Waymo Faces Challenges in Scaling and Profitability Amid $100,000 Costs and Impact on Uber

Waymo, Google's autonomous driving unit, is facing significant challenges in scaling its operations and achieving profitability. Despite positive feedback on Waymo's technology and its strategic automotive partnerships, industry experts highlight the difficulty of reducing costs necessary for widespread roll-out. Waymo's vehicles cost over $100,000 each, posing a major hurdle to profitability. Additionally, there are concerns about whether Waymo can generate positive gross margins on each ride. The impact of Waymo's roll-out on Uber's profits is also under scrutiny, particularly in dense, tier-1 metropolitan areas where Uber's utilization and take rates are high. Analysts question if the initial 5-10% share of autonomous vehicles could disproportionately impact Uber's profits by 15-20%. Google's financial backing has enabled Waymo to develop prototypes, currently numbering in the hundreds, but the transition to commercial viability remains uncertain.