In news this week, Elon Musk-owned electric vehicle firm Tesla snubbed Uber’s attempt at a robotaxi partnership. The CEO of the ride-hailing firm, Dara Khosrowshahi, admitted on stage at The Future Investment Initiative (FII) summit in Miami that Musk was not open to making the robotaxis his firm plans to launch this year available on […]
In news this week, Elon Musk-owned electric vehicle firm Tesla snubbed Uber’s attempt at a robotaxi partnership.
The CEO of the ride-hailing firm, Dara Khosrowshahi, admitted on stage at The Future Investment Initiative (FII) summit in Miami that Musk was not open to making the robotaxis his firm plans to launch this year available on the platform.
The Uber boss says that he thought it made “a lot of economic sense” for his firm to be a platform for Tesla drivers. “What we bring is demand to the [autonomous vehicle] ecosystem when demand often is quite variable.”
Both Uber and ride-hailing competitor Lyft are planning to deploy autonomous taxis in the US this year. Uber has partnered with Waymo to deploy its self-driving Jaguar I-Pace EVs, initially in Austin, and later in Atlanta.
Similarly, Tesla said during its Q4 2024 earnings call that it plans to deploy its first driverless taxis in Austin in June.
“They want to build it alone, so to some extent in Austin, we and Waymo will be competing with Tesla when they launch,” the Uber CEO admitted.
Meanwhile, rival ride-hailer Lyft has partnered with startup May Mobility, AV tech firm Mobileye, and dashcam company Nexar to deploy robotaxis in Atlanta, too, while Waymo robotaxis are now rolling through the streets of San Francisco, Austin, Phoenix, and LA.
What this, and the conversations above, highlight is that robotaxis are increasingly appearing on the roads and they’re not slowing down.
But what problem are robotaxis solving?
According to Uber’s statistics, the app alone has 7.8 million drivers currently working for it, and they’re in demand, as the firm has 161 million active monthly users.
In the last quarter, the firm made 2.8 billion trips and processed over $41 billion worth of bookings in Q3 of 2024.
Why have self-driving cars become public enemy number one?
Eran Ofir, CEO of autonomous driving software firm Imagry, points out that robotaxis don’t solve “the fundamental problems of public transportation as it doesn’t reduce the number of cars on the road,” – if anything, he believes it exacerbates the situation.
“There doesn’t seem to be a shortage of rideshare options in city centres such as Uber, Lyft, yellow cabs, so exactly what problem do robotaxis solve?” he questions.
While a robotaxi may take money away from hiring a driver, he argues that they’re expensive to run. Not only is it the vehicle, but it’s hardware, communications, and HD maps. Plus, autonomous taxis will also have staff in a control room for road safety.
Eran Ofir, CEO, Imagry
Still, Ofir suggests that Musk has a chance at building a credible business case if it manages to turn its level three autonomous vehicles (where a person remains in the driver’s seat to take over when necessary) into level four (driverless) — allowing Tesla owners to essentially allow their vehicle to function as a robotaxi.
Thomas Zimmerman, the CEO of ride-hailing firm Freenow, believes that robotaxis challenge social responsibility. “If taxis become fully automated, there’s a large group of workers who could be affected, we need to consider what happens to them,” he says.
“For passengers, there’s also the issue that the driver provides more than just the driving service. For example, tourists might ask the driver for recommendations on places to eat or where to go.”
Zimmerman also points out the assistance that drivers provide, such as help with heavy luggage, security, and the need for medical transport and aid getting in and out of the car.
“For a 25-year-old who’s tech-savvy, getting a ride in a robotaxi is great, but it’s a different situation for someone who needs help with mobility.”
The road ahead
Global expansion outside of the US is also thought of as unlikely: “If you look at the technology, it’s already very advanced. But I still think it works better in cities with a grid-like layout, such as New York or San Francisco, where streets are straight.”
“But if you compare that to cities like London or Rome, which have narrow, one-way streets, it becomes more complicated. These older cities pose a challenge for autonomous vehicles.”
Zimmerman adds that Europe has stricter regulations compared to other parts of the world.
“There hasn’t been much progress in terms of regulation around robotaxis, especially concerning liability. That’s why these companies are testing in other regions, like the US, where regulations are less strict.”
At Imagry, Ofir argues that autonomous vehicles are needed mostly for public transport. “Buses can carry 35-50 passengers, they can go everywhere, they solve the 16% and growing global shortage of bus drivers, and they reduce the number of vehicles on the road, contributing to greener and less congested cities.”
Also to help cities become less polluted, Zimmerman says that he wants it to be “the norm for taxis to be electric.”
Thomas Zimmerman, CEO, Freenow
He adds that Freenow is working with cities to provide the traffic data it collects through its ride-hailing app to make them aware of jammed polluting areas.
