What’s Going On at Aurora? Why Waymo Needs More Cars, and Has Waymo Cooled on Lyft?

Executive Summary

This week on Autonomy Markets, Grayson Brulte and Walter Piecyk discuss the shocking resignation of Aurora co-founder Sterling Anderson, exploring the deep implications for the company’s key partnerships with Volvo and Uber. 

They also analyzed Waymo’s pressing need for more vehicles to fuel their expansion into new markets and highways, and contrast Uber’s aggressive, multi-partner autonomy strategy with a notable cooling in the relationship between Waymo and Lyft.

Key Autonomy Markets Episode Questions Answered

Key Autonomy Markets Topics & Timestamps

[00:20] Sterling Anderson’s shocking resignation from Aurora

Sterling Anderson, a co-founder of Aurora, unexpectedly resigned from his position and the board, sending “shock waves” across the industry. The announcement was seen as rushed and unplanned. His departure raises concerns about Aurora’s critical partnership with Volvo, which he personally managed. The move also drew scrutiny to Aurora’s relationship with Uber, which holds a significant ownership stake in the company. Analysts on Aurora’s earnings call were criticized for not asking any questions about the high-profile resignation.

[09:25] Waymo’s new Mesa factory and vehicle supply challenges

Waymo announced a new 239,000-square-foot facility in Mesa, Arizona, with Magna to produce its vehicles. While one speaker previously underestimated Waymo’s fleet size, it is believed to be around 3,500 cars. Despite this number, a major challenge for Waymo is having enough vehicles to expand into new markets or launch on highways. It’s estimated they would need to double or even quadruple their fleet in a given market to support highway service without negatively impacting existing coverage areas.

[15:25] On-the-ground report of Waymo testing in Washington D.C.

Field research in Georgetown, D.C. revealed that Waymo is currently operating a small fleet of five to 10 vehicles for both mapping and testing. Operations are limited to the hours between 5:00 PM and 11:00 PM. The company has not yet established a physical depot, instead using a parking lot in Union Market and public charging stations at a Walmart and a Safeway.

[22:30] Has Waymo cooled on its relationship with Lyft?

During Lyft’s recent earnings call, there was a dramatic and notable change in tone regarding the company’s relationship with Waymo. This has led to concern that Waymo may have “cooled” on the partnership or that Lyft may be “boxed out”. One theory is that a Lyft executive may have made a public statement that Waymo disliked. It was also noted that Waymo’s limited vehicle supply restricts its ability to partner with anyone on new market launches.

[25:40] Uber’s aggressive AV strategy, including a $100M investment in WeRide

Uber continues to pursue an aggressive, multi-partner strategy in autonomy by investing another $100 million into WeRide. This approach of developing numerous relationships allows Uber to partner with emerging AV companies, such as Chinese firms expanding into Europe, before they can build their own platforms. Data from their partnership in Austin shows that Waymo vehicles on the Uber network complete more trips per day than 99% of human drivers.

[29:50] Questions surrounding Zoox’s lack of progress and recent recalls

Zoox’s co-founder and CTO announced plans to ramp up production of its purpose-built vehicle, but this has been met with skepticism. The company has not yet launched a commercial service and has faced multiple recalls, including a recent one for a crash in Las Vegas. Confidence in the company’s progress has diminished, and analysts no longer ask questions about Zoox on Amazon’s earnings calls.

[34:15] Rivian’s upcoming Autonomy AI day and in-house development

Rivian announced it is preparing for an “autonomy AI day” in the fall to showcase its new autonomy platform, which features an entirely new perception stack and compute system. This move is seen as a reaction to market pressure and the growing importance of autonomy as a factor in consumer purchase decisions. However, there is skepticism about whether Rivian is developing true autonomy versus an advanced driver-assistance system (ADAS) and if it has the financial resources to build a full stack internally without a partner.

