Can Amazon, Tesla and Uber Compete?

It’s real: Alphabet subsidiary Waymo recently announced a multi-year, $5 billion investment during its second-quarter earnings call, and self-driving ride-hailing services are becoming more common in U.S. cities.

At all hours of the day and night, Waymos can be seen driving past each other on the streets of San Francisco, with multiple Waymos circling popular tourist attractions like Coit Tower.

The company, which was born in 2009 as the Google Self-Driving Car Project, plans to start offering fully self-driving rides in the city in late 2022, and began offering paid services in August last year. But it faces tough competition from Cruise, a plucky rival with startup grit and a fleet of 600 vehicles, including 400 in San Francisco, and cars with endearing names like “Popsicle” and “Goldie.” Last October, Cruise had its permit revoked after a series of accidents, including one in which it dragged a pedestrian under its wheels. Suddenly, San Francisco was a Waymo town, and a frenzy ensued as the waiting list soared to 300,000 before it opened to the public in June.

By the numbers

Waymo says its fleet of about 700 vehicles currently spans three markets — San Francisco, Phoenix and Los Angeles — and takes more than 100,000 paid rides every week, with 2 million paid rides to date.

San Francisco is its largest market with 300 vehicles. It has not yet been approved for public transportation to highways or airports, but its service area recently expanded to nearby areas in San Mateo and is testing on Interstate 280. In Phoenix, its second-largest market, Waymo has been offering shuttle service to the airport since 2022.

The company recently launched in Los Angeles to select passengers with a waiting list of 150,000, and will launch in Austin next. In total, the company is testing in 25 U.S. cities, including Atlanta, Dallas, Detroit, Houston, Las Vegas, Miami, New York, Seattle, and extreme weather areas like Buffalo.

Waymo’s initial plan was to add 20,000 Jaguar I-Paces to expand to 1 million daily trips, but it has pivoted to a more cost-effective robot bus platform, partnering with Chinese electric car maker Geely to build purpose-built five-seater vehicles for the GeeCar brand.

Jack Wunderman, Waymo’s product lead for driving behavior and inference, explained the excitement for the new form factor: “Z-Car is a platform purpose-built for ride-hailing, with a lot of interior space and large sliding doors,” and the seats remain forward-facing for comfort, Megan Nease, Waymo’s head of product and customer research, told me. “Being able to know where the car is going, that the car sees what you see, and having the confidence to let your hands off and relax is really important,” she said.

Competitive Environment

Waymo is leading the way in the US, with rivals gearing up to put their vehicles on the roads.

Zoox on Amazon The company plans to launch public rides in Las Vegas later this year, and is conducting tests in San Francisco, Seattle, and Las Vegas. Chris Stoffel, Zoox’s director of industrial and creative design, told me at CES that the company aims to be the first in the US to offer paid self-driving rides in purpose-built vehicles without steering wheels. The Zoox experience is expected to differ from Waymo’s Zeekr in that it’s designed for bidirectional travel, with up to four people able to sit facing each other in the same quadrant, party-style.

cruise It is expected to return with a self-driving Chevrolet Bolt in 2025. Uber The company, backed by GM, Honda, Microsoft, Walmart and T. Rowe Price, has been testing the platform in Phoenix, Houston, Dallas and Dubai, with previous markets including Austin, Miami and San Francisco.

Uber The company is adding self-driving options to its platform, including its Waymo ride-hailing service in Phoenix, and food delivery services Saab Robotics in Los Angeles and Kartken in Miami, Fairfax and Tokyo. The company is also working with Chinese electric vehicle maker BYD to bring self-driving cars to markets outside the U.S. Other services that could be candidates for Uber’s platform include: Mobileye We have been working on Volkswagen The company plans to have ID. Buzz AD ready for autonomous ride-hailing services in Austin and Hamburg by 2026.

and Tesla The company is focusing on developing its FSD autonomous driving system and plans to unveil its cyber taxi service at Robo Taxi Day on October 10th.

But Waymo’s biggest threat may come from China, where several major robotaxi operators have been granted licenses to operate in California. Auto X This includes 1,000 robot taxis and WeRide The company, which has a fleet of 600 aircraft, has postponed its $5 billion IPO on the Nasdaq. BaiduThe company has deployed 500 robot taxis in Wuhan but has not yet applied for a permit in California. Nio, Diddy and Pony.ai.

