I sometimes prefer to enjoy the benefits of vertical integration, like Apple being able to codevelop hardware and software unrestricted from having to provide a public API at every layer (e.g. airpods device switching), and being able to unilaterally dictate user experience guidelines to app developers (e.g. ask app not to track).

A "layer" itself represents costs that can be eliminated which can lead to lower prices for buyers.

That is why vertically integrated businesses can peel away business from existing non vertically integrated businesses with lower prices (legal liability notwithstanding). Sometimes it pays to have the business with more to lose insulated from liability by having a layer without much to lose.

And GO in Tokyo.

https://en.wikipedia.org/wiki/Go_(Japan)

Yup, marketing. And Waymo can launch at a smaller scale in the market knowing that overflow and rides that Waymo can't do can be done by human drivers.

It's a way for Waymo to prepare to turn on the spigot, too, if they dump a bunch more cars into the market.

It's important for Waymo to do all 3: show they can run the service themselves in a market, and work with both Uber and Lyft, to be able to get fair terms and the option to expand rapidly.

I think it’s more a matter of capital rather than marketing. Having hundreds or thousands of cars per city/metro is going to be capital intensive and that has to show up on someone’s books and financed somebow. They were bound to partner with rideshare sooner or later to derisk their own operation.

I think they will license the technology and get a cut of the profits. They want to focus on the technology, not building parking garages and maintenance lots everywhere. The local ride share companies will do that.

In Austin, Waymo app directs you to use uber instead.

What is the reason or benefit of them being so secretive about this?

LIDAR prices are falling fairly rapidly over time (although I’m not sure about the impact of tariffs). The car and computing resources are otherwise boring costs, maybe they are at around $200k/vehicle? That would be pretty easy to pay for a with a few months of rides. If most of the rides are going through the Waymo app, they aren’t paying a lot to uber and Lyft, and I doubt they are paying the full 30% to the ride sharing platforms anyways.

Waymo can hit break even even with the relatively expensive Jaguar SUVs and Driver 6 hardware suite. As someone else pointed out, Google is making more money than most people realize on a per unit basis. My back of the envelope estimate is at least $2000 per vehicle per week. That easily covers financing the capex with thousands left over for opex and overhead.

Just switching to the Hyundai SUVs takes tens of thousands of dollars out of capex.

Think about it in comparison to a real-life taxi or Uber and the math is surprisingly strong.

A real human driver needs to (vaguely) make a human salary, and cover things like gas, cleaning, car maintenance, car payments etc. That human salary is probably at least $50k if working full time in high end markets like SF. That “salary” also covers most OpEx costs for Uber like periodic cleaning and gas/charging of vehicles.

Lately, Uber has been $1.50-$3.00/mile in SF while Waymo has been $3.00+/m most times. Waymo also can drive 24/7/365 so should be able to command a higher per-car income.

I’ve heard rumors that a Waymo vehicle cost $200k to build with the sensors. Surely they’re aggressively lowering that cost now too. That’s 4-5 years of driving to pay off IF they’re making what Uber drivers make, but they’re almost certainly making much more.

Like Uber and Lyft before them, their biggest barrier to profitability is likely their HQ costs full of expensive engineering jobs - and they also have the R&D costs of training the car.

The Zeekr vehicle would've brought costs down, but it is now subject to a huge tariff. No telling how much that has set them back.

You could have a guy making minimum wage sit in the back and tell people not to act stupid.

That would be much cheaper than a union bus driver who can clear 100k.

Safer too since bus drivers often go tons of overtime which isn't great for being alert.

The "driver" could become more armed security and janitor.

The total cost of a bus is just over $100/hour (I last checked in 2019, so a bit more from inflation), and a driver directly makes around $30/hr plus benefits easially will put you over $50. Now add in all training and management that isn't directly per hour but if you didn't have a driver you wouldn't pay. You do have maintenance and fuel costs per hour, insurance and the cost of a bus. There are are a lot of "it depends" and I've never seen a formal analysis of the true costs, but to round numbers we can say half the costs are the driver and be close enough for discussion.

