Podcast Transcript 306: Delivering Goods Autonomously

November 8, 2020

This week, we’re joined by Matthew Lipka, head of policy at Nuro. We chat about how autonomous delivery can help get people goods they need, the difference between transporting goods and people, and whether people can still pick their own produce.

This podcast originally appeared at Streetsblog USA and a full transcript below.

Jeff (-1h -1m -0s):
You’re listening to the Talking Headways Podcast Network.

This is Talking Headways, a weekly podcast about sustainable transportation and urban design. I’m Jeff Wood. This week, we’re joined by Matthew Lipka Head of Policy at Nuro. We chatted about how autonomous delivery can get people groceries, the difference between transporting goods and people, and whether people can pick their own produce. Stay with us.

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Jeff (42s):
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Jeff (1m 25s):
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Jeff (2m 6s):
Subscribe today. Matthew Lipka, welcome to the Talking Headways Podcast.

Matthew (2m 9s):
Well, thanks so much for having me Jeff, it’s great to be here. Excited to talk with you today.

Jeff (2m 13s):
Good to chat with you too. Before we get started, can you tell us a little bit about yourself?

Matthew (2m 18s):
Sure. So my current role is that I’m the head of Policy at Nuro. I live in Washington, D C, before this I was a transportation consultant at McKinsey. And went to law school, worked a bit in the federal government during law school. And I worked at the MTA in New York for a while as well.

Jeff (2m 36s):
What got you interested in cities and transportation?

Matthew (2m 39s):
I read a book called the Power Broker as a teenager. Familiar, I’m sure, to many of your listeners and you know he was kind of a hero and an antihero, Robert Moses is, in that book. And the thing that stuck with me was how consequential the decisions that were made 60 years ago. I’m from New Jersey and I have a lot of family in New York, so I grew up driving these roads and when we drive to the JFK, I would see there was no transit and that’s because of the decisions that were made, you know, 50 years ago. And when we drive to Jones Beach, I would see that there’s not room for buses to travel, because he wanted to make it impossible for black people to get to Jones Beach on buses.

Matthew (3m 21s):
And so that really just inspired me to see, you know, how permanent these changes are and how consequential. And of course, if there’s a, there’s a chapter in there about building one mile of highway through a vibrant neighborhood and how it basically disruptive the lives of thousands of people. And so I saw the, how it can be bad as well as how it could be inspiring with how great it was once you got to Jones Beach and made me excited to enter this field and, and see if we can make it a little bit better.

Jeff (3m 48s):
So let’s get into Nuro a little bit. What is Nuro and what was the initial impetus for the company?

Matthew (3m 54s):
Okay, so Nuro is a robotics startup. We’re about four years old and we’re building a fully autonomous on road vehicle specifically for goods delivery. So the original impetus for this, it was that our co-founders have been working in self driving for quite some time. One of them was on the original Google self driving car team, the other one ended up there after being in the DARPA Urban Challenge. And they felt, how can we get the benefits of this technology into people’s lives is faster. And they came up with the idea of focusing really on goods delivery. And I mean, local delivery, things like groceries, pizza, pharmacy, the errands we do everyday when we’re driving in our car.

Matthew (4m 38s):
And that that’s something that would be really powerful because we’re spending a huge amount of time doing shopping and errands. It’s about 43% of all the vehicle trips. So actually twice as much as commuting that we spend so much time focused on in our planning, but we could make a big impact in daily life getting time back. But also we can get this technology to market sooner in a way that actually helps people, because if you’re just focused on goods, there’s a number of things you can do differently, but most simply you focus on protecting everyone outside the vehicle instead of what’s inside the vehicle, and that lets you build a safer vehicle, let’s you make choices that are designed to prioritize others. And we’ve seen that already because Nuro is on the road and we are doing deliveries of groceries and a pharmacy in Houston today.

Matthew (5m 22s):
And we’ve been operating for about two years in, in Arizona and in Houston with a delivery service and that’s driven autonomously.

Jeff (5m 30s):
What are some of those differences between delivering goods versus delivering people when you have to say, go for approvals or when you’re designing the vehicle, those types of issues.