Full Episode Transcript

Grayson Brulte: Walt, while you were busy covered earnings and most importantly, riding on rollercoasters at Epic Universal, I did what a good analyst is. I hit the road and I went to DC to really learn firsthand what Waymo’s doing in DC and when I’m there, a bomb goes off on Thursday, not a bomb in dc, but a bomb on Aurora’s earnings call. Sterling Anderson resigned from the company Street product officer and the board Wal. What the heck is going on? 

Walter Piecyk: Yeah, I think we have a lot of great topics to get into this week in terms of Waymo and Uber and Lyft earnings. We have to address Aurora at the outset. But before we do that, I wanna also apologize to our podcast listeners for the first 10 minutes of the audio quality. Last week we had some compression issues that we think are gonna be resolved this week, or it’s also possible, Grayson was trying to cut me off ’cause I had some great insights, I think in that first 10 minutes of the podcast last week. I can’t even remember what the topic was, but apologies, and I think that’s gonna get fixed. 

Grayson Brulte: I have to censor you from time to time, Walter Piecyk. That’s my job. 

Walter Piecyk: Uh, and, and for those that are considering a vacation, I will say, I’ll give you my quick review here. I, I went to the Epics, um, new park that is opening on May 22nd is a very immersive experience. The new Harry Potter ride is great, but they’ve got a lot of good worlds for how to train your Dragon and Nintendo world. And uh, know, Comcast really did a great job with that, with that epic universe. 

Grayson Brulte: Did a great job, and then Walt Disney came, raised from his grave, and Bob Iger pulled a rabbit out of his hat. They’re going to Abu Dhabi with no money invested. 

Walter Piecyk: mean that, that was, from my standpoint, they were just trying, they knew that Comcast was gonna have a bunch of investors checking out the new park, and for them to announce that Abu Dhabi thing and deliver earnings, not even move their earnings date. So everyone was scrambling to listen to the Disney earnings call while at Epic Universe. That’s like that, that’s some classic corporate stuff right there that that tend tends to happen from time to time. 

Grayson Brulte: It’s classic corporate timing, and if you look at classic corporate timing, to me, the Sterling Anderson announcement did not seem planned. It seemed, I hate to say it rushed. 

Walter Piecyk: It sent you’re, you’re right, shock waves across the industry. Everyone’s like scrambling. Where is he going? What is he doing? I don’t think there’s an answer yet. They talk about an iconic company, like there’s only one iconic company that I can think of. It’s Apple and is Apple, you know, redoing its or, or restarting into the autonomy world. You can speculate that on that. I don’t think that that’s the case. , And the company has, you know, given some indication that he’s not gonna compete, but then. If he’s not gonna compete at whatever his new job is, then why is he leaving the board? It, it doesn’t, something’s not adding up there. 

Grayson Brulte: something’s definitely not adding up in. I went on ChatGPT, iconic companies one, Disney, two, Coca-Cola. I don’t see either of those going, but then I gotta give credit to my wife here. My wife said he’s going home, he’s going to Tesla. Could that be a possibility? 

Walter Piecyk: I mean, if you’re going to Tesla, how are you not doing that in a competitive role with what Aurora is doing? And, , you know, what’s shocking to me is I’m on this earnings call, by the way, everyone’s asking about this, right? Our phones have been ringing off the hook. Everyone in the industry. had how many analysts ask questions on that call and not one analyst on that earnings call bothers to ask for more color on what’s going on with this resignation. It, it was insane. This is what I have to deal with. Grayson on a daily basis with analysts on earnings call, they sit there and just kiss ass. Um, to management teams. Oh, congrats on your driver out this, that, and the other thing, and never ask the question that matters. And, and what is Aurora’s stock doing as a result today? it is down 5% because perhaps, you know, you should have asked for some clarity on when one of the co-founders leave the company. 