If we take the same $ and get rid of the drivers we can run twice as many buses and that increased service will get a lot of riders who previously thought the service was too bad. Though you will need to run the additional service for a few years before people figure out service is no longer bad and start using it.

Now we do have to assume some intelligence in bus routing. There are a lot of bad bus routes in cities that will never get more riders because of how stupid they are.

Of course you are right that politics gets in the picture. Rail gets far too much attention for projects where the lowly bus is cheaper for otherwise identical service (and where rail is needed it is often done wrong). As already pointed out unions will hate this plan and they have power to screw the rest of the population (who because they don't ride now don't think they would if this plan happened) and the environment (they care about the environment only after their own self interests.

Still the numbers work on paper: self driving buses should get a lot more riders on yoru bus system because you can afford to run more service.

> Are driver costs really the primary thing stopping increased bus route service?

On rail I'm not as sure but on bus yes. Drivers are the largest cost associated with a bus line. There's also a whole set of downstream costs like bathroom breaks which requires that routes are aligned with bathroom stops and that bathrooms are kept in good working order. Breaks also decrease bus frequency (humans need breaks!) and running more buses is often limited by the number of drivers you can hire.

However bus drivers often play a dual role in US transit of discouraging anti-social behavior so it's unclear to me if you could even get rid of the bus driver and the associated inefficiencies or you'd just need to replace them with a police officer and deal with the exact same problems.

Many bus drivers are unhappy having to play this role, so that's also a factor.

Are driver costs really the primary thing stopping increased bus route service?

It's usually that $transit_company needs $xxx,xxx,xxx to do a good job.

Politicians will only give it $yy,yyy,yyy to do the job.

A better bus and stop design eliminates more of that. You can have call ahead for help if you need to. A busy bus route normal people will be glad to help the disabled as well so long as what they need to do isn't hard and doesn't take much time (which it shouldn't - see better design...). For the rest paratransit should take them because despite the higher costs disabled people if they need to much help are taking time from everyone else who wants to get someplace not wait while someone is slowly loaded onto the bus.

The only people who say that are people who are justifying their not riding the bus - which is probably not usable for them anyway. Too many people do ride the bus all over the world (even in the US) to think that is really true. Statisticians and Psychologists have long known people lie about their reasons for doing something.

People seem happy to get short-haul flights when driving is an option, so riding with strangers can’t be the issue.

i was curious so i looked this up: LA Metro (combined bus and rail) has a monthly ridership of like 25 million [0]. that's nearly a million people taking shared public transit every day. anecdotally, i chose to ride metro rail over driving when i had a "real" commute. lots of people do.

people in NY and Chicago are fiercely defensive of their mass transit options. the bay area would be a terrible place without BART and Muni.

for all its problems, shared mass transit is a net good and there are millions of people in this country who prefer it.

[0] - https://opa.metro.net/MetroRidership/

For the company maybe, but for everyone else it is worse. Taxis are worse for the environment than cars because you have to count all the driving around empty picking people up (demand is rarely even in all directions). Rideshare is only of limited use outside fixed routes as people have places to be an detouring to pick up someone else makes them mad.

and RAPIDLY growing in Atlanta from what I see as I wander the city. I just saw one of their new Geely based vehicles today for the first time.

I will say as someone who is suspicious of self driving cars...they are not really worse than Atlanta drivers as a typical pedestrian. They are dangerous in different ways...but not necessarily more or less.

There are a ton of them in Sunnyvale, so I expect that area to flip to public availability soon.

The value of a business is based off how much value they will provide to others. In order to be a trillion dollar business you have to be providing a lot of value to others in the current or people are speculating you will provide value in the future.

Because Americans spend 93 billion hours driving each year and tens of thousands of people literally die each year in car crashes. Unlocking that time and those lives is an unimaginably large quality of life improvement.

moat is in institutional knowledge of operations in ride hailing industry.