Matthew (5m 38s):
Yeah. So I’d say there’s a number of things there’s, you know, different kind of public trust environment, differences in regulation, differences in how you design the software and difference in how to design the vehicle. And then also in terms of the impact it has on society. So if we think about kind of technology to start, if you imagine you’ve come upon a brick on the road, right? A vehicle has no people on, it can slam on the brakes much, much harder than a vehicle that needs to think about occupant comfort, right? Because you might have whiplash or if you’re a passenger, but you can really focus on making decisions that are designed to protect, protect others. And that’s not just a brick, right? Also as a person on the road as well.

Matthew (6m 18s):
And you also can take more conservative route choices. We, we don’t have someone in the backseat that can be impatient, that lets us choose areas where we’re confident in operating Autonomously before we go to areas where it might be more aggressive. And that means we don’t have to take the shortest route in every case, we can take the safest route. Another big difference is in the design of the vehicle itself. And this is one that I’m particularly passionate about because I think that there’s a lot of things we can do better about our vehicle design and especially for pedestrian and cyclist safety. And so with Nuro we have built a custom vehicle it’s called the R2 for Robot Generation Two, which is a extremely creative name.

Jeff (6m 55s):
Are you sure it wasn’t a, a copy of Star Wars? (Laughs)

Matthew (6m 60s):
Well, it was not, Lucasfilm and Disney, it was not a copy of R2… The first one was called a R1 for Generation One. And so this is just the second one, but we’re investing so much in safety, then we didn’t invest in marketing! (Laughs)

Jeff (7m 15s):
(Laughs) I appreciate that a lot.

Matthew (7m 17s):
So anyway, so R2 is a custom vehicle, we built it in Michigan and in partnership with Roush and this vehicle is design from the ground up to be for goods delivery. There is no space for humans of any kind and you know, the biggest impact of that is that you’ve reduced the risk exposure on the roads by 50%. Because if anyone hits us no one in our vehicle can get hurt. We also can actually redesign the vehicle and start to rethink the car and say, how do we build a more, you know, socially responsible vehicle it could be narrower, we don’t have to have two seeds next to each other. That gives us an extra two to three feet to maneuver around pedestrians and cyclists. It can be lighter weight and we don’t have all the extra steel. This is designed for protecting pedestrians.

Matthew (7m 58s):
And that means that you can improve your stopping distance. And we can even rethink the design of the front of the vehicle. So Nuro’s vehicles are operating in neighborhoods cause that’s where grocery stores and things are, right. We’re in your neighborhood, so there’s a lot of pedestrians around. And so we really focused on that use case and thinking about the front of the vehicle, we said, why do we need a windshield? There is no one inside to see out. Why do we need an A pillar, which can be very damaging for a pedestrian in a collision, let’s change that into a crumple zone that absorbs energy, sacrifices the Goods inside, but prioritizes other road users. Now, thankfully our top priority is to never be an a in a crash. We haven’t been in, in any crashes, but this kind of design of the vehicle you know, we can reimagine. We’ve been thinking about putting an airbag on the outside of the vehicle for a few generations that is designed to protect a pedestrians head in the event of a collision.

Matthew (8m 45s):
So I think there’s a lot you can do to rethink the vehicle. So I’ll pause there for a minute before we go through my long list of five differences.

Jeff (8m 53s):
And the vehicle speed is low too. I mean, it’s not likely to get into a high-speed crash unless there’s another vehicle that crashes into it.

Matthew (8m 60s):
Right. That’s right. So right now our vehicles are limited to 25 miles an hour. It’s great from a technology perspective it’s great from a piloting perspective, it’s also driven a lot by the federal regulations that basically assume if you’re going over a 25 miles an hour, we’ve got to have manual controls, steering wheels, and brake pedals and occupant protection things like seatbelts and a driver’s seat. Don’t make sense if there is never going to be any one in the vehicle, but its great for an initial driving and in those communities, most of the roads are 25 mile an hour. Whereas we look to the future we don’t want to be limited to just a very select group of neighborhoods. We think that a 35 or 45 mile an hour vehicle could reach many more people in suburbs and rural areas.

