Waymo's Expansion: Shaping the Future of Autonomous Vehicles

Technological Advancements Driving Waymo's Growth

Waymo's growth is driven by consistent investment in building leading autonomous driving technology, supported by advancements in AI and self-driving systems from companies like Nvidia and Tesla. These technological strides are propelling the industry towards unsupervised full self-driving at an exponential pace.

"which is consistent with recent annual investment levels will enable Waymo to continue to build the world's leading autonomous driving technology company.To close, this is my 56th and last earnings call, 37 of them at Alphabet." --- (GOOG, earning call, 2024/Q2)

"Year-on-year growth was driven primarily by self-driving. We supported Xiaomi in the successful launch of its first electric vehicle, the SU7 sedan built on the NVIDIA DRIVE Orin, our AI car computer for software-defined AV fleets." --- (NVDA, earning call, 2025/Q1)

"Well, you should try it. That would be a good thing to do. And if you just plot the points on the curve of how well autonomy is progressing and just believe the curve, it's headed towards unsupervised full self driving very quickly at an exponential pace.If you just if you just yeah." --- (TSLA, event transcript, 2024/06/13)

"This new round of funding, which is consistent with recent annual investment levels will enable Waymo to continue to build the world's leading autonomous driving technology company.To close, this is my 56th and last earnings" --- (GOOG, earning call, 2024/Q2)

"So we now have over 300 billion miles that have been driven with FSD V12. Since the launch of full self-driving, supervised full self-driving, it's become very clear that the vision-based approach with end to end neural networks is the right solution for scalable autonomy." --- (TSLA, earning call, 2024/Q1)

Strategic Partnerships and Collaborations

Waymo's strategic partnerships and collaborations are pivotal in advancing autonomous vehicle technology. Collaborations like those between Mobileye and Zeekr, and Uber and BYD, highlight the industry's trend towards leveraging joint efforts to enhance technological capabilities and expand market reach globally.

""We will hold a more opening-up cooperation and strengthen the collaboration with Mobileye in the future, to reach new technological milestones and provide a better driving experience for our users globally."" --- (INTC, press release, 2024/08/01)

"Electrification updates: In July, announced a multi-year strategic partnership with BYD to bring 100,000 new electric vehicles onto the Uber platform across key global markets, with plans to collaborate on future BYD autonomous-capable vehicles to be deployed on the Uber platform." --- (UBER, press release, 2024/08/06)

"As vice chair, Lawler will focus on: The next phase of Ford's strategic development, including important choices across technologies, markets, alliances and segments All current and future global partnerships, which are increasingly vital to Ford's customer insight, technological capabilities and competitiveness, and Engagement with global leaders as vice chair, including in China, Southeast Asia and Europe, to advance industry-critical policy in areas vital to Ford's strategic and commercial imperatives." --- (Ford, press release, 2024/05/10)

"Companies will leverage successful technology collaboration and expand Mobileye SuperVision™ platform to future Zeekr models globally Building on the success from their collaboration over the last several years, Zeekr and Mobileye have announced their plan to accelerate technology localization in China, integrate Mobileye technologies into the next-generation Zeekr models, and further their state-of-the-art driving safety and automation there and in the global market." --- (INTC, press release, 2024/08/01)

"Multi-market agreement to offer best-in-class EV pricing and financing for Uber drivers Companies also agree to collaborate on future BYD autonomous-capable vehicles to be deployed on the Uber platform Uber Technologies, Inc. (NYSE:UBER) and BYD Co. Ltd. today announced a multi-year strategic partnership designed to bring 100,000 new BYD electric vehicles onto the Uber platform across key global markets." --- (UBER, press release, 2024/07/31)

Regulatory Challenges and Compliance

Waymo faces significant regulatory challenges as the global landscape evolves, with non-compliance posing substantial risks. While regulatory approval isn't seen as a limiting factor, the deployment of self-driving capabilities varies by region. Companies must adapt to regulatory frameworks, though predicting changes remains difficult, highlighting the profound risks to investors.