Grayson Brulte: Walter Piecyk, we should start a new section. Analyst failures or analyst fail, but this goes up there and then I get these notes. We’re all subscribed to ’em. They’re not talking about one of the most important individuals in that company leaving the gentleman. And this is an SEC filing. This is on video. It’s not me just gossiping. He managed the Volvo relationship. He was the one who worked with Nils hand in hand and Volvo to see the VNL become to a life. So now I’m sitting here as an analyst and I’m thinking about this is the Volvo relationship in trouble. ’cause one they didn’t launch with the Volvo they launched with with the PAC car Peter built. There’s a lot more here than meets the eye is what I’ll say. And I’d like clarity. 

Walter Piecyk: I mean, look, I think there’s even bigger and broader questions than that beyond the Volvo relationship, which obviously extremely important. We, you know, you and I both. Had a great time with Volvo down in, in, uh, Texas. I think that that can be a great partnership for them. The bigger issue I think is, you know, Sterling, let’s go back to the Bigelow battle. Um, when Sterling had that debate with, , the CEO of of wbe, showed the culture that he brought to the company that I think is much needed when you’re talking about a startup company, an aggressive. Uh, personality that can push the, the product forward. So you’ve had now two co-founders leave the company, the latest one, to your point, Volvo relationship, know, just kind of a driving force within the company. Where does that leave Aurora? And, and then I guess more broadly, ’cause I always like to re relate this back to our friends at Uber, how does Uber look at this? This has been a strong partner with Uber from the beginning. And how are they viewing, you know, this change in management team and how will that affect their relationship and then frankly, their ownership in the company. 

Grayson Brulte: I’m asking a lot of questions. Mr. Anderson. Sterling is not just a driving force inside of rar. He’s a huge asset to the autonomy industry. As a whole, if I’m Dara, I’m on the phone to Chris M and I’m on the phone to the Aurora board. What the hell’s going on? I want answers. They’re north of 40% ownership stake right now, if I’m Olivia Hu, who’s fantastic and runs Uber Freight for autonomy, I’m asking questions. I, they need answers, we need clarity. This, this was not planned despite the spin that I’m getting. In my humble opinion, this was not planned. 

Walter Piecyk: So I don’t, that’s obviously not planned based on what we read. So it was, it was Sterling going elsewhere, so we’re just gonna have to wait to see. , And in the meantime, look still congrats to Aurora for meeting that milestone. You know? Now the next steps are things like. Getting to tens of cars, doing more rides, you know, getting, proving that they can, they can operate in the dark with bad rain conditions and things like that. , You know, they wanna move forward. I, I, I will say that I think the confidence level on the call relative to them describing no other competition in that trucking space, I also a little off, um, you know, given that what we know is happening at Kodiak and, and some of these other companies that we’ve been. With in the, in their, you know, kind of movement towards driver out, you know, the, the trucking world is certainly gonna evolve, , you know, dramatically, I think over the next year or two. hopefully that, that confidence in saying, Hey, we’re the best, , you know, and the loss of Sterling, and the billion dollars that they have on the balance sheet. Doesn’t result in a complacent company that tries to drive even faster forward in, you know, not getting to tens of cars, but getting to hundreds if not thousands of cars on, on their timeline, um, to deliver service. ’cause there is a large opportunity there, but there are competitors that are gaining momentum. 

Grayson Brulte: By the end of the year in the SEC filing, they said they’re gonna get to tens of trucks. That’s 10. So let’s say 2030. That’s not very many, and they do have competition in Kodiak. I need to re remind our viewers and remind Aurora Kodiak’s operating drive route in the Permian Basin profitably generating revenue. They’re, they’re going through a process to go public. So the question is, Don Burnett talked about this on the investor outlook for Kodiak going public. The metric is. Revenue per mile. When are we gonna see that metric? Aurora came out and said, we’ve driven 4,000 fully autonomous miles, but we don’t have a revenue metric for that. When does Don Burnett’s metric become the defacto metric? 

Walter Piecyk: Well, that would require an analyst on the earnings call actually asking question, asking for that information rather than just kissing their ass about the, you know, the driver out that they accomplished a week ago. 

