Uber wants Elon

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Uber CEO says competing with Elon Musk is 'no easy matter' — and would love to partner with Tesla on robotaxis (link). Not a shocker here, Uber has been all about the AV partnerships as I highlighted last week, but Tesla might be the only AV company that doesn’t need Uber.

All Elon needs to do is send out one tweet and you’ve got a customer base for a ‘Tesla’ rideshare platform. On the supply side, Tesla has millions of cars already on the road that could potentially ‘self-drive’ with a software update. And I would wager that many Tesla owners would gladly put their vehicles on a Tesla rideshare network to make some extra money when their car is idle (ie most of the time). Similar to Uber, this variable supply means that they can scale their ‘robotaxi’ fleet up or down to meet peak demand (a former Uber ops employee told me that New Year’s Eve is 50-100x typical demand) without having to pay for downtime. Waymo can’t do this since they own and operate their own fleet (for now).

The big caveat here of course is that Tesla’s ‘Full Self Driving’ (FSD) product isn’t full self driving yet (great marketing though). So if/when they get to the level of today’s Waymo, Uber could be in trouble..

The 'godfather' of driverless cars says Tesla has a major advantage in the self-driving race (link, no paywall). Levandowski is the engineer who co-founded Google's self-driving program in 2009 and left for Uber in 2016. Google ended up suing him, claiming Levandowski had stolen intellectual property that would benefit Uber. Levandowski was subsequently fired by Uber and later sentenced to 18 months in prison—before being saved by a presidential pardon from former president Donald Trump. So he might be a bit biased here..

But I do think he has a point. If you’re going for the home run, I think Tesla’s approach has the bigger potential outcome. Waymo is taking the hardware route and needs to focus on getting the cost structure down to a point where it’s profitable on a unit economic basis. Tesla is taking a software approach: their cars are already on the road, profitable, and if/when they can figure out FSD, they will be able to pose a real threat to not only Waymo, but also Uber.

Apple terminates its self-driving vehicle testing permit in California (link). The termination marks a significant shift in Apple’s strategy, effectively closing the chapter on its autonomous vehicle ambitions. This came after they poured over $1B in their AV project. Luckily, they can afford it.

Funding

European Investment Bank (EIB) invests €34M in Berlin-based Vay to expand teledriving car-sharing services (link). Teledriving may be a key component of driverless rideshare in the future.

First Ride

AVs behaving badly

Waymo blocks traffic during an emergency situation (link). Not sure why I found this clip so funny but I feel like this should be easy for one of Waymo’s remote operators to quickly hop in and move the vehicle where it needs to go.

Waymo is scaling crashes, but considering they do a self-reported 100,000 rides per week, the numbers don’t look to bad to me. 70 crashes per month / 400,000 rides per month = 0.0175% crash rate. And we know that in a lot of these crashes, Waymo Driver is not at fault.

On a more binary analysis, there have been no reported deaths. I think this is one of the real reasons why they avoid freeway driving. Personally, I’ve felt safe riding in Waymos, especially compared to my Tesla FSD.

Other Stuff

All of the Waymo cars in Los Angeles are busy right now. Uber’s number one KPI is reliability, when you open the Uber app they want you to see a car available and a 3-5 minute ETA. I’ve never seen this message (All of our cars are busy with riders right now) on Waymo before but I think it highlights how hard it is to balance supply and demand. It’s not a good experience for customers to open the app, call for a ride, and not be able to go where you want to go (Waymo is geo-fenced, can’t go on freeways and doesn’t always have cars available). Just another reason why Waymo needs Uber.

Waymo is giving San Francisco residents a $3 credit for Waymo rides taken to or from select transit stations from October 17 - November 15, 2024 (link). This tweet gave me deja vu. Uber and Lyft went through a similar ‘courting public transportation riders and officials’ phase back in the day. It sounds great in theory, but in reality, the first/last mile logistics are tough and the customer demographics are opposite. If anything, the data is clear that rideshare takes riders away from transit.

Waymo climbs to #17 in the App store. As Brian notes, this is impressive for an app that’s only available in two cities and behind a waitlist in two other cities. One thing Waymo has shown is that it’s not hard to get tens of thousands of customers to download a new rideshare app if you have an innovative product. Tesla should have no problem with this too when they launch robotaxis ‘next year’.

Autonomous driving is incredibly challenging, both technically and commercially, with social acceptance and regulations adding to the complexity. In the heels of Tesla's "robotaxi" reveal, it’s a good moment to reflect on the importance of skepticism in tech. Who's your favorite AI hype buster? (link)