Matthew (9m 42s):
And I think that’s important to recognize that ultimately we’re gonna need to go a little bit faster. One of the neighborhood’s in Houston that we’ve done some driving in is the Third Ward, which is a food desert and that community, you got to cross a high way to get to, and if you’re limited at 25 miles an hour, it’s difficult to reach places that by definition are further from supermarkets and reach them in a timely way with, you know, fresh, hot food. And so if we want to be the service to be more equitable, we know that our next generation, we are going to need to go a little bit faster.

Jeff (10m 11s):
You mentioned the Third Ward, you know, we had Mayor Turner on a number of episodes ago to talk about the Complete Communities Initiative, how of you all been engaged in that program specifically, and I know that you all are testing the vehicle in that space, but then you also had mentioned at one point in some of the stuff that I’d read that, you know, you were connected to that program, which is really fascinating.

Matthew (10m 31s):
Yeah, absolutely. So we opened our first depot in Houston in Gulfton, which has one of those Complete Communities. And this program the Complete Communities, is really designed to concentrate resources from the city of Houston and also private sector in these communities. And so we launched our first Depot there. And so that’s where many of our employees are located. Our Depot is where we store the vehicles, charge them overnight and maintain them. So that’s in one of these communities. And so we have gotten more connected with the city through that location, but I think there’s more, there’s more to do of course here, we’ve really tried to engage with the city to see what are their priorities and how can we help. And so we’re hoping to do more to advance those priorities in the future.

Matthew (11m 14s):
And the Complete Communities is a great place to start,

Jeff (11m 18s):
Have communities been more welcoming since they understand that your premises are a little bit different than passenger vehicles. It feels like there might be a little bit more openness to say testing if you know that the company is going 25 miles per hour, if they’re are focused on pedestrian safety, if they don’t feel intrusive, unlike some of the other self-driving passenger vehicle companies where they are testing their vehicles. And obviously there’s been some tragedies that have happened. Is there a difference in kind of feeling when you come into a community?

Matthew (11m 48s):
Absolutely. I think there’s three big things that people see that, that make them trust autonomous vehicles more. So the first is exposure. Second is whether it’s cargo or, or passengers and on the third, the, the speed. So there was a survey, it just came out this week or by the group Motional that found that only about 10% of people that say, I don’t know much about AVs would trust one to get it in it. And then people who say, I know a lot about it, 70% say they would get in it right. Once people actually understand how this technology works and have seen it in an action that is easier to trust and it’s really on us as an industry to go out and explain how this technology works, what the benefits of it are and how they can, their individual lives benefit from it.

Matthew (12m 29s):
And that’s why it’s so exciting to actually run a real service because people are actually interacting with this in a way that’s productive. It’s not just testing its actually dinner showing up at your door. I think the second thing is around cargo. There was another survey by the Partnership for Autonomous Vehicle Education that asked people what would make them trust the vehicle more. And the second highest rating thing was if it’s carrying cargo rather than passengers. And that just kind of makes intuitive sense. Its easier to trust a vehicle that it shows up at the curb would dinner with a pizza inside than it is to put your whole family in the back seat. And so we think it’s a great way to build trust in the technology for everyone. And then the third, as you mentioned, is having a lower speed and seeing at operate safely really can build more trust on this technology.

Jeff (13m 12s):
Going back to the question about, you know, passengers versus freight or cargo, how much easier is it to get approvals from cities and kind of goes back to that, your answer just Now but you all have gotten approvals to operate these vehicles, even though they don’t have steering wheels and, and side mirrors in all that stuff, how much easier it to get approvals in that sense than it is for a passenger vehicle?

