Chinese driverless delivery startup Whale Dynamic targets US market with $2.5m funding
A nascent Nuro challenger from China is targeting the US delivery market and has just raised seed money to further its ambitions.
Dynamic Whale, a Shenzhen-based self-driving delivery startup founded by Baidu veteran David Chang, said it closed a funding round of around $2.5 million. Qianchuang Capital, a Beijing-based investment firm managed by veterans of major Chinese financial institutions, led the round, with participation from Shangbang Huizhong, a Chinese fund backed by property developers.
Founded in 2018, Whale Dynamic develops driverless Nuro-like delivery vans, designed to do away with the steering wheel and driver’s seat. And like Nuro, whose delivery robots are made by BYDit uses a Chinese manufacturer to produce its autonomous vehicles, the name of which cannot yet be revealed because the agreement has not been finalized.
Whale Dynamic’s slight advantage over Nuro is cost, surmises Chang, who worked as a product manager in Baidu’s Smart Driving Group. Nuro assembles parts in the United States while complete production of Whale Dynamic’s vehicles, from manufacturing to assembly, takes place in China, giving it a price advantage over its American counterpart. His vehicles cost around $20,000 each.
The latest financial injection will allow Whale Dynamic to expand its current team of 30 employees and explore product use cases in China and the United States. Led by engineering director Qi Wei, a native of Huawei, the company aims to have its first prototype car tested in select Chinese cities in May.
In China, Whale Dynamic faces competition from retail technology giants like Meituan and JD.com, which started testing last year their own goods delivery vehicles only. Chang believes his company’s technology, which takes the slower and more expensive route of R&D and testing on passenger cars rather than directly building the boxes on wheels, can better stand the test of time.
Whale Dynamic’s test fleet using passenger cars
Chang eventually wants to base his business in the United States and target express delivery services and supermarkets there. “You can test things much faster for less in China,” Chang explains why he started in China.
As Chinese and U.S. regulators step up scrutiny of tech companies for potential national security risks, companies that straddle the two countries will have to heed tougher regulations or choose sides. TuSimple, a California-based self-driving trucking company backed by a subsidiary of Chinese social media giant Sinais looking to sell its unit in China, Reuters reported.
Most of TuSimple’s vehicles operate in the United States with a smaller fleet operating in China. But US regulators expressed concerns about the company’s Chinese background and access to data from its China office, which allegedly led to TuSimple’s decision to offload its Chinese unit.
Safety compliance is a priority at Whale Dynamic, says Chang. When entering the US market, the startup will opt for US cloud services like AWS and Google Cloud; its Chinese team will handle hardware development only. The company’s main suppliers are also American – Oster for lidar (and Israel-based Innoviz, which has offices in the US), and Nvidia and Intel for chips. Unlike Nuro, which operates its own fleets, Whale Dynamic plans to only offer off-the-shelf vehicles and software as a service, leaving the operational part to its customers, which should limit the amount of sensitive data that the startup can glean. .