Uber reportedly wants a partnership with Waymo – here's what that means for both sides (GOOGL)

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March 7, 2018 4:36 PM

Ride-hailing giant Uber reportedly wants to partner with Waymo, Alphabet's self-driving technology spinoff, to allow its customers to hail rides from Waymo's autonomous cars, according to Engadget.

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Ride-hailing giant Uber reportedly wants to partner with Waymo, Alphabet's self-driving technology spinoff, to allow its customers to hail rides from Waymo's autonomous cars, according toEngadget.

Such a partnership would likely be similar to Waymo'sagreementwith Lyft, and allow Uber customers to request rides from Waymo's self-driving Chrysler minivans. Although it's unclear which geographies would be included in such a tie-up, Waymo is planning to launch its self-driving cars commercially this year in Arizona as part of its own ride-hailing service, so an agreement could give Uber customers there access to these cars.

An agreement may be a possibility now that the companies settled their longstanding legal dispute last month. It's still unknown whether Waymo is open to this partnership at all, though executives at the company have “long considered Uber an obvious potential partner,” according toThe Information.

Uber likely hopes a partnership with Waymo would help it deploy more self-driving cars in its fleet sooner, giving it a host of advantages. Waymo is widely considered the frontrunner to deploy self-driving cars, and recently got approval from the Arizona DMV to operate a commercial ride-hailing service in the state with these vehicles.

Giving Uber's customers access to these vehicles would seemingly allow the ride-hailing giant to cement an image as an early mover and innovator by having autonomous cars in its fleet, even if Uber didn't do the legwork to build the technologies powering these cars.

CEO Dara Khosrowshahi recently said the company is on track to deploy its own autonomous cars in its fleet sometime next year, but a partnership with Waymo could allow it to become one of the first companies to launch autonomous vehicles in multiple locations in the US, potentially allowing it to gain valuable insights on how consumers in different markets view self-driving cars.

Meanwhile, for Waymo, such a partnership could help the company scale its autonomous cars more quickly, but it may also simultaneously hinder its monetization ability and brand image. Waymo seems intent to try and operate its own ride-hailing service, but its partnership with Lyft suggests that it's keeping its options open to find multiple avenues to generate revenue from its self-driving cars.

A partnership with Uber would play into this approach, opening up Uber's millions of users to Waymo's vehicles, though it would likely split revenue from these rides with Uber. More importantly, Uber has a vast global network that Waymo could leverage to quickly scale up its autonomous cars across multiple geographies in the US and abroad. However, if Waymo is intent on owning the customer relationship, and all of the data that comes with that, it may be reluctant to partner extensively with Uber and allow consumers to book its vehicles through Uber's app.

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