Exit Sidewalk Labs, enter COVID-19: what impact on autonomous vehicles in Canada?
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May 21, 2020
Luke Sarabia

Economic instability and social distancing requirements have put self-driving pilots on pause, with some programs canceled or scaled back. But AV proponents say the outlook remains strong

Image: Sidewalk Toronto

Economic instability and social distancing requirements have put self-driving pilots on pause, with some programs canceled or scaled back. But AV proponents say the outlook remains strong

A vision of self-driving vehicle fleets coursing through new streets on the downtown Toronto waterfront in the not-too-distant future took a big hit earlier this month, when Google-affiliated Sidewalk Labs abruptly canceled its high-profile Quayside project.

The ambitious and controversial plan, initially announced in 2017, was set to transform an underused portion of the city’s eastern waterfront into a high-tech “smart city” in which self-driving vehicles would play a prominent role.

Instead, according to Sidewalk Labs’ CEO Dan Doctoroff, “unprecedented economic uncertainty” made it “too difficult to make the 12-acre project financially viable without sacrificing core parts of the plan we had developed.”

Pandemic disruption

Many factors led to the decision, but the unprecedented disruption posed by COVID-19 was the catalyst. Just as the pandemic has disrupted plans and shuttered all manner of businesses in Canada and beyond, the world of autonomous vehicles has been no exception.

Cruise, the self-driving unit of General Motors, recently announced it would layoff 160 employees, representing about 8 per cent of its total staff; its current road tests have largely been put on hold. Ford has said that it will push back the launch of its own autonomous vehicle service to 2022.

Uber also recently announced it would lay off 3,000 employees due to COVID-19, including some from its Advanced Technologies Group, which runs the company’s self-driving program.

Still, if you expect AV proponents to be dejected, you’d be mistaken. According to several experts contacted by Electric Autonomy Canada, there remains much reason for optimism on the long-term outlook for deployment of self-driving vehicles.

Potential to innovate remains

“The momentum that Sidewalk Labs ignited can continue to be a driving force for Toronto’s future and that is very exciting for our community,” says Jan De Silva, president and CEO of the Toronto Region Board of Trade, which earlier this year published a report arguing that deployment of AVs will be a key aspect of managing Toronto’s future growth.

“Though this is not the outcome we desired, we remain optimistic about Toronto’s strong leadership in the tech sector and look forward to future opportunities to collaborate with new, innovative projects going forward.”

Raed Kadri, the senior director of automotive technology and mobility innovation at OCE and head of Ontario’s Autonomous Vehicle Innovation Network (AVIN), is equally upbeat. Despite the current setbacks, he says Ontario remains well-positioned to become a leader in autonomous transport following the COVID shutdowns.

“We’re a traditional automotive jurisdiction that continues to thrive and grow in the auto sector and we’re also a jurisdiction where we have a massive IT sector and a very strong entrepreneurial startup ecosystem. All of those are the right ingredients to continue to push forward in this space,” says Kadri.

“In terms of future mobility and technology, Ontario continues to be a place where technology thrives and grows.”

Autonomous investments still strong

It’s not just brave talk. While shutdowns dominate the news cycle, a number of driverless delivery enterprises have recently seen increased attention and investment — perhaps due, in part, to the urgent reduction of human contact required to fight COVID-19.

According to an analysis by Reuters, the past seven months have seen a total of over $7 billion in investments made towards companies involved in autonomous delivery of goods and food.

One such enterprise to see massive growth this year has been Waymo, the autonomous driving technology company established by Google and fully owned by its parent, Alphabet Inc.

In early March, we reported on Waymo’s announcement of a $2.25-billion injection from its first group of external investors, which included the Canada Pension Plan Investment Board and Magna International Inc., Canada’s largest auto parts manufacturer. Now, just last week, Waymo announced that it has received $750 million in additional funding since, bringing that total up to $3 billion.

According to Waymo, the investment will be used towards developing Waymo One, the country’s driverless ride hailing service, as well as Waymo Via, its driverless delivery operation.

A new future

This recent influx of AV investments supports the view that despite the current state of the world, the long-term trajectory of planning and economics in which autonomous vehicles can succeed remains.

Even without Sidewalk Labs working to bring AVs to Toronto, the strength of Ontario’s future mobility cluster means the region is well-equipped for a similar project to follow in its wake.

“These technologies are made to support safer, more efficient and more productive movement of people and goods,” says Kadri.

“Right now, the focus is on COVID and getting past COVID safely, and then we go back to maintaining our leadership position in the space.”

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