The ride-hailing giant today launched Uber Freight, which takes the same model used in rider trips over to freight hauling.
Commercial truck and van operators can use the new mobile app to link up with end users who need cargo transported on city streets and highways. Uber Freight serves as the broker providing its mobile, cloud-based technology to interested parties.
The company has been testing Uber Freight for van deliveries since September. That’s taken place in the Texas Triangle region that goes between Dallas, Houston, and San Antonio and Austin.
Uber Freight wants to win over independent operators and large carriers nationwide. Drivers and carriers will have the process simplified on a mobile app, with a guarantee they’ll be paid within seven days.
Watch the video to see the heavy-duty trucking side of the business.
Uber Freight will involve human drivers. Since Uber’s acquisition last year of the Otto self-driving truck startup, it’s been assumed automated deliveries would be next in the queue.
Moving Otto forward has been stalled by a federal lawsuit filed by Waymo accusing the Otto founder, an engineer and previous Google employee, of stealing some of Waymo’s technology trade secrets for the Otto system.
The judge in that case ruled that the engineer, who had left Waymo to start Otto prior to the Uber acquisition, has to stay away from using some critical elements in the Waymo technology while the suit is being tried. Criminal charges are also being looked into by the U.S. attorney’s office by order of the judge.
A few Otto employees have transferred over to Uber Freight. However, the new Uber Freight division is entirely separate from Uber’s Advanced Technologies Group that oversees development of autonomous cars and trucks, said Uber Freight director Bill Driegert.
Uber is keeping quiet on how many trucking companies and independent contractors are using Uber Freight. Users can pay contract or spot rates, but the company isn’t disclosing what the rates are for now.
Interest from truckers is coming from the basic economic issue of how to best utilize assets tied to market demand.
“Uber’s disruptive impact has been almost entirely in its easy connection of underutilized assets with demand. That’s the start and finish of why it has swept across the transportation landscape,” said Michael Ramsey, an analyst at Gartner Inc. “An Uber for hauling stuff is sensible and really builds on what trucking companies have tried to do in their own ecosystem to ensure that trucks are full as often as possible.”
SEE ALSO: Otto Self-Driving Truck Tests in Ohio; Violated Nevada Regulations
Competition for playing the third-party broker role is intense among startups finding backing from private investors. Uber Freight is competing with other on-demand transport services such as Cargo Chief, Convoy, Doft, Flexport, HaulHound, Loadsmart, Parade, Ship Lync, Transfix, TugForce, and others.
The market has huge potential. Less than 5 percent of U.S. trucking lines are using on-demand freight services these days, said Wallace Lau, a commercial vehicle industry analyst at Frost & Sullivan.
Uber thinks that its reputation, while colored this year by legal controversies, will carry over well into freight hauling.
“Uber brings the tech capability and depth of resources and talent that nobody in the space can match,” Driegert said.
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