Chinese startup Inceptio is projecting a significant surge in the adoption of its driver-assist technology among trucks in China, with the number of equipped vehicles expected to quadruple by mid-2024 from the current count of approximately 600. The company is also gearing up to expand its operations internationally, targeting overseas sales commencing next year.
Inceptio's advanced technology facilitates the completion of long-haul trucking journeys by a single driver, eliminating the need for a customary two-driver arrangement. This innovation has the potential to curtail hauling expenses by an estimated 5% to 7%, bolstering operational efficiency.
Operating under its prevailing business model, Inceptio focuses on the development of the technology, while state-owned Dongfeng Automobile Co. assumes the role of manufacturing the trucks. Subsequently, these trucks are marketed to a clientele that includes prominent names like Nestle, Budweiser, and prominent Chinese freight enterprises such as ZT Freight and Deppon Express.
Julian Ma, Chief Executive of Inceptio, highlighted the mounting cost pressures faced by these companies, predicting that this factor would drive an escalating demand for their driver-assist technology. During an interview with Reuters and at a media event, Ma termed this scenario as a “new ‘blue ocean' market,” referring to an untapped sector with limited competitors. Inceptio's contenders encompass China-based Plus.ai and TuSimple (TSP.O), a Chinese-founded company headquartered in the United States.
Ma noted, “China is leading globally in terms of building the industry with suppliers of chips, sensors, the automakers and developers of autonomous trucking technologies.”
Since 2020, Inceptio has secured more than $678 million in funding from investors including CATL and Hongshan, previously recognized as Sequoia China.
Over the forthcoming three to five years, Inceptio envisions the provision of services designed to assist in the management of truck fleets, according to statements made by Julian Ma.
While the trucking market in China boasts substantial dimensions, amounting to approximately 4 trillion yuan ($550 billion) on an annual basis, intense competition has led to slender profit margins. As a result, Inceptio is primed to venture into foreign markets, testing waters in regions like South East Asia, the Middle East, and Japan, with plans for the initiative set to commence next year. Ma clarified that the U.S. market remained inaccessible due to geopolitical considerations.
China's trucking industry is notably fragmented, with Boston Consulting's 2021 estimate revealing the presence of around 7.3 million heavy trucks traversing the nation's roads.
Inceptio holds aspirations for a future where trucks can operate autonomously, culminating in the establishment of a robotruck fleet. The company anticipates that China could witness the emergence of two to three firms specializing in robotruck technology over the next three to five years, contingent upon regulatory developments aligning with this trajectory.