing power, software and sensor technology have meant that in the space of just four years, computers have gone from dunce to top of the class in their ability to recognise objects and human faces. The same systems that can recognise over 96% of all images of physical objects are now being trained to recognise and respond rapidly to a huge array of real-world situations on our roads.

Fierce competition between incumbent vehicle manufacturers and new entrants seeking to disrupt the market for mobility is spurring large investments in research and development of driverless technologies. A large part of the EUR 44.7 billion that the automotive industry invests into R&D every year is dedicated to connected and automated driving.

On-road tests with prototype driverless trucks are already being carried out. Last year a start-up in the US working on autonomous trucks claimed the first commercial delivery (of beer cans) undertaken with a highly automated truck; the on-board systems handled all of the motorway sections of the journey without the driver monitoring operations. And European vehicle manufacturers worked together with governments to demonstrate the technical and legal feasibility of coordinating trucks from different origins to form automatically connected convoys of pairs and trios of trucks to travel together on a joint final leg of their journey to Rotterdam. Such technology would allow “platoons” of trucks to travel with only one person in the lead truck to be actively driving.

Huge cost advantages

Appetite among operators for the driverless technology is likely to be strong once it becomes available. The International Transport Forum (ITF) estimates that on long-distance routes driverless trucks could be operated with a cost advantage of 30% or more compared to conventional manned trucks. Drivers represent the biggest chunk of operational costs. Drivers are also a constraint on using trucks around the clock – they do need breaks to rest, after all. Making humans in the cabin superfluous means trucks could operate day and night without having to stop, except for refuelling.

The impacts that this transformation would have on driver jobs and livelihoods is not often discussed in policy and technical circles, however. Perhaps the threat of displacement for drivers is given less attention because the implicit assumption is that former drivers will quickly find alternative employment in growth sectors, such as personal services. While this possibility should not be dismissed out of hand, the stakes for drivers and for society at large are sufficiently high for us at ITF to decide that the labour impacts of driverless trucks were worth exploring in detail.

Driverless trucks cover

For this report, we teamed up with three leading transport-sector organisations – representing truck manufacturers, road freight operators and transport unions – to consider whether driverless road freight transport might be developed, allowed and adopted over the next two decades. In particular we wanted to understand what could be done to manage the labour impacts of the adoption of driverless trucks.

Redundant drivers

There are currently nearly 6 million professional heavy truck drivers employed across the US and Europe, according to ITF estimates.  At the current pay and conditions, hauliers struggle to attract enough qualified drivers. Projections tell us that without driverless trucks, around 6.4 million truck drivers will be needed across Europe and the US by 2030, yet fewer than 5.6 million will be available. Many of today’s drivers are nearing retirement age, and women and young people have not been taking up trucking. If these trends continue, driver shortages are expected to get worse – in Europe especially.

Driverless trucks could be used to gradually replace retiring drivers. However, the adoption of driverless trucks is likely to reduce demand for drivers at a faster rate than a supply shortage would emerge: Of the projected 6.4 million driver jobs in 2030, between 3.4 and 4.4 million would become redundant if driverless trucks are deployed quickly. Even accounting for prospective truck drivers being progressively dissuaded by the advent of driverless technology, over 2 million drivers across the US and Europe could be directly displaced by 2030 in some of the scenarios examined.

For businesses and displaced workers alike, large-scale and rapid adoption would be highly disruptive for future plans. The trucking industry is faced with the dilemma of trying to encourage people into driving roles right now, yet doing so would add to the ranks of people who need to be transitioned to new jobs when driverless technology is adopted. And for drivers or would-be drivers, the future roles in trucking may be more interesting, yet there may well be fewer of these jobs.

Disruptive automation

For today’s truck drivers the risks from driverless technology are profound. At a minimum, they may need to learn new skills to adapt to a new working environment in the truck cabin. Or they may lose their job altogether. While truck drivers are typically flexible, self-reliant and able to concentrate for long periods, they tend to be older and with less formal education. So finding and re-training for alternative jobs may not be straightforward, particularly as displaced drivers could face competition for jobs from workers being displaced from jobs in other sectors – after all, trucking will not be the only sector changed by automation.