Matthew (13m 32s):
Yeah. I think that it’s got to make a difference, right? You think about side view mirrors. There’s a reason we need side view mirrors in a passenger car. In addition to the driver, is that when you open the door, you want to make sure you’re not opening it up into a cyclist, right? So knowing that we’ll never have a pedestrian in the vehicle and that by the way, our vehicles have Gullwing doors that opens straight up on only on the curbside. So we’ll never door a cyclist, which I particularly appreciate as an avid scooterer and cycler around the, around the city. I think that this makes it intuitively easier. Plus the understanding that there’s no one inside the vehicle, it just reduces the risk exposure significantly. Because if you actually think about it, there’s nothing substantively different about when we’re operating this in a commercial service vs.

Matthew (14m 15s):
if we’re operating it just for testing, we are doing the same drive, either way, the question is just whether there was a pizza inside. So you’re not actually creating any risk exposure, you know, incrementally by allowing the operation’s. So I do think it resonates. Secretary Chao had a really good tweet when she announced the exemption that said, well, the vehicle is, is never going to have anyone inside. It doesn’t need mirrors or windshields. It just doesn’t make sense it.s Just common sense. I think that that is right, right. It’s intuitive to people that this doesn’t add safety to the vehicle. It just makes it a bit wider. And in some cases heavier and more rigid,

Jeff (14m 47s):
You all are focused on safety a lot more. It feels like then other companies and maybe that’s not fair to them, but you know, it feels like that. What brought you to that conclusion that it was important to think about all these other vulnerable road users and think about pedestrians and cyclists and everybody else that might be interacting with the vehicle on public streets?

Matthew (15m 8s):
Yeah. Well, I, I won’t speak badly about any other company. I think that, that the reason safety so critical, it was just the number one question for our communities and we’re operating in these neighborhoods and we need to build a trust if were going to have a successful business, one of our core values is do the right thing. And that means building a vehicle that is safe. And you know, even if it means we have to take a little bit longer to do something, then we will take that extra time to make sure that we operate safely. And we know in these communities we are often seeing pedestrians. And so that I think has really a reason for it to be a priority is because that’s what we’re seeing, seeing around us. You know, for me personally, I’ve been observing over the last many years at so many of the vehicles that our on our roads are, are getting bigger and wider and heavier and, and frankly more dangerous.

Matthew (15m 52s):
Now we’re at a point where three out of every four vehicles sold is an SUV or a pickup truck and there’s, you know, studies showing it’s two to three times more likely to kill pedestrian if you are hit by a, a, a pickup truck or an SUV than a sedan. And of course these are, the vehicles are also creating many more emissions right, over the last decade the second biggest cause of global carbon emissions was an SUVs, more than heavy industry, and more than trucks, just SUVs alone. And if we can, you know, if we go to these people and demonized them and say, you know, get out of your truck. That’s not gonna work. Right. 80% of truck owners say they’d give up alcohol before they would give up the keys to their truck. So I’m, I’m not going to try and ask you to do that, but why, why do you think we should do is that we should give them an option that’s the way better, right?

Matthew (16m 40s):
You get to stay at home. They don’t have to drive your truck to get your medicine. You know, one ounce pill bottle that half of all Americans need every month. Instead you can stay at home and we’ll send a light battery electric, smaller vehicle that’s designed for pedestrian safety. And so we need to still do all those things to make transit great, active transportation and make it a better land use decisions. We also need to, I think give people alternatives to these bigger trucks and SUVs that at least for some of their trips, make it possible to leave it in the garage and have the right size vehicle bring you your stuff.

Jeff (17m 15s):
What is the biggest push back that you all get?

Matthew (17m 18s):
Yeah, it’s a, it’s a good question. I think one big pushback we get is people want to see it in action to see for themselves, does it operate safely? So that really is just something that is going to take time in outreach. We also often got a question about automation. What’s the impact going to be on jobs, right? We’ve seen so many times and automation has meant eliminating jobs. And so I think we’ve talked a little about the safety issue, but we’ve actually seen in our initial deployments, a positive impact on jobs. And if you think about that in the grocery case, the reason is that grocery delivery is pretty nascent today and only about 3% have groceries delivered in 2019. Obviously that’s gone up during the pandemic so we’ll see what happens afterwards.

