What happened to Refraction AI's adorable little shuttles?
by Jan Schlain
From the December, 2021 issue
They were here: ten shiny, bicycle-wheeled robots. Then suddenly, they were gone.
Refraction AI's delivery vehicles rolled onto Ann Arbor's streets two years ago amid a flurry of national news and social media attention. "The feedback is people are very excited," Refraction cofounder and U-M robotics prof Matthew Johnson-Roberson told the Observer in 2020. "They hear a lot about autonomous vehicles--there are a lot of news stories--but it's very rare to get the opportunity to actually interact with one."
The three-wheeled, battery-powered shuttles weren't entirely autonomous--they were always monitored remotely and escorted by "safety operators" on bicycles or electric scooters--but seeing one on the street was a joy, in a weird kind of way. The company said that because they cost just $4,000 apiece, they could make deliveries for half the cost of car-based services like Grubhub or DoorDash. Johnson-Roberson said they were asking themselves "what process, and what type of vehicle assembly, works for 1,000 vehicles?"
Miss Kim owner Ji Hye Kim started using the service because one of her customers, mechanical engineering prof Ram Vasudevan, was Refraction's cofounder. "They emailed me, then we met over coffee, and I thought it was a really interesting, fun idea," she recalls. "And we gave it a try."
The service "was great," Kim says. So she was disappointed when it was canceled without warning in October.
"It wasn't like 'Hey, we might not be giving you service after this particular day because of x, y and z,'" says Jenny Hall, marketing and communications manager at Zingerman's. "It was like, everything was moving forward as normal, and then all of a sudden, we just [got] notice" that the robots were leaving town.
"It's a bummer for us," says Kim, "because we don't have a good idea how to fill that need again without the robot delivery. A lot of small businesses cannot afford the kind of car insurance that you need to have in order to do in-house delivery. We have to
rely on third parties, and we are at the mercy of the third-party agreements. We don't know how to fill this gap.
"But," she adds, "it's a very small gap."
"From our perspective there just wasn't a whole lot of story" in the shuttle's departure, says Hugh O'Donnell, Refraction's Portland-based director of business development and strategy. O'Donnell says that while the company's five R&D vehicles will remain in Ann Arbor, the entire delivery fleet of ten is now in Austin.
"We did several thousand deliveries" in Ann Arbor, O'Donnell says. They "had a lot of fun working with the restaurant community," he says, but "ultimately there's a lot of benefit to having all of your robots in one place."
The company sent its first batch to Texas this past summer--CEO Luke Schneider, who was hired last fall, is based there. At the time, it was described as an expansion. But by then, Johnson-Roberson's ties to Ann Arbor may already have been fraying. In November, Carnegie Mellon University announced that he'd agreed to lead its renowned robotics institute.
"Austin is the eleventh biggest city in the U.S. and has a lot of characteristics that are really comparable to average American cities," O'Donnell says of the decision to concentrate there. "It offers a level of operational diversity that allows us to demonstrate the flexibility of what we're able to do and just how broadly applicable our technology is in the real world."
But even in midsized Ann Arbor, the bots' visibility exceeded their impact. Three restaurants the Observer spoke to said they made minimal use of the service.
It "was really inefficient," says a manager at Tios. "We would call for one of them to come at a certain time, and it would take longer; and we would have the food cooked, and on top of that, it would be in the robot for longer than a driver would take because they move quite a bit slower than a driver in a car. So really, it was a food quality issue."
The problems weren't unique to Refraction. "We used to use DoorDash and Grubhub," the manager says, "and we don't anymore because of that inconsistency. "We just do all of our deliveries ourselves."
"It was easy for us to learn about them because they were doing all their trial runs in the building upstairs from us," emails Dennis Webster of the Earle. "We did utilize the delivery bots, but only very seldom." His customers just didn't seem interested in delivery, and the Earle no longer offers it.
"We were excited about their potential to solve our delivery issues but ultimately had to stop using them because of their internal issues and restrictions," says BTB Buritto's Adam Lowenstein. "They only went to 8 p.m., they had a three-mile delivery radius, and more often than not, they didn't have enough bots available for their demand. We dropped them before they closed shop."
O'Donnell suggests that if other restaurants didn't use the service much, it's because one client was all-consuming: "As you can imagine, for just about anyone doing delivery in Ann Arbor, Zingerman's [Deli] ate up almost all of our deliveries," he says.
Like Kim, Zingerman's Hall liked the service. "They would mostly be on time," she says. "They'd show up when expected. We didn't have too many delays. So that was fabulous ... it was a great option for a lot of near-location deliveries. My guess is if it were a campus area or downtown [destination], it probably went faster than a driver."
But "what I heard more often was that the assessment of it changed over time," Hall continues. "When it was very new, it was very novel. Toward the later end of it, people started questioning why there was both a robot and a person; it seemed inefficient at that point. But they hadn't developed the technology enough to eliminate the person ... so that was an ongoing question--'Well, if there's a person there, why do you need the robot and the person to make the delivery?'"
No company has yet deployed a fully autonomous vehicle. Tesla has heavily promoted a feature it calls "full self driving," but now describes it as merely assisting the driver. The National Highway Traffic Safety Administration is investigating multiple incidents where its cars have crashed into parked emergency vehicles while on "autopilot."
Tesla, with its trillion-dollar market valuation, can afford to continue developing the technology. Refraction's situation is more precarious.
Zingerman's Deli used the bots for "a handful up to fifteen to twenty deliveries a day," says Hall--and by O'Donnell's account, that was most of the company's business.
Though they got no advance notice of the shutdown, Hall says, they did get an explanation. During a phone interview, she pulls up an email from her manager and reads it aloud:
"'Refraction AI abruptly closed their Ann Arbor delivery operations today. Effective immediately--because they're going to miss the next funding round and decided to consolidate in Austin.'
"They did what they needed to do for their business," says Hall.
Asked if the company lost an expected investment, O'Donnell doesn't answer directly, but texts, "We're in good shape from a capital standpoint."
"If we have it our way, in every other city in the U.S. there will be robots," he said earlier. "So we will be doing deliveries in Ann Arbor again. It's just a matter of getting more robots rolled off the line to make that happen ..."
Despite the challenges, O'Donnell's faith in the little bots is undimmed. "I like to say for everything that can wait, there's Amazon," he says. "And for everything else, there's us."
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