We spend a lot of time here at Decoder discussing electric vehicles and the future of cars, and we usually talk about passenger vehicles or perhaps cargo vans. But there’s another huge industry that could also benefit from electrified transportation: agriculture.
This week I was one of the presenters at the Code Conference where I had the opportunity to chat on stage with Monarch Tractor CEO Pravin Penmetsa. Honestly, this was one of my favorite talks of the entire event.
We are totally dependent on agriculture as a species and agriculture is totally dependent on tractors. If we don’t have tractors, we don’t have food. But electrifying farms is difficult, and Praveen explained how he and Monarch are trying to tackle the problem.
Praveen and I managed to cover a lot of ground in a relatively short amount of time on stage. Farming is a very old business and it is difficult to make big changes. You will hear Praveen say that the average farmer only gets 40 attempts to repeat his process — 40 growing seasons. And Praveen sees a lot of opportunity for farms to transition to electric autonomous equipment without disrupting those 40 cycles of agriculture. And of course, there are many opportunities for his business to benefit from this transition.
He told us that the monarch has three ways of making money. There is, of course, tractor equipment; selling real cars. There is a subscription fee, and Monarch charges an ongoing fee for its software platforms, i.e. Smart Tractors as a Service. Then there’s the licensing — Monarch has an agreement with Case New Holland to use its platforms. The ambition is to compete openly with closed platforms like John Deere, and Praveen said his goal for the Monarch platform is to become the Android of agriculture.
Ok, this is Praveen Penmetsa, CEO of Monarch Tractor. Here we are.
So our mission at Monarch Tractor is how we make agriculture sustainable and farmers profitable. It may come as a surprise to most of us that less than half of the country’s farmers actually make money, less than 42 percent. Most of our agriculture is not sustainable, not only in terms of chemicals, but also in terms of how we use our resources, from water to fertilizers.
We decided to build a small tractor for farmers who grow fruits and vegetables. It is where most of our food comes from. And it is electric, autonomous and smart. And that it allows farmers, for the first time in history, to have a tractor that creates new sources of income for them using all the data it collects while working on the farm. So it’s a familiar form factor.
So when I look at this tractor, I say, OK, we can sell it to a lot of people, we still have the steering wheel. It has a battery.” But the thing is decorated with sensors, go look outside. It is covered in cameras and sensors. It has machine learning built into it. You are on your way to autonomy. You have a software platform that can control multiple tractors simultaneously.
There’s a long way between fruit and vegetable farmers and those with things from the 1980s autonomously driving a connected platform. How are you now? A little more than a year has passed. Where are we during the trip?
So in December we put our tractor into commercial production. Now we are the only electric self-driving car that one of you can go and buy. I am very proud of this fact.
You can do whatever you want on the farm. It’s a problem on the road.
exactly. The fact that we’re on a commercial scale…the fact that we have Foxconn—the manufacturer of our electronics, building the smart electric machine for the agriculture of tomorrow, in Ohio today—is a big deal. So, we have more than 200 such machines working on our farms.
These are customers, not test units. Did you sell 200 of them?
They are customers. Last month we delivered over 75 tractors to customers, trained them and left. So now they use electric autonomous cars.
And do you collect data about these tractors when customers use them?
This is the great part, because the tractor is at the heart of every farm, we can see every operation from the first day, when farming starts, until the post-harvest period, when everything stops. So with the help of our cameras, we get data not only about what is happening on the farm, but also about who, what, where, when and how. Most importantly, how — how do they farm? All of this comes from our vision systems: 3D cameras as well as standard cameras. Then we use artificial intelligence and a lot of data scientists to put that data into some structured data lakes from which we can pull statistics and reports for the entire ecosystem.
So we effectively become the Android of agriculture and the whole ecosystem can access our data lake through our APIs and provide reports. We are very excited to share everything that comes off our tractor with everyone in the food ecosystem, not just farmers. It could be you and me. Today, we live in a world where you and I know more about the DoorDash person who delivered our food than the person who actually grew our food, and that’s what created this vicious cycle for us in our food ecosystem.
When you think about this approach, Android farming, it’s a fine line. Continuing the analogy, at a high level, the iPhone doesn’t seem like much of a threat to Android, does it? Are you playing “open always wins” here? Or are you saying that there will be a huge market and we will coexist with a more closed market?
No, there will be a huge market. Today, we only have 3 million tractors sold each year and we have over 2 billion acres of cropland. I’m not talking about pastures and such – arable land. For comparison, more than 70 million cars are sold every year. So it tells you the difference and also the possibilities for smart machines for agriculture.
In short, we’re going to need a lot more of these machines in the next 10 years if you’re going to stop using chemicals and do more farm operations. So, those 3 million will grow. It has been growing for the past five to six years. This market is about to explode. There will be new entrants to this market. We see it. We see people from the food ecosystem coming in, not just the hardware ecosystem. We see fertilizer companies now building devices. So this whole market is going to explode, and our idea is to enable that to happen by giving them the technology to enable them to build smart electric autonomous machines for agriculture.