Matthew (18m 0s):
The reason that it’s still so low is the cost. It costs about 10 to $20 on average, to get your groceries delivered. And most families can’t afford to add that to the costs of every errand. And so we think that this technology can help reduce the cost of home delivery of things like groceries because electric, because its efficient with two compartments, it’s got, you know, autonomy. And I think that wIll help bring down the costs, make it more affordable from what people to get the delivery. And what happens then is since there’s so few groceries delivered today, those are replacing trips that you or I would take to the grocery store, right? When we’re doing this unpaid labor of picking and packing our own groceries at the store.

Matthew (18m 40s):
If a robot is doing the driving, then someone has to be hired to do that picking and packing. And so we’ve seen, you know, our retail partners are actually hiring more people and of course we are hiring people to do the testing and deployment and maintenance of these vehicles and building them. So I did, I do think this is a case where we’ll see some growth, maybe a little bit different than some of the other applications of autonomy, but we’re just at the beginning of this journey. And so I’m sure there’ll be other benefits that we see in the future, but we often get a question about jobs and I think it’s a little bit nuanced in different and a case of delivery.

Jeff (19m 12s):
So I’ve got kinda of a funny question, whether I’m a weirdo or not, I actually like going to the grocery store and even during the pandemic, it’s a way for me to get out of the house. It’s like my one trip now that is like my one trip to get out of the house. I also like picking my produce. I squeeze my avocados, at least pre pandemic I did, I like to check for mold on berries, I like to make sure that my garlic has not too small in the clove. Am I a weirdo in that sense? I feel like there’s, I understand that there’s going to be a number of different folks that want different things, but it’s interesting to hear that this is going to happen and perhaps delivery is the way or the future in a way that I don’t know if it’s meant for me personally.

Matthew (19m 51s):
Yeah. Well, so you’re not a weirdo. (Laughs) I’ve been getting a lot of harder avocados over the last few months of this pandemic getting groceries delivered. And actually it’s funny you mention produce that’s the number one thing that people say is blocking them from getting grocery delivery is they want to pick their own produce and that’s fine, right? We are talking about a $3 trillion market here. We don’t need to get a hundred percent of them to be delivered in order for this to be a valuable service to the community. What we found is that it’s really valuable for some people, people that are maybe really busy or may live far from a grocery store, someone that may be in a wheelchair that can’t drive themselves to the grocery store can have it delivered to them more affordably. So I think there’s a lot of people that it would be valuable for.

Matthew (20m 34s):
The other thing I’ll mention is there was a recent study that we commissioned. I’ve mentioned some of the economic benefits earlier, and this was studied by a transportation economist group called Steer. And we asked them to look at what’s the jobs, economic impact, hours saved. And as you might expect the numbers were quite big, right, it was over 4 trillion dollars of economic impact with 3 million jobs created from the period 2025 to 2035, right? So they said kind of the first five years and is still growing still nascent, but over the next 10 years this can start to actually get to scale. And they did three scenarios and that middle scenario in 2035, so 15 years from now and not the aggressive scenario, they said 23% of shopping and errand trips by car would be deliveries, right?

Matthew (21m 19s):
So this is less than a quarter of them. And it’s still having that massive of an impact. So I think as a society, we can get a lot of these benefits without actually having everyone do that. If you don’t to get delivered, that’s fine. There’s probably some things you don’t want to do yourself, right? It’s not just grocery, right? It’s also medicine. If you’ve got a sick kid at home, do you really want to be leaving them to go to the store or putting them in the car to go to the store to pick up them medicine? Maybe that’s something that you want delivered instead, but you still want to do your own grocery shopping. There’s all, there’s all these different errands that we do in the week and some of them we might want to get it delivered.

Jeff (21m 56s):
Another interesting thing from that report was that 21 billion hours of time would be saved from people not having to do trips. That was the one that kind of stuck out to me. Another question I have it’s kind of a, a little bit, well not ridiculous, but just, I felt like I wanted to be a little bit of a contrarian to a certain extent. Has anybody calculate the potential loss of like human interaction? You know, some of the only times when you interact maybe with people that are outside of your social circles are when you get on a bus or if you go to the grocery store or if you were in public in certain ways, is there something that’s been calculated that it talks about that kind of, that loss of connectivity with people around you?

