Google-owned autonomous cab company Waymo has revealed it will stop allowing Uber users to book its robo-cabs, hours before the OG rideshare giant made a case for all autonomous vehicle fleet operators to use its platform instead of creating their own.
This slow-motion fender bender played out across Wednesday, starting with Waymo Co-CEO Tekedra Mawakana telling Bloomberg that her company would end a partnership that saw it work exclusively with Uber in Austin and Atlanta.
Mawakana said Waymo wasn’t happy about the fact that when users of Uber’s app requested a ride in one of its robo-cabs, they weren’t guaranteed to get one.
News of that break-up came on the same day that Uber announced its quarterly results. As is common on such occasions, the company published remarks [PDF] its execs intend to make during an earnings call.
CEO Dara Khosrowshahi used those remarks to promote the idea that Uber is the natural home for robotaxi fleet operators, because it already delivers around 30 percent higher trips per vehicle per day compared to apps run by autonomous cab companies. He said that higher utilization rate, plus use of shared charging and maintenance infrastructure, can deliver “higher fleet profitability even after paying Uber’s marketplace fee.”
“As autonomous technology becomes more widely available, we believe this ability to commercialize vehicles profitably will become an increasingly important source of competitive advantage and value capture.”
The two events are deliciously ironic, because Uber is arguing the scale of its platform makes it the ideal host for third-party players – just as Google does with its search, app store, and YouTube services. Left unsaid is that the two companies hold concerningly dominant positions in their respective markets.
Khosrowshahi also outlined more ways Uber intends to strengthen its position, including by putting around 2,000 robo-cabs on the road in 2027, before “a much larger commercial ramp beginning in 2028.” That plan means Uber will run some cars itself and rely on third-party robo-cab operators who allow bookings on its app.
“Importantly, building a broad ecosystem does not mean spreading our resources evenly,” the CEO explained. “We intend to maintain an open platform while concentrating capital, integration resources, and hands-on deployment support behind a smaller group of partners with the clearest paths to commercial scale and attractive economics at maturity.”
Or in other words, as Uber uses more robo-cabs, it will try to maximize profits.
Uber users booked $59.8 billion worth of services in its third quarter, up 20 percent year-over-year. The company recognized $14.75 billion of that as revenue, a ten percent improvement.
Rideshare accounted for $29.5 billion of bookings and $7.5 billion of revenue. Delivery services brought in $5.5 billion of revenue on $28.5 billion of bookings.
No wonder Khosrowshahi wants more robo-cabs: they’ll boost Uber’s more lucrative business.
The company might need that boost because Australia’s High Court yesterday decided [PDF] that the company must pay AU$81 million ($57 million) in State payroll taxes because the fees paid to rideshare drivers are effectively wages. While the case considered Uber’s activities in one of Australia’s six States, all of them charge payroll tax. The case is one of many around the world in which courts have found gig workers should be treated as employees for legal and tax purposes. The High Court is Australia’s highest judicial authority and like-minded jurisdictions around the world are aware of its decisions, potentially making more trouble for Uber further down the road. ®