Still, none of these are absolute victories. MotionalIn a recent blog post announcing layoffs and a pause on its robotaxi deployment in Las Vegas that had already seen 100,000 rides with Uber and Lyft, CEO Carl Iagne said “large-scale driverless deployment won’t happen overnight,” explaining that the business case has yet to be made. The company recently closed a nearly $500 million funding round with Hyundai.

The costs of operating fully autonomous vehicles are likely to be prohibitive, so it will be interesting to see whether companies without investment from existing cloud providers will be able to compete.

About Fans

Meanwhile, Waymo has plenty to celebrate as enthusiasts reach riding milestones.

Jayden Sterling, who took 1,107 rides, is one of Waymo’s top power users, having adventured 7,105 miles and more than 34,912 minutes on the self-driving service. Sterling, who uses “they/them” pronouns, had just turned 18 and didn’t have a driver’s license when he arrived in San Francisco to work at the startup. It was October 2022, and fully self-driving rides were being offered for free to a select group. Sterling quickly became a trusted tester, and his adventures with Waymo led him to drive around the city, making multiple stops for Blue Bottle Coffee and pizza, and then flying to Phoenix to see an art exhibit and to Los Angeles for dancing and sightseeing.

“It’s a very freeing feeling to be able to go wherever you want,” Sterling said, explaining that Waymo’s “Add-A Stop” feature allows you to schedule a trip of up to five stops, and the car is zero-emission electric, so it’s a cleaner way to explore.

Vili Ilchev, managing director at venture capital firm Two Sigma, is also a big Waymo customer and believes the technology could save millions of lives.

“When I’m biking, I’m on my bike and I come next to a Waymo and I can see that it’s looking at me. If I try to pass on the right, it makes room for me. It’s very reassuring that Waymo is always looking at me. They never cut me off or get in my way. They always prioritize my safety,” he said. “My kids would rather ride in a Waymo than any other car.” Ilchev, who owns two EVs, a Rivian SUV and a Chevy Volt, feels that everything will be autonomous in a decade or two and hopes Waymo will accelerate the transformation by licensing it to other OEMs.

On safety, Wunderman explained that the car’s sensors can see hundreds of meters in all directions and can see things that humans tend to miss, like when it’s dark or when a head pops out from behind the car for a split second. The sensors know there’s a person there and slow down defensively. The fields of view are overlapping, so the car can see in both directions at the same time. And the AI ​​is starting to think like a human when it comes to locating lanes and driving at the right speed in fairly complex scenarios.

“Waymo is the most mature embodiment of AI in the physical world today,” Wunderman said. “We’ve been working with machine learning and AI since our founding, and we’ve been at the forefront of applying AI to the real world. And what’s really exciting is that our AI models are enabling a lot of emergent behaviors that we’ve always wanted and knew we wanted to have in our vehicles, but that would be difficult to achieve using just hand-coded heuristics or other traditional robotics approaches.”

The company is still fine-tuning the accuracy of its drop-off and pick-up locations, which can sometimes be several blocks away from the requested pin, but for many riders the experience is still magical.

That’s by design, says Nees: “We call it a privileged space where you have the freedom to drive while knowing that the car is sensing what’s around you. The on-board screen detects small road signs, the size of a bus, the difference between a bicycle and a scooter or motorcycle, and visualises that to the rider, so the driver always has the sense that we’re seeing things that they might notice while driving.”

It remains to be seen whether features like conversational AI will be added to allow passengers to chat with their Waymo driver and ask for the Giants score, request a massage or guided meditation in a heated reclining seat, or suggest shoppable shows where you can order actor costumes. Perhaps the driver’s seat will be removed and, on longer rides like from San Francisco to Los Angeles, the cabin will be dynamically configurable into whatever kind of active living space you need, from a game room to a yoga class or even a podcast studio.

But for now, it’s still early days and we’re just focused on optimizing the music experience, Neese said.

Of course, the possibility is always there: Waymo is a sister company to Google, after all.