Matthew (22m 27s):
I haven’t seen numbers on that, but it’s a, it’s a great point. We’re already seeing an increase in delivery, right? And how do we make sure that we are not losing that human interaction. Some of the best interactions with my community have been riding the bus and just talking to someone while I wait at the bus stop with, you know, 40 grocery bags. And, and so I do think that that’s really important. A friendly robot is nice. I’m sure it has some interactive value, but it’s not the same as actually getting to know people in your community. So yeah, we think as a, as a society, we need to still do that. I do think there are things that we could do with the time other than shopping and running errands that might be more valuable interactions.

Matthew (23m 7s):
So how do we make sure that the time we get back from this, you know, the 21 billion hours that we don’t use them just to a stream TV or to just work longer hours? I was reading about the washing machine and the dryer and the vacuum. And when the vacuum came out, it saved a ton of time. And that, especially for what at that time was mostly women doing housework, and it is still today often women. But the, what ended up happening is people spent that additional time on cleaning twice as often, right? That’s not what we want people to have to do with this extra time. So I think as, as a society, we need to make sure that we have, you know, great things that people can do.

Matthew (23m 48s):
They have the childcare, they need to go out and do what they’re passionate about, that they have access to the transportation to those valuable enriching facilities that they’ve got good access to parks where they can, you know, teach their kids to play basketball and so forth. Make sure we are investing in our communities broadly so that we can use this time that might otherwise have fortuitous interactions to do more fortuitous interactions in our communities while having maybe a little more fun.

Jeff (24m 13s):
Do you see a difference in street design and the future that would accommodate more of these delivery vehicles?

Matthew (24m 22s):
So everything that a human driver needs to drive safely is helpful for a autonomous vehicle, right? Clear lane markings, well maintained roads, protected bike lanes, all of that is, is helpful. And so when we’ve seen people and the city’s talking about safer streets and Vision Zero, all that actually is really helpful for us. Because it’s meaning that we have the infrastructure for automotive vehicles to, to operate safely and, and protect the vulnerable road users. So if you’ve heard some people say, Oh, we should make pedestrians install something on your phone or have a beeper on them so that we don’t…no, that’s not the answer. I don’t think that that’s right. Some people say we should reinvent our infrastructure and have new dedicated lanes.

Matthew (25m 2s):
I don’t think more lanes is as the answer, we really think that we should imbed in the existing infrastructure and operating the world that as it is and put everything on our vehicle that we need to, to operate safely. I think that’s the best way to go. As it is now, we struggle to maintain all of the infrastructure we have, especially in the roadways. And we aren’t investing as much as we need to in other modes. So asking our government to build new infrastructure is probably not the best strategy to grow our service. I think everything that’s good for a community will help us in the end as well.

Jeff (25m 33s):
Your vehicle is a bit larger than some of the other delivery vehicles that I’ve seen in the wild. There’s the smaller ones that folks worry about driving on sidewalks and things like that. I imagine that your vehicle is designed specifically for streets alone and not other pathways.

Matthew (25m 48s):
Exactly. Yeah. Just for the street, so we’re not a sidewalk robot. I think the reason for that is,

Jeff (25m 55s):
(Laughs) It sounds like a funny.. “sidewalk robot”!

Matthew (25m 58s):
I’m sure they prefer another term, but just to distinguish, we don’t go in the sidewalk, we go down the road, it’s a motor vehicle and ultimately we’ll be going 45 miles an hour, hopefully one day, which means you definitely won’t be on the sidewalk for that. I think the problem that we have often heard an urbanist and, and mobility communities is that America is built around the car in many cities. And so if you have a sidewalk, robot or bike lane robot, you’re not going to be able to reach most of America in Houston were we launched is about 6200 miles of roadway, and less than half of those have a sidewalk. There was actually not a good count available on this. And there is about 300 miles of bike line. And so you’re not been able to reach most people there.

