TRANSPORTATION AND LOGISTICS BRIEFING: Consumers apprehensive about self-driving cars - Update on self-driving regulations - New details on Tesla's semi-truck

Welcome to Transportation & Logistics Briefing, a new morning email providing the latest news, data, and insight on how digital technology is disrupting transportation and delivery, produced by BI Intelligence.

Sign up and receive Transportation & Logistics Briefing free to your inbox.

Have feedback? We'd like to hear from you. Write me at: jcamhi@businessinsider.com.

SURVEY FINDS CONSUMERS APPREHENSIVE ABOUT FULLY AUTONOMOUS CARS: Automakers and tech companies are racing to develop self-driving cars, but consumers aren't ready to give up control of their cars to computers just yet. More than half (55%) of 1,500 US and German consumers surveyed recently by Gartner said that they would not ride in a fully autonomous vehicle.

The survey found that consumers want the ability to retake control of the car in case of a technology failure or security breach:

• Despite the concerns around fully autonomous vehicles, 71% of the respondents said they'd ride in a semi-autonomous vehicle that they could control at their leisure.
• The survey found that respondents were most concerned about the possibility of the car's technology either failing outright or being confused by a specific situation. The second most common concern was the possibility that the car could get hacked.

Public concerns about control over the car is one of the reasons that some automakers are taking a gradual approach to self-driving technology, rolling out advanced driver assist functionality first and then building up towards full autonomy. Tesla, for instance, has been periodically updating its Autopilot software with new capabilities, like self-parking, with the intent of eventually making the system fully self-driving. It will likely take decades of driving in semi-autonomous cars before consumers are comfortable enough for automakers to build fully autonomous cars without a steering wheel or pedals, the final level of autonomy.

However, semi-autonomous cars will require automakers to rethink the driving experience. Drivers will still need to be aware of what's happening on the road around them, and be able to immediately take control of the car in case of emergency. Tesla updated its Autopilot system late last year to warn drivers three times if they take their hands off the steering wheel while using the system. After the warnings, Autopilot's automatic steering function disengages, forcing the driver to take back the wheel. These types of solutions highlight the problem of relying on a driver in a semi-autonomous car - how to ensure drivers are alert and can react quickly if danger arises. This conundrum in handing off control between computer systems and humans is why Google and others have been focusing on fully autonomous cars that don't rely at all on a human driver. However, those cars will still need to provide humans the option to take the wheel when they want to in order to make them comfortable with riding in them.

BI Intelligence

CHALLENGES AHEAD FOR FEDERAL SELF-DRIVING CAR REGULATIONS: Despite a concerted push by automakers and tech companies to accelerate the development of self-driving car regulations, it will likely take years before federal agencies can release regulations for self-driving cars, according to Transport Topics News. A group of automakers issued a statement on July 13 pressing Congress to direct the National Highway Traffic and Safety Administration (NHTSA) to start drafting new regulations. Until now, the federal government has left self-driving car regulation up to state officials, leading to a confusing patchwork of state rules on the technology and its use on public roads.

Congress has shown that it recognizes the need to amend federal safety requirements to account for self-driving cars, and momentum seems to be building for new legislation. Earlier this summer, a bipartisan House panel voted unanimously to move forward with new legislation that would direct the Department of Transportation to create special exemptions for automakers from current federal safety standards, allowing them to expand their self-driving car tests. The bill would also direct federal regulatory agencies to start work on drafting new federal road safety rules for self-driving cars that would override any conflicting state regulations.

However, it seems unlikely that federal agencies will be able to quickly formulate new self-driving car regulations, even with a push from Congress. The NHTSA released non-binding guidelines last September to provide some basic safety protocols for companies testing self-driving cars, and plans to update those this coming September. However, drafting real regulations will require extensive field testing, as well as reaching a consensus among various stakeholders, including car companies and consumer advocacy groups.

Right now, the NHTSA lacks the budget and staff to conduct such wide-ranging technical work and industry outreach to form new regulations in anything less than five years, former NHTSA administrator Joan Claybrook told Transport Topics News. The administration remains without a director, and it seems unlikely to get much support from the White House, which has let its self-driving car task force fall apart in recent months. This is bad news for automakers and other companies developing self-driving technology, who may be left dealing with a confusing web of state regulations as they progress their testing efforts towards commercial launches.

Enjoy reading this briefing? Sign up and receive Transportation & Logistics Briefing to your inbox.

TESLA'S BIG-RIG TRUCKS WILL HAVE RANGE OF 200-300 MILES: Reuters reported new details surrounding Tesla's planned electric semi-truck, which it is expected to unveil in September. The vehicle will have a charging range of 200-300 miles, meaning that the vehicle will be targeted towards regional hauling. That's according to Reuter's source, an executive at fleet operator Ryder System Inc. who said he spoke with Tesla earlier this year about their trucking plans. Tesla itself declined to comment for the story.

The 200-300-mile range is consistent with the battery technology available today, according to researchers who spoke with Reuters. That would make the truck useful for medium-range trips, such as moving goods from a port facility to a nearby city, or from a distribution center to retail store location. The market for such regional hauls has declined in recent years, but still makes up about 30% of US trucking jobs, according to Fleet Compete, which analyzes trucking industry data.

However, regional hauls are expected to play a larger role in trucking going forward, and other truck manufacturers are eyeing this market as well. Earlier this year, Volvo released a new line of trucks, dubbed VNR, developed specifically for regional hauling. That's because regional trips are expected to increase in the coming years as digital and brick-and mortar retailers increase their warehouse networks to store more goods closer to their customers. That will likely reduce demand for long-haul trips, as well. Fuel cost are the biggest expense regional trucking fleets face and that could give Tesla's all electric Semi a strong selling point. However, Tesla has yet to reveal the vehicle's price, which many in the industry expect could be prohibitive.

In other news…

• Kansas City is is preparing for the future of transportation by embedding new sensors on its roadways with help from startup Integrated Roadways. The sensors will collect data about city traffic and road use to help with road maintenance projects and efforts to reduce traffic congestion. The sensors will include channels for connectivity, allowing telecoms to eventually run 5G networks through them. That could allow the sensors to share data with self-driving cars to provide more information about the cars' surroundings and improve their navigation.
• Amazon will expand its Amazon Locker program that lets customers pick up orders and drop off returns to some Whole Foods locations. Amazon started the program back in 2011 to provide customers with an alternative to home delivery, and has since expanded the program to more than 2,000 locations in 50 cities worldwide. Placing the lockers in Whole Foods locations could help Amazon drive its customers to those stores, which could lead to additional purchases during visits. This is the first clue Amazon has provided to how it will integrate Whole Foods locations into its extensive logistics network. It likely won't be long until Amazon starts experimenting with other ways to further that integration, including delivering groceries from Whole Foods locations.
• German politicians are excoriating the country's automakers for not moving fast enough to make their cars more friendly to the environment. The country's automakers have been swamped by the 2015 Volkswagen emissions-cheating scandal that later spread to include other carmakers, and a recent poll found that two-thirds of German citizens believed the government was too lenient with the industry after the scandal broke. With elections coming up, German politicians, including German Chancellor Angela Merkel, have repeatedly scolded the automakers and promised to hold them to stricter fuel emissions standards. Merkel's main challenger, Social Democratic Party chairman Martin Schulz, has promised to impose a quota for electric vehicles on the auto industry. That could be a significant burden on the country's car industry, which still remains heavily reliant on sales of diesel-powered cars.