Alternative job opportunities for displaced truck drivers will be created both in the trucking industry and beyond. However, whether a high-automation economy will generate enough employment and whether these jobs are suitable for displaced truck drivers, are both open questions.

These challenges partly stem from the uncertainty around the timing and extent of the labour market impacts from driverless trucks. Yet uncertainty does not mean we should stand back and let it happen. There are options for giving some control to the people affected. The ITF study proposed consideration of a permit scheme that would allow trucks to operate without driver only if in possession of an electronic certificate issued by the relevant authority (assuming a safety approval process had been developed and passed by the vehicle). The governments could sell such permits to road freight operators at auctions. The proceeds from the permit sales could be used to fund transition arrangements for displaced drivers, such as retraining programmes or, if need be, income replacement payments.

Managing the transition

The number of government permits issued each year could be set in consultation with an advisory board. This “labour transition board” should be temporary and include representatives from labour unions, road freight businesses, vehicle manufacturers and government. It would support the government in choosing the right policy mix to ensure that costs, benefits and risks from automated road haulage are fairly distributed.

The board could take account of various factors to ensure its recommendations maximise the potential benefits for society from driverless road freight. Balancing costs and benefits will require evidence on the evolving demand for driverless operation and developments in the labour market. If demand for the permits was high, permits would attract high prices (or be sold in large volumes), giving strong revenues for active labour market programs that year; more displaced drivers could be supported, suggesting the release of more permits could be a welfare-improving change the following year. Under this arrangement, policy makers would be specifically empowered and informed to make the trade-off.

The challenge of inequality

The approach proposed from the ITF and its partners should be seen as a risk management strategy in the face of an uncertain uptake of driverless technology. It is possible that the transition to automation in the trucking sector and elsewhere will proceed slowly and in an orderly fashion, with market forces smoothly directing unemployed drivers into new opportunities elsewhere. In such a scenario, the government’s intervention in transition would be largely unnecessary. In practice, the measures could be quickly withdrawn by issuing large numbers of permits or removing the need for permits altogether.

However, the rapid and unprecedented accumulation of computing power suggests that we may well reach a point where human labour is increasingly superseded. In such a scenario, the labour transition arrangements may well prove crucial in keeping humans in charge of their own futures before a strong set of vested interests are formed. Embedding this control into the fabric of the transition could make the adoption less risky from a social welfare perspective and more feasible from a political economy perspective. Transition arrangements for truck drivers may also help policy makers understand how to best respond to the broader challenges of inequality and underemployment that are proving difficult to tackle with existing policy settings.


Daniel Veryard is an economist with the International Transport Forum. He led the project on “Managing the transition to driverless road freight transport” which the ITF conducted jointly with the International Road Transport Union (IRU), the European Automobile Manufacturers’ Association (ACEA) and the International Transport Workers’ Federation.

“The future of transport is electric”

Jochen Eickholt Siemens Mobility CEOJochen Eickholt, the CEO of Siemens Mobility, talks about electric highways and bus networks and creating cities full of sensors that link up cars with their surroundings.

One of your projects at Siemens is electrifying motorways, so electric trucks can be used for long-distance freight, without even requiring batteries. Why are you convinced that the “eHighway”, as you call it, is the future of road freight?

Transport remains the last sector where fossil fuel dependency has not been substantially mitigated, making it a leading source of greenhouse gas emissions. Electric mobility offers a variety of benefits here, including improved local air quality, fuel diversification into renewable sources to reduce dependency on fossil fuels, and increased energy efficiency to lower operating costs. The eHighway combines resource-efficient railway technology with the flexibility of road transport.

How does this work in practice?

The adapted hybrid trucks are supplied with electricity from overhead contact lines. An active pantograph can automatically connect and disconnect with the contact line at speeds up to 90 km/h. The direct transmission of electric energy ensures an outstanding efficiency of 80 to 85 per cent from substation in-feed to the wheel. This is twice as high as that of conventional diesel engines. The eHighway also makes it possible to recover braking energy and store it on-board. It can also feed other trucks operating on the system or even feed the electricity back into the public grid. These energy savings translate into even higher system efficiency, lower emissions, and lower energy consumption. High efficiency is the backbone of future road freight transport as well as decarbonisation.

