Kodiak Robotics Takes Self-Driving Trucks Off the Road to Reach Profit Faster

Don Burnette, CEO and co-founder of autonomous truck company Kodiak Robotics, had a lightbulb moment when the company began working with the U.S. Department of Defense.

Kodiak’s mission has always been to pursue long-haul, autonomous trucking, but two years ago, the startup won a $50 million contract from the DoD to help the Army automate ground vehicles for high-risk missions. That deal gave Kodiak access to much-needed capital in a tight financing market; it also gave the startup a chance to test its autonomous driving stack in unstructured, off-road environments.

This experience allowed us to see an idea: off-highway driving could provide a faster route to market than driving trucks on highways.

Kodiak this week announced plans to launch fully autonomous trucking by the end of 2024 or early 2025 in partnership with Atlas Energy Solutions, a supplier of backfill material (also known as sand) and logistics services to oilfields.

Kodiak and Atlas have been testing autonomous transportation for several months. In May, the two companies completed Kodiak’s first driverless delivery run. A driverless semitrailer truck—just Kodiak’s autonomous hardware and software—delivered frac sand for Atlas in the remote Permian Basin of West Texas. The 21-mile stretch of land Kodiak drove on has no paved roads or structures—just “cacti and bushes,” Burnette said.

Off-road driving presents AV companies with a unique set of challenges. For example, the vehicle cannot rely on HD maps because they often do not exist; terrain conditions also change based on weather conditions.

Burnette said that in the Texas desert, “the sand is constantly shifting, and everything is changing from hour to hour.”

“So the vehicle has to understand what the road surface is that you can drive on? How do you get to your destination?” Burnette said. “That’s something that the technology in Kodiak has really refined over the last few years, and it’s been driven in particular by our partnership with the DoD.”

The founder noted that, at least for Atlas, using off-road vehicles today provides better product-market fit than long-distance trucking.

According to Burnette, Atlas is in the business of hauling sand 24/7, which means it’s more expensive to operate the trucks because it takes at least three driver shifts to transport them.

“So the value of autonomy in this particular area is actually higher per truck than the value of road transport,” Burnette said. “And then, given the structure of the environment, given the speeds, we’ve already been able to validate our driverless operations using the technology we’ve developed, which means we can effectively deploy it this year.”

Kodiak still plans to continue its long-haul trucking route in parallel with its partnership with Atlas and the DoD. But that path to generating revenue is much longer. To be sustainable and ultimately achieve that goal, Kodiak needs to get paid much sooner.

Kodiak’s deal with Atlas will initially cover two trucks, with more to be added in the future. The startup will operate a Driver-as-a-Service model, in which Atlas buys trucks directly from the OEM, and Kodiak equips them with its technology and provides ongoing support and monitoring services.

Kodiak isn’t the only autonomous-driving startup using DoD money to bring off-road vehicles to market. The Army earlier this year awarded Overland AI, another company developing an autonomous-driving system for military operations, up to $18.6 million to build a prototype autonomous software stack for its combat robotics program. Overland is among a group of startups and more mature companies carving out an off-road niche in the autonomous-vehicle sector.

“I think at this point,” Burnette said, “it’s the companies that find a path to profitability as quickly as possible that will ultimately win.”