Matthew (26m 40s):
And that’s fine. I think that all different kinds of robots are valuable. We don’t want to discourage any of the others. They can be really, really good in certain applications that are close by, but we also have a mission of serving everyone and it’s very difficult to get too a food desert, for example, or to get to a rural area, if we can’t go on the road. And so we thought about starting with a sidewalk robot, but just with our mission of trying to serve everyone couldn’t we couldn’t do it with that technology. And so that’s why we ended up going with an on road vehicle.

Jeff (27m 9s):
I think 75% of those bikeways in Houston are probably at my old neighborhood of Kingwood. (Laughs) If you look at the map of bikeways in Houston, just looking at an overall map, there’s this big cluster of them in the top right hand corner of the map. It’s funny.

Matthew (27m 25s):
I’m sure that’s not a coincidence to why you were in Kingwood.

Jeff (27m 28s):
(Laughs) What’s the most fun use case that you’ve heard for the potential of your vehicle?

Matthew (27m 34s):
Oooh. So I’ll give you two. So one that I really like is peer to peer, so we think about Craigslist. And do you wanna go to someone’s house to meet them, you know, is it going to be exactly what you said it would be, you know, could we use these vehicles where you, you know, you buy something online, they load it in a Nuro bot and it brings it to someone else. Right? Reuse. So I really like that idea. I also think that something that’s like a neighborhood bot, right? That has kinda, what are those, those are the most common things you need i your daily life and you just call it. And it is there within five minutes. We’re a big bakers in this household. So yeast, flour, right? A bakery bot. I have no how many times I’ve gone to the store and then come home and realize I’ve forgotten something that is critical to baking cake and having to go back because it’s always worth it for cake.

Matthew (28m 19s):
Those are my two preferences. I’m sure that we can think of probably some other fun ones too.

Jeff (28m 24s):
At the beginning of the pandemic, I decided to go big on my baking and, and I bought the 50 pound sack of flour. So no more going the store for flour. I bought a, a container and everything. It’s, it’s under my kitchen table and it goes, actually we’ve already been through 50 pounds, which is surprising for two of us. (Laughs)

Matthew (28m 48s):
That’s pretty impressive. We’ve definitely gone through quite a lot. Most recently got some shortbread and apple cider donuts.

Jeff (28m 52s):
Nice, nice. Last week we saw numerous transportation agencies, including MTC here in the Bay Area discuss the potential for reducing greenhouse gas emissions through working at home. You know like our example here was I think they said that they wanted to make it 60% work from home for large companies. And if you look at what the coronavirus has done to the peripheral economics of downtowns, restaurants and services, I start to worry about what cities look like on the ground if everything’s is delivered. Is there a dark side to autonomous delivery? And we kind of covered this before in my previous silly question. But you know, I’m wondering if there’s just kind of like a dark side into taking away that space from people interacting downtowns from peopl working at home all the time, being connected, those types of things. That’s a different kind of phrasing of the question, but I’m wondering if you all have thought about this.

Matthew (29m 40s):
Yeah. It is something we’ve thought a lot about. I actually think that our technology is designed to revitalize local commerce. You know, last year, 11% of all retail was done online. Now it’s up to 16%. So that means 84% in the Coronavirus is still local commerce in person. But that 16% is taking off critical profits from local businesses. So I think that if you’ve got a situation where these small local businesses don’t have the opportunity to compete, maybe they don’t have enough volume to justify building a Amazon style warehouse or you know, investing in their own proprietary truck for delivery, but they still need to compete with the free online delivery and it takes two days, well, what if they had a service like Nuro so that they can sign up with a really, really easily and offer delivery within 30 minutes for a price, you know, that’s as close to free as we can get it?

Matthew (30m 29s):
That can actually help them compete and help them stay open instead of everyone that it has get it online. So if you want to actually support your local small business, you can still do it. If you want to go in person it’s there. And I think that that could actually help them stay open into the future.

Jeff (30m 44s):
What’s next for you all?

Matthew (30m 46s):
Well, right now we are focused on building out the city scale service in Houston. Houston, as you, as you know is a very large place.