Talking about electric mobility, would you agree that it will play a vital role in reducing greenhouse gas emissions of  passenger transport?

The future of transport is electric, whether by rail or by road.  For metros, light rail and high-speed trains  electrification has been established for many years as a way to ensure highest energy efficiency while  minimizing local emissions. With the ongoing electrification of railroads all over the world, rail traffic has become increasingly emission free. According to a recent study by the International Railway Union (UIC), rail is the most emissions-efficient major transport mode. Electric trains powered by renewable energy can offer practically carbon-free journeys and transport.

In cities, eBuses will play a role similar to the one I just described for the eHighway and hybrid-driven trucks. They offer the same advantages -energy efficiency, local zero emissions and, thanks to modern control systems, an improved travel experience for passengers. This is why they are in a good position to help satisfy the increasing demand for sustainable transport solutions in cities at a time when growing transport volumes and limited expansion possibilities for transport routes pose ever more serious problems.

What kind of innovations do engineers have in store to make electrified public transport a regular sight?

It is possible for instance to equip buses with a flexible Offboard High Power Charger, which adds considerable flexibility to eBus services. The buses need to stop at the charging station only for a few minutes. The system is ideal for high-frequency operations, since the charging infrastructure can be used by several buses per hour. It would even work if the vehicles were produced by different manufacturers. This is no scenario for the distant future; in fact the system’s practical feasibility in daily operation is already being demonstrated – for instance in Vienna, Gothenburg or Hamburg.

Offboard High Power charger
Offboard High Power Charger in Hamburg (Photo: Siemens)

Everyone is talking about self-driving vehicles. What is your take on autonomous driving?

The next step in the evolution of green, safe and efficient public transport on roads will be self-driving shuttle buses. At present there are several pilot projects under way, in areas such as university campuses and still operating with a driver as a back-up. Over the long run, electric-powered self-driving cars will be the new norm for individual and shared traffic in our cities. They are safe, emission-free and silent. But there is still a long way to go – infrastructures are not ready for that phase yet.


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What needs to happen in terms of infrastructure?


Today, self-driving cars run well only under certain conditions,-  in a controlled environment and when the weather is right. The sensors fail when it rains or snows; and they also fail when the sun is too bright. And even though they already are quite powerful, sensors can’t see around the corner or through an object that is blocking the sensors sight. Today, the human driver serves as a “redundancy system” that makes up for these defects. But without someone at the wheel, the self-driving car would have only one option: to switch to safe mode in uncertain situations. This is not acceptable, because it means having to reduce speed radically or even stopping. Neither alternative is compatible with traffic regulations and the requirement not to hinder the flow of traffic. And, even worse, passengers wouldn’t accept driving in a slow and stuttering vehicle.

Overcoming these restrictions first of all needs a different perspective. We need to move from a car-centered approach to a systemic approach. There have to be sensors not only in the cars, but on the road as well to monitor and process what’s going on there – and communicate what they see to the cars. Similarly, cars need to communicate with one another and with the infrastructure around them. The combination of  complementary roadside sensor networks, a reliable real-time communication network such as 5G, and autonomous electric-powered cars will form a systemic transport net for future cities. But without the appropriate infrastructure, such a vision will remain  science fiction.

Jochen Eickholt leads the Mobility Division of global engineering giant Siemens AG. He studied electrical engineering at Aachen Technical University in Germany and Imperial College London, UK. He was appointed CEO of the Rail Automation Business Unit in 2009 and became CEO of the Mobility Division in 2012. On 31 May 2017 he will join ministers and other leaders for a discussion of  “The governance of transport in the digital economy” in the opening plenary of  ITF’s 2017 Summit on “Governance of Transport”


“There is a lot of untapped potential in rail”

Troger3 lowres CroppedLaurent Troger, president of Bombardier Transportation, talks about how digitialisation impacts rail, the rise of the mobile economy and why he sees a bright future for rail travel.

Digitalisation is revolutionising everything. How is it changing rail transport?

