FMG’s Robot Trucks Have a Fender Bender

Iron ore miner Fortescue Metals (ASX:FMG,OTCQX:FSUGY) has confirmed to local media in Australia that two of its autonomous trucks operating at the Christmas Creek mine in the Pilbara collided after the local WiFi network dropped out.

The company said that nobody was injured or even involved with the collision, which occurred when an autonomous truck backed into a parked autonomous truck.

CEO of Fortescue, Elizabeth Gaines, said that the incident was “not the result of any failure of the autonomous system,” which the company has been rolling out across its operations since 2012.

“Since the introduction of the first AHS (autonomous haulage system) truck at Solomon in 2012, AHS trucks have safely travelled over 24.7 million kilometres.

“Safety is Fortescue’s highest priority and our autonomous haulage system has improved the safety and productivity of our operations.”

The company did not elaborate on why the collision occurred, but said an investigation was underway.

Fortescue has been in the process of converting trucks at Christmas Creek to AHS since early 2018, when it announced plans to convert approximately 100 trucks.

Later in 2018, it awarded a contract to convert at least 65 trucks to ancillary mine services provider Theiss, which is owned by the CIMIC group (ASX:CIM).

On Wednesday (February 20) Australian-time, Fortescue released its half-year results to 31 December 2018, reporting (amongst everything else) that works on its Eliwana iron ore mine replacement project were proceeding on schedule and on budget.

Fortescue also said that in the six months between July 1 and December 31 2018, it shipped 82.7 million wet metric tonnes of iron ore at a C1 cash cost of US$13.11 per wet metric tonne, and in December it commenced shipments of its West Pilbara fines product, which is catered towards Chinese buyers.

Looking at financial numbers, the company posted a net profit after tax of US$644 million, underlying earnings before interest, tax, depreciation and amortization of US$1.6 billion and a net debt of US$3 billion, which is inclusive of US$962 million cash on hand as of December 31.

On the Australian Securities Exchange, Fortescue closed down slightly 0.31 percent on Tuesday (February 19) at AU$6.35, though markets were yet to react to the half-year results which came out on Wednesday morning.

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Securities Disclosure: I, Scott Tibballs, hold no direct investment interest in any company mentioned in this article.