After years and years of touting the tech, Elon Musk finally launched driverless taxis on the streets of Austin, Texas, this Sunday.
Shares of Tesla popped 8% yesterday after the robotaxi launch went smoothly. “We took two approximately 15 minute rides around Austin and the key takeaways are that it was a comfortable, safe, and personalized experience,” wrote Wedbush equity analyst and Tesla bull Dan Ives, who attended the Sunday event. “The $1 trillion autonomous journey begins,” he added.
But maybe investors popped the champagne a little too soon. Today, shares dropped 2.35% after a series of traffic violations were caught on camera by bystanders, including driverless vehicles going over the speed limit, swerving across lanes, and taking unnecessary pauses before turns.
Investors weren’t the only ones questioning how good a driver AI really is: The National Highway Traffic Administration (NHTSA) told Yahoo Finance that it is aware of the incidents and that its investigation into Tesla’s self-driving technology is still ongoing.
Two companies, zero drivers
But perhaps the biggest threat to Tesla’s aspiring robataxi empire is the stiff competition from other autonomous driving outfits, which have been gaining speed over the past year.
Just look at Alphabet-owned Waymo, which opened for business in Atlanta via a partnership with Uber today. Shares of Uber jumped 7.52% after the successful launch.
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While Tesla hogged the spotlight this weekend with 10 to 20 Model Ys providing robotaxi services in Austin, Waymo already operates 250,000 driverless taxis rides per week, and has 1,500 vehicles across Los Angeles, San Francisco, Phoenix, Austin, and announced plans to start testing in New York City. Executives have said the rides are a success, too, with customers in Austin giving Waymo & Uber an average rating of 4.9 out of 5 stars.
Waymo isn’t Tesla’s only threat, either: Lyft is partnering with Toyota-backed May Mobility to launch self-driving taxis, which could hit the road in Atlanta as soon as this summer. Amazon’s Zoox has been testing its own vehicles, too. Uber has also partnered with Chinese firm WeRide to offer driverless taxis in Abu Dhabi.
Big Tech is splashing out on robotaxi startups for a reason: The market is projected to grow from its current $1.2 billion to $17.18 billion by 2029, according to some estimates. The tech can—in theory—make roads safer, provide transportation for people who don’t drive, and reduce congestion. But it’s starting to look like one crowded race.—LB