Jeff (30m 54s):
It is very large. (Laughs)

Matthew (30m 55s):
We are still a few, a few miles away from Humble, Texas. And so expanding beyond the area into two more areas of Houston is our current priority. Once we can get to city scale we’ll want to start bring this to new communities as well.

Jeff (31m 9s):
I’m just wondering, you know, in terms of like regulations in terms of adoption, in terms of what cities are, are willing to accept, I’m curious like once you finish up your testing and stuff, do you think it’ll be a quick adoption or do you think it’ll be something that’s a little bit longer? I mean, in the report, you know that the middle scenario was just kind of a gradual uptake of services like yours. I’m curious, like if you personally feel like it’s going to go faster or slower?

Matthew (31m 34s):
I think that once people try a service like this, they tend to love it. You know, not everyone, but our, our customer satisfaction is higher than Trader Joe’s, which is the most popular grocer. So it’s really, I think a popular service once people get to use it because it’s convenient. You get to stay at home and you don’t have to drive to the store, it’s a lower cost than existing delivery services. And it’s a consistent experience. There was a study that found that a quarter of people that have gotten food delivery, like hot food delivery have had a bite take one out of it at one point. And I think that that is

Jeff (32m 9s):
I’ve never had that. I’m glad I never had that. (Laughs)

Matthew (32m 12s):
Well, congratulations on being spared that. But I just think that it’s a consistent experience is what I mean to say. And so, you know that it will be more on time. They’ll be in a particular place you can set where it is once and then it always show up there so I think it’ll actually grow pretty quickly, but there would probably be a gradual introduction because the technology isn’t gonna be able to go everywhere all at once. It’s not going to be like the two biggest revolutions in our cities of TNCs and scooters where you suddenly had a thousand overnight. I think it will be more gradual than that because the technology will be able to expand where it can operate over time. So, you know, right now we’re operating in Houston, we’re limited by the regulations on speed.

Matthew (32m 52s):
We are not driving in snow yet. So we’re not going to be just showing up unannounced in a new city and saying, Hey, we’re here. Right? We’re going to first do the mapping to make sure that we have our maps for that, that area. Then we are going to be doing testing to confirm that the software is able to navigate it and safely, and then we’ll do a deployment. And I also think that we’ve had a lot of learnings from the prior two generations, that community engagement before you deploy is really important. So we’ve made sure that we’ve done that in every area that we’ve deployed and give people, both city officials but also law enforcement and the general public that are gonna be interacting with these vehicles, the chance to interact with them in a static place where they’re just parked, they can touch the keypad, see the doors open, understand how it works, learn about the technology before it comes everywhere.

Jeff (33m 40s):
What’s been the response from your grocery partners.

Matthew (33m 43s):
When can we launch in more stores? (Laughs) You know, I think that we’ve been really privileged to work with some great partners. You know, Kroger is our nation’s largest grocer. They are really having a digital reinvention strategy that this is one part of. So we’re learning a lot from them. And we’re excited about continuing to grow with our partners. We’ve also launched with CVS pharmacy. They are looking to keep learning saying, well, what if we changed this? What was the impact of, how do we make sure the technology works to keep the medicine secure? And really working out those questions now so that we can go to more stores.

Jeff (34m 16s):
Awesome. Well, Matthew, thank you for joining us, we really appreciate it.

Matthew (34m 23s):
Thanks, Jeff. It was really great to be here. Appreciate you having me on, and I’m looking forward to continuing to listen to the show for 14 more years.

Jeff (34m 31s):
And thanks for joining us. The Talking Headways podcast is a project of the Overhead Wire, on the web at theoverheadwire.com. Sign up for a free trial of the Overhead Wire Daily, our fourteen-year-old daily cities newslist, by clicking the link at the top right of theoverheadwire.com, and please please please support the pod by going to patreon.com/theoverheadwire. Many thanks to our current patrons for their ongoing support. And as always, you can subscribe to this podcast on iTunes, Stitcher, Soundcloud, Overcast, Spotify, and wherever you get your podcasts. And you can always find its original home at USA.streetsblog.org. See you next time at Talking Headways.

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