I see digitalisation as a major accelerator, reinforcing the role of rail as a backbone of mobility in the 21st century and beyond. Societies around the globe are facing pressing challenges today: urbanisation, climate change and inclusiveness only to name a few. I believe rail is the answer to these challenges and digitalisation will significantly accelerate the pace of change. Only by embracing the accelerating process of digitalisation can we deal with the challenges of mass mobility, prevent traffic collapses, reduce pollution, improve safety and meet the demand of modern passengers by enhancing their travel experience.

And how does that play out in your company?

The way we approach digitalisation at Bombardier is to cover the complete value chain, making our production processes more efficient, improving asset management and increasing the safety and capacity of our transport systems through automation and predictive maintenance. At the same time, we will use new digital technologies to ease the passengers’ A to Z journey and focus on passenger comfort, reliability, availability and connectivity. There is a lot of untapped potential in the rail industry, just waiting to be unleashed.

Other modes are also reinventing themselves. Once self-driving cars and trucks become widespread, will that not undermine the business case for rail?

Lifestyles have changed, people are moving with different and changing patterns every day, optimized through modern technology. Mobile economy is the buzzword: it means working at home, working at different offices, in different places. In response to this trend, transport plans need to manage the fluctuating demand for services and increase flexibility. Passengers will have more options to choose from and will choose the best

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Automated People Mover in Beijing (Photo: Bombardier)

alternative depending on their specific needs. They need to be able to count on reliable services. And at the end of the day, the travel experience will be a decisive factor. Passengers value reliability, punctuality and connectivity. Ultimately, I believe that rail transport is, and will remain, an essential driver of the mobility ecosystem. Rail is green, safe, reliable and cost-efficient. And we will continue to innovate in order to improve the travel experience of our passengers by offering additional services, while other modes – such as Uber, or car- or bicycle sharing –make it easier for passengers get to and from the station.

Innovation cycles are getting shorter and shorter, but rail infrastructure is expensive and not built in a day. Will that not give other modes a competitive edge over rail?

You’re touching on a very valid point indeed. In our industry, innovation cycles have been painfully slow if you compare them to the start-up scene. However, the fact is that there are thousands of innovators around the globe who share our passion for developing smart and sustainable mobility solutions. They have lean, agile approaches and a fantastic entrepreneurial mind-set. I see this as an opportunity, rather than a threat. Why compete, when we can join forces? We see many new digital business models emerging in rail – and mobility in general. At Bombardier, we are closely following these trends and accelerating our digitalisation initiatives.

Why should investors bet money on the future of rail?

The world population is set to grow, and will increasingly be living in cities. Today, around 54 per cent of the world’s population lives in cities. By 2050, 66 per cent of the world population will live in urbanised areas and by the end of the 21st century, more

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ICE 3 high-speed train in Germany (Photo: Bombardier)

than 80 per cent of the world’s population will be urban. I am sure you’ve heard these figures before. They are both cause and effect of economic growth. They indicate that there will be hundreds of millions of increasingly well-off, educated people going to work, taking their children to school, visiting each other and going on holidays. One common theme for all of these cities worldwide is the challenge to organise and manage the constant flow of people and goods. So the market potential is huge. If you add the fact that economic activity worldwide is projected to pick up pace in 2017 and 2018, especially in emerging markets and developing economies, the global outlook for rail is very positive. 

Until the next economic downturn?

On top of that, this market is very resilient. As you probably remember, in 2008, at the peak of the crisis, our industry faced no significant downturn. Why? Because most of the politicians on the planet realized that investing into infrastructure projects, and in particular into public transport, is good for their economy. Unlike the airline industry, we in rail have always had steady growth in front of us and that also holds true going forward.

Laurent Troger is the President of Bombardier Transportation, one of the world’s leading manufacturers of planes and trains. Based in Montréal, Canada, Bombardier employs 66 000 people worldwide. Its rail division builds everything from sleek high-speed bullet trains to public transit rolling stock. On 31 May, Laurent Troger will join a debate on “The governance of transport in a digital economy” with, inter alia, China’s minister of Transport Xiapeng Li, OECD-Secretary General Angel Gurría and Siemens Mobility CEO Jochen Eickholt at the ITF 2017 Summit on “Governance of Transport”.