Waymo, the self-driving vehicle subsidiary of Alphabet, recently hit a significant milestone by providing 50,000 paid autonomous ride-hailing trips per week across three cities, with the company's growth appearing to be advantageous for rideshare giant, Uber.
The achievement by the autonomous vehicle company is an indication of the growing acceptance, and scalability, for its use.
Waymo and Uber's partnership—first launched in Phoenix in May 2023—has now expanded to Austin and Atlanta, where autonomous rides will be available exclusively through the Uber app starting in early 2025.
This partnership allows Uber to manage the fleet of Waymo's electric Jaguar I-PACE vehicles, while Waymo continues to handle the operation and testing of its self-driving technology.
The service is set to scale rapidly across new cities.
The latest development in the Waymo-Uber relationship—announced in December—reveals that Waymo will use a different fleet provider in certain markets, including Miami, which has been described as the "cheapest rideshare market."
While some investors had hoped that Uber would become a fleet operator for Waymo, it now appears that the two companies will continue to operate separately within the Uber platform.
Many are saying Waymo’s growth appears to be a strategic advantage for Uber, benefiting both companies as they push forward with their respective goals in the rapidly developing autonomous ride-hailing market.
Uber CEO Dara Khosrowshahi views Waymo's success as an opportunity for collaboration and mutual growth.
In a conversation on the Hard Fork podcast, Khosrowshahi pointed out that while Tesla’s vision for robotaxis is compelling, he believes Waymo’s model—integrating both software and hardware—will likely be the leader in autonomous driving over the next five years.
"I think Elon [Musk] eventually will get to viable scale, but for the next 5 years, I bet on Waymo," Khosrowshahi said.
Khosrowshahi favors Waymo’s approach, which includes a more robust hardware component like lidar and sensors, and presents a more immediate solution, noting Tesla’s focus on software may take longer.
For Uber, this means that Waymo’s progress can act as a catalyst, helping the ride-hailing giant stay competitive while avoiding the need to develop its own autonomous fleet from scratch.
Despite recent market fluctuations, including a 10% drop in Uber's stock following news of Waymo's expansion, analysts highlight that the long-term prospects of the Waymo-Uber partnership remain promising.
While Uber's stock may experience short-term volatility due to shifts in market sentiment around autonomous vehicles, the strategic collaboration between the two companies is seen as a significant opportunity for future growth.
A recent post on X from the account ConsumerTechBets sheds light on the significance of this partnership.
“In Sept., Waymo partnered with Uber for fleet ops in Austin & Atlanta. Available to be called in Uber. Suggests a win-win for the two,” ConsumerTechBets said on X.
ConsumerTechBets emphasized that the collaboration could accelerate both companies' timelines for scaling autonomous vehicle services.
“Investors were hoping that Uber (and perhaps Lyft) could be fleet operators, with Waymo abandoning first-party apps. But seems like that's not the case. In fact, the opposite, with timelines accelerating,” ConsumerTechBets said in its post on X.