Autonomous drive tech company TuSimple has announced that US freight rail giant, Union Pacific will be the first customer to use its automated truck service to haul cargo in Arizona.

Starting in the next two months during the Northern Spring, TuSimple trucks will pick up loads at a Union Pacific freight depot in Tucson and haul them to a distribution center in Phoenix. Though the deal is non-exclusive it is a significant new partnership for  TuSimple according to the company’s CFO Pat Dillon.

“This dovetails with the fact that driver out is not a one-time event. It’s something that’s repeatable and it’s scalable,” Dillon said.

“Having Union Pacific say that they want to be the first commercial customer to have their freight being hauled on a driverless truck is a nice validation,” he added.

Though TuSimple is still at least a year away from generating meaningful revenue, the company is moving quickly to shore up a leading position in the emerging market for robotic trucks, trying to stay ahead of competitors including Alphabet, Waymo, Aurora and Embark.

Unlike the robotaxi market that Waymo is also working on, TuSimple the has focused solely on commercialising autonomous technology for heavy-duty trucks operating on highways. That’s because the operating environment is somewhat simpler than crowded city streets, growing demand for trucking services and an ongoing shortage of long-haul truck drivers.

“We continue to believe that partnerships with established freight market participants are key to achieving successful commercialization,” Ravi Shanker, a Morgan Stanley equity analyst wrote in a research note.

“The TSP/UNP collaboration, the first of its kind between a rail and an autonomous trucking company, shows that the industry continues to ramp up their engagement with AV strategies as we approach commercialisation,” he said.

TuSimple said it completed its first driver out run last month and plans to continue doing more throughout 2022. So far, the company says it has completed about 600 miles of autonomous runs with no human backup driver on public roads in Arizona, without remote teleoperation assistance or traffic intervention.

“Partnering with TuSimple allows us to extend our operations beyond our rail hubs and serve our customers faster and more efficiently,” Kenny Rocker, a Union Pacific executive vice president, said in a statement. “This groundbreaking autonomous driving technology and our partnership provide us a significant opportunity to scale the technology in our network, proactively reducing global supply chain congestion.”

Loup Logistics, a Union Pacific subsidiary, will manage cargo transfers with TuSimple. It previously announced plans to work with shippers including DHL–and to supply it with automated trucks–UPS and Canadian National Railway. Truckmaker Navistar is supplying TuSimple with vehicles and Ryder System is to provide vehicle maintenance and other services.