Waymo and Uber's Potential Termination of Autonomous Taxi Business Partnership

Waymo, a subsidiary of Alphabet (GOOGL-US), is reportedly evaluating the termination of its partnership with Uber (UBER-US). According to the Financial Times, citing informed sources, the differences in operational management and commercial cooperation conditions between the two parties have been widening. Waymo has been internally discussing independent market expansion after the contract period. This news caused Uber's stock to drop by 4.3% on Friday.

The report indicates that Waymo has been discussing the termination of its cooperation with Uber. The partnership was first announced in 2023, aiming to combine Waymo's autonomous driving technology with Uber's vast ride-hailing platform to expand the Robotaxi market.

However, informed sources reveal that as the cooperation deepened, the friction between the two companies on operational and commercial levels increased.

Waymo is said to be dissatisfied with Uber's performance in vehicle management, including the quality of vehicle cleanliness and maintenance, and the arrangement of dispatch routes. On the other hand, Uber criticizes Waymo's fleet for frequently stopping services suddenly during bad weather, affecting platform stability, and believes that the current cooperation model's financial conditions are "difficult to maintain in the long term."

The Financial Times, citing informed sources, states that the two companies are now pursuing different development goals, gradually weakening the cooperation foundation.

The report also points out that Waymo has notified Uber of its plan to switch to an independent operating model in relevant markets after January 2028, the time allowed by the current cooperation contract, no longer relying on the Uber platform to provide Robotaxi ride-hailing services.

As of now, Waymo and Uber have not responded to the report, and Reuters also stated that it could not independently verify the information disclosed by the Financial Times.

In fact, there have been signs of loosening in the cooperation between the two parties. In late June, Waymo and Uber announced the end of their autonomous driving cooperation project in Phoenix, Arizona, USA.

Currently, Waymo's autonomous taxis can still be hailed through the Uber platform in Austin, Texas, and Atlanta, Georgia, USA. However, if Waymo ultimately decides to operate independently after 2028, it will mean that Alphabet may directly control the Robotaxi service platform and customer relationships, further increasing its control over the autonomous taxi market.

In recent years, Waymo has been continuously expanding its Robotaxi layout and is currently providing commercial autonomous ride-hailing services in multiple cities in the United States, being regarded as one of the companies with the fastest progress in the commercialization of autonomous taxis worldwide. On the other hand, Uber continues to cooperate with multiple autonomous driving technology companies, hoping to maintain its competitive advantage in the shared ride-hailing market under the strategy of not developing autonomous systems on its own.

Market observers believe that if Waymo ultimately chooses independent development, it will not only change the cooperation model between the two parties but also cause the competitive landscape of the Robotaxi market to undergo another major change.