"As the regulatory landscape continues to evolve globally, failure to comply with relevant regulation may lead to significant risk to the company." --- (GOOG, AGM, 2024/06/07)

"So I don't think regulatory approval will be a limiting factor.I should also say that the self-driving capabilities of this are deployed outside of North America are far behind that in, in North America." --- (TSLA, earning call, 2024/Q2)

"So it's something we have a lot of flexibility. And obviously, we intend to meet the regulatory environment. It's really hard for me to predict what the timeline would be if something is going to change." --- (GM, earning call, 2024/Q2)

"Obviously, there has to be a regulatory framework to put in place. And as the technology develops, we think that actually you're not going to make a jump from one tech -- human drivers fully to AV." --- (UBER, earning call, 2024/Q1)

"While the societal risks seem clear, the risks to investors are also profound. Alphabet has been subject to heightened regulatory and litigation risk in recent years." --- (GOOG, event transcript, 2024/06/07)

Market Competition and Positioning

Waymo faces strong competition from Tesla, which boasts a fully integrated product and scalable approach, and Uber, uniquely positioned to deploy AV technology at scale. Ford leverages meaningful supplier scale, while GM needs restructuring to compete amid a shift towards new energy vehicles and Chinese brands.

"So we feel pretty good about where we are in the market. We realize that competition is strong, but we have a pretty strong value proposition with offering a fully integrated product with our own power electronics and site level controls." --- (TSLA, earning call, 2024/Q2)

"should give investors confidence that we’ve built the capital discipline and operational muscle to perform well in any scenario. Second, autonomous - put simply, Uber is uniquely positioned to offer tremendous value for AV players looking to deploy their technology at scale." --- (UBER, earning call, 2024/Q2)

"Now we have really meaningful scale for our suppliers. A lot of our competitors will be starting from scratch." --- (F, earning call, 2024/Q1)

"It needs some restructuring work to get done to be able to compete in the marketplace where we see much more customer orientation towards new energy vehicles as well as relatively recent preferencing to Chinese brands." --- (GM, conference, 2024/08/08)

"our approach to autonomy is scalable and that accomplishments in artificial intelligence, along with leveraging our existing production lines to get our next generation products to market faster, are essential to achieving our mission." --- (TSLA, event transcript, 2024/06/13)

Customer Adoption and Market Penetration

Waymo's market penetration remains low, with less than 20% consumer engagement in top markets, indicating significant growth potential. Similarly, General Motors has successfully converted 54% of new EV buyers, highlighting the growing demand and adoption of new automotive technologies, including autonomous vehicles.

"Maybe one data point on TAM that I think is helpful for folks is our monthly penetration of consumers, and we define that as folks who are over 18 years, is less than 20% across our top 10 countries, so a lot of room to run there. Another key driver will be frequency, which I think folks understand to be how our monthly active--how many times our monthly actives engage with the platform." --- (UBER, earning call, 2024/Q2)

"So we think and we've seen it as evidenced by the fact that 54% of our EV buyers to date are new to General Motors that we can go in and convert some of those early adopters while we're also seeing EV demand continue to grow even slowly." --- (GM, conference, 2024/08/08)

"Your line is open. Mark Mahaney: Okay, thanks. Two questions please. On the TAM comment, Prashanth, that you made earlier, I think you said in your top 10 markets, less than 20% penetration." --- (UBER, earning call, 2024/Q2)

"So still significant opportunity for us to increase penetration there. And we are targeting that through a few different means." --- (UBER, conference, 2024/05/30)

Operational Challenges and Solutions

Waymo addresses operational challenges by focusing on cost reduction and a streamlined operational plan, resuming operations in Phoenix, and conducting extensive testing. Additionally, deploying technology in the next-generation Chevrolet Bolt EUV aims to lower costs and mitigate regulatory uncertainties, enhancing operational efficiency and compliance.

"our cost reduction activities and a more focused operational plan. As Mary mentioned, Cruise is resuming operations in Phoenix, along with testing in simulated environments and on closed courses while they work to earn trust and build partnerships with regulators and customers." --- (GM, earning call, 2024/Q1)

"Cruise now expects to deploy this technology in a vehicle based on the next generation Chevrolet Bolt EUV, which we expect to result in a lower cost per vehicle solution while also reducing regulatory uncertainty that surrounded the Cruise Origin." --- (GM, sec filing, 2024/Q2)