Also, pleasing the customer, imagine opening Waymo app and not being able to order a taxi 40% of the time. With Lyft/Uber you can easily switch the ride mode and get a car with driver if all self driving cars are busy

it's not only about number of users. You also have regulations in different cities and states, existing models trained based on past supply demand behavior, somewhat optimized workflows for the ride hailing industry, payments, risks.

They both can build themselves, but if you provide solely self-driving ride hailing, a lot of times customers might not be able to find cars in upcoming 6-7 years until they ramp up full production to meet demand.

Vehicles also act as large portable storage, which is very convenient when you have kids. e.g. stroller, diaper bag, change of clothes, sports equipment, emergency supplies. It would be annoying to always have to keep things on your person. With a personal vehicle, you also don't have to worry about something falling out of a bag and being lost forever after the vehicle drives away, or accidentally leaving a piece of equipment in it; just go check the parking lot. Or what if you want to make a trip to multiple stores and want to keep bags from the first in the car while you're in the second?

EVs also have the potential to act as large backup batteries for your home.

You can also choose how to amortize your costs. My mom's been driving the same car for 22 years now.

I could certainly see a scenario years down the road where having your own self driving car is a luxury/status symbol.

I have one of those and all I can say is holy shit it works. It doesn't hook into GPS, so it's not totally self driving (at least mine isn't, there's a GitHub for their software), so I still gotta pay enough attention on the freeway to know when to exit, but after I get on the freeway, left right gas brake is all taken care of. Great for sitting in stop and go on the freeway.

It's also made me think that Waymo's a) don't need lidar, and b) don't actually need the extensive mapping that the public has been lead to believe they need. They're being overly cautious, because they know people's lives are on the line here.

I disagree. Building trains in America is next to impossible in the modern day. Obtaining the property for the railways would be extraordinarily difficult, because America has such strong property rights and is such a legalistic society. It's a recipe for way over-budget and behind schedule projects. Just look at the California project. There's also very little expertise in the rail industry in America due to underinvestment in recent decades. Furthermore, the built environment is so spread out because it was built for cars, so you don't get the clustering effects of density around train stations. Rail isn't that helpful if you have to walk another 30 minutes from the station to actually get to your destination.

Also, I think your assertion that autonomous cars don't solve traffic is partially wrong. If entire fleets of cars can "think" as a whole, you can avoid some traffic problems, such as traffic waves, that occur due to individual decision-makers.

The USA has proven to be... incapable of completing any public transport infrastructure anywhere near on budget or on time. This is a deeply rooted problem. Until this gets solved autonomous electric vehicles could theoretically just leapfrog the problem altogether. Point to point transportation also mostly solves the last mile problem.

We also need buses and mini-buses and taxis to get people to and from train stations. Autonomous driving makes this cheap and feasible.

Unfortunately, our airport traffic is getting a Tesla Tunnel instead of a real train.

Owning the user base seems like a huge strategic advantage.

Privatization of many things is turning out to be a failure. Sewage, water - see the UK, failure. Healthcare: USA, failure. Utilities: UK, USA, failure. Mail: Denmark, failure. Transportation: UK, USA, utter failure. Further privatization will deepen this failure.

It doesn't really help consumers whose whole point is to get from point A to B in the quickest and most comfortable manner.

It doesn't help traffic, and it only will if self driving cars are already the majority, which is a convenient perspective for developers of this tech, but is not viable and not a true statement.

I don't want to be that guy, but we all know trains and trams are the better tech. Luxury trains/trams would be a banger. Private rooms with better amenities than a car, why not?

The autonomous car industry is a few things: car protectionism, oil protectionism, autonomous warfare development and gimmicks.

> space

Speaking of which, if SpaceX announced today that they are going to put people on Mars in 5 years, I still would find that more believable than Tesla getting anywhere close to Waymo, in the same time frame.

His name is Rob. Rob-o-taxi.

Or the one with the fake man behind a white lever? https://youtu.be/eAkeZqAN_qU?t=20

Next to, not behind. I see a strong future for both Waymo and Tesla in the driverless car biz.

Tesla is probably a year behind on their software, but they can scale out infinitely faster than Waymo on the hardware.

Either way, we win.