Grayson Brulte: But this is why I was very disappointed. They didn’t call the great Walter Piecyk Piic was denied a question. Why the hell do you think that happened? 

Walter Piecyk: I have no idea, Grayson. It’s fine. They can choose, , what, what’s the saying? You can run, but you can hide. , We have our questions lined up and there’s, we, we do have plenty of methods that we use to get answers to our questions. 

Grayson Brulte: Walter Piecyk’s got a lot of questions. I have a lot of questions. We hope for the market’s sake, we will get clarity and I’d like to see clarity on where they’re going from a business model perspective. Right now they’re ramping up an in-house fleet 26 27. They’re gonna go to licensing. I’d like to see some more clarity there and I’d like to see clarity around the OEM partners. That’s something that we need to to see. 

Walter Piecyk: There was no question about Toyota. I mean, I don’t think there’s anything changed in that relationship. they’re gonna be focused on the opportunity that they have on trucking. But again, no update on the, the Toyota relationship, which seems timely given that Waymo just did a new deal with Toyota. Like talk about like where do all these different partners that Toyota’s developing fit in and you know, is the Aurora driver still something that we should expect over time? You know, in the Toyota Sienna, which was the, you know, which was the original goal there. 

Grayson Brulte: We don’t know what we do know. Toyota’s making a variety of bets and what we also do know, Waymo’s ramping up, they announced a 239,000 square foot facility in Mesa, Arizona with Magna to produce the vehicles, the most impressive part of that wall. 30 minutes after the vehicles at the factory, they go into service. That’s an impressive ability to scale. 

Walter Piecyk: And I have to acknowledge, I think, being wrong, uh, to a certain extent. ’cause I think in, in recent podcasts I’ve really, I don’t wanna say attacked, but , I think criticized Waymo for their lack of supply and that limiting their ability and providing competitors. catch up with them. So I thought that the max was like 2000 cars. Yes, we had seen pictures on Reddit suggesting more, seems like it’s 3,500 cars. I also think Grayson, though it’s a little odd to boast on social media about a this big Mesa factory that’s still doing something very expensive, which is buy an expensive Jaguar and put your expensive aftermarket refitting. Your sensors onto this car as opposed to focus on what should be next. The integration with Hyundai, especially given you, you’ve got some risks on Zeer, which are, you know, we have documented well in terms of driving cost down and I still don’t think, , that just because they have 3,500 cars, which again was 1500 more than I thought, or let’s say a thousand more than I thought, and it, you know, is maybe a bridge to getting to Hyundai. I still think they need to add an additional OEM, you know, for integration or, or to, to source the growth that they’re trying to accomplish. Uh, you know, with the robax fleet, I. 

Grayson Brulte: They are and they have a potential partner. This week we had an announcement out of Japan. Foxconn’s in the automotive industry, they’re gonna start manufacturing, designing and building for Mitsubishi, for the Australian and New Zealand markets. So Foxconn builds the iPhone. They can build an AV that could potentially be there. But I sit here and I think about this, if I’m Hyundai, where am I? And am I the odd man out where? Where do I sit in this whole equation? 

Walter Piecyk: I mean, to me. The, the social media posts and, and talking about the 3,500 cars is probably a reaction to the pressure that they’re feeling in the market. They know Elon’s coming, you know, in a couple of months in, in Austin, although there’s plenty of people in, in the autonomy industry that still are skeptical about what he can truly accomplish and what will actually be delivered in Austin. It’s claiming that the rides are gonna be very slow and they’re always gonna get stuck. We’ll see. There’s clearly incremental pressure on Waymo. I think that’s why they, they put out those, um, those tweets. I don’t think, you know, it means anything to Hyundai. And, and you know, what is Hyundai gonna do? All they’re gonna do is deliver their cars. And I think Waymo will wanna utilize those cars as quickly as possible. 

Grayson Brulte: Yeah. And then I also think if you look at Hyundai’s Genesis brand, do they try and revive what’s left emotional and start putting it in the, in the Genesis brands that hedge their bet, they’re going to have to, to do something. 

Walter Piecyk: The other issue for, for, for Waymo is, how many incremental cars are they gonna need, to launch new markets and to expand even to, to, , to the highways. We’ve talked a lot about the highways and seeing these. You know, these, uh, seeing some indications that highway is close. But if you think about how like San Francisco works and the number of cars you need just to serve people within San Francisco, in past podcasts I’ve talked about, well, maybe it’s just the highway to connect, you know, the island of coverage that Waymo has further down in the valley. If you do that, you risk sending a bunch of cars that will then shortchange your supply. That’s in San Francisco. I think that take I had last week or the week before was just off. And what they’re really gonna need to do before they can truly open up highways to that extent is double, triple, maybe even quadruple the amount of cars that they have in a given market. Now, there’s one exception maybe within la, you know, within the coverage area if you want to get from point A to point B quicker. Take a 40 minute trip down to 20 minute, they, they start to light up highways there or whatever that road is around by, by the Embarcadero. Maybe you open that up initially, but in terms of truly opening up highways and airports, I think it goes right back to the, the first thing, which is do they have enough cars in the market to enable that? And that might be the gating factor in terms of the highways, not whether the functionality works or not. 

Grayson Brulte: I think you’re right. ’cause then there look, all this deadhead time, all this. Downtime. If we, we have a public number now, by the end of next year, there’ll be 3,500 vehicles. I don’t see how, based on what you’re saying, you’re gonna be able to operate highways with only 3,500 vehicles unless you massively condense the markets. But if you look at all the public statements made by Sundar and the Alphabet team, there’s a lot more markets coming online this year and next year. 

Walter Piecyk: And it’s just math and, and you know, we got the update from Uber that in Austin again, something that we still believe was, was 35 cars at the launch. They’ve already ramped up to a hundred Austin. They want to get up to a couple a hundred and I think, what’s the market after Austin? Is it? 

Grayson Brulte: Atlanta. 

Walter Piecyk: Atlanta, right? Same thing that they’re gonna want to get to a couple of hundred there. And then in San Francisco and LA you’re still expanding the fleet size. If they open up San Francisco airport, maybe they can do that and still not have to quadruple or triple the size. You’re still talking about hundreds and hundreds of cars they already have, what, 2000 or so, uh, nearly Like it doesn’t leave a lot of additional cars for markets or added functionality. 

Grayson Brulte: Right now the latest number we have, the alphabet has confirmed there’s 1500 Waymo vehicles currently on the roads globally. In Austin, we know there’s a hundred and, and the statement from Dara was that they’re gonna, in the coming months, is gonna go to a hundred. So let’s say be generous, say 300 Atlanta’s 300, that’s 600 cars right there. You cannot go on the highway. Your theory is right. 

Walter Piecyk: Yeah. I mean, so we’ll, we’ll see what happens. But those are the issues that, that I think Waymo was facing. Of new markets. Let’s go back to the very first thing that you said When we got on the call, you were in DC doing some field work. Tell me about what you saw in DC 

Grayson Brulte: It’s amazing what you can learn in DC when you are wearing an autonomy shirt and you and you, and you take a child with you. Everybody wants to talk to you. So, lo and behold we’re my family. We’re out. We’re having dinner in, in Georgetown. I gotta give a shout. Oldest restaurant in DC Martin’s Tavern. Uh, really great. Lo and behold, there’s a booth, there’s a Nixon booth where we sat at and the waiter was really funny. He said, if you don’t order the meatloaf, this boot’s gonna shake. ’cause apparently that’s what President Nixon ordered. So I was a good citizen. I ordered the meatloaf and then the booth behind us is where JFK proposed to Jackie er before she came. Commonly known as Jackie Owen, eventually the first lady. So I’m looking out the window. Waymo after Waymo, after Waymo goes by Martin’s Tavern. So what do I do in doing good field work, Walter Piecyk. I grab my daughter, I grab my camera and we go Chase Waymo’s, and we, we, and so we found the Waymo there in Georgetown, and I was like, oh, is this thing broken down? The trunk was open, so I, I went up there and started talking to the gentleman. I learned everything. It’s fascinating what you can learn when you talk to safety drivers here, Walter Piecyk. I learned that the fleet size is currently five to 10 vehicles operating. Furthermore, this gentleman told me that a majority of the safety drivers do not like to drive and test. In Georgetown because of the small, tiny roads. Interesting here. Waymo is only currently testing and mapping between 5:00 PM and 11:00 PM The vehicles came from the Magna Factory, Arizona plates on them. They do not have a physical depot yet. They’re using a parking lot in Union Market. And then about four miles away up in the Brightwood neighborhood, they’re charging at a Walmart Supercenter on Electrify America, a Safeway using Ev go. So that’s what I learned. From Waymo. Very interesting. So I take that intelligence and as a good connoisseur and as a good economic development tourist, I go out to dinner and I start talking to, to individuals In the hospitality industry, Walter Piecyk is very, very bullish for this technology because they believe that it’s gonna drive the check size up ’cause it’s gonna sell more alcohol. ’cause it’s not the debate do I drive and not drink or do I take a gamble and decide if I’m gonna get a good Uber or bad Uber? Very good Intel on the ground. That’s what I learned. 

Walter Piecyk: It. It’s hard for me to believe ’cause I go to DC as you know, at least once a quarter. Our, our good friends in the capitol can drink more martinis than they already do over lunch, over cocktails, and then later, uh, later in the evening. But I’m glad to see that maybe they’ll be driving, uh, a bit more safe, uh, safely. That, that, that is, , that, that’s great. G two. Uh, so every, every one of these cars that you saw had a safety driver in ’em, presumably, right. This, they’re just doing the mapping in, in the moment. 

Grayson Brulte: I want to have a clarification on that. There are rumors going around that they’re mapping. Only I can confirm that it’s factually incorrect. They are testing and mapping, so it’s, it’s, it’s both. 

Walter Piecyk: Got it. And did you see Secretary Duffy when you were there? Did he go flying by in, in, uh, a Waymo while you were having a martini with your daughter? 

Grayson Brulte: The secretary was actually home in Wisconsin, so I did not see the secretary. 

Walter Piecyk: Well, I’ve been very impressed with, with what he’s kind of a driving force with in the worlds of satellites and air traffic controls. So I think it’s, it’s notable to pause on that for a moment because, you know, you, you learn a lot about someone, I guess in their first a hundred days, and you know, whether they’re gonna be, let’s call it a driving force or maybe a sit back. nothing. Secretary. So, you know, for a long time, podcast listeners, you know him against his aggression against our congestion pricing in New York, but he certainly wants to get stuff done, has the ear of the president why investment, you know, in this case that I’m talking about in terms air traffic control systems is good for our, our, our economy can help workers, not displace workers. So I think these are all good signs. Good early signs on what we can expect from at least that member of our government to try and drive force and autonomy. And I’m just curious if you have any refreshed thoughts on that. Having been in our nation’s capital. 

Grayson Brulte: secretary Duffy is the perfect individual to be Secretary of Transportation. He deeply cares. He’s polished. He, he is spot on delivering a message and he is extremely pro innovation and he is surrounded by a great team and de Deputy Secretary Bradbury and, and, and all the individuals that, that support them. And then soon a pending Senate confirmation. He’ll be supported by Mr. Jonathan Morrison as NHTSA administrator, a really good team of individuals that understand the positive economic benefits that autonomy will have on the US economy. 

Walter Piecyk: Why don’t we shift to, to earn the earnings calls that I had this week, both with Uber, uh, and with Lyft. You know, we already talked about the fact that they have the a hundred cars in Austin. other data point that I think got people fired up, or at least caught headlines, was referencing that, , those vehicles are now busier. 99% of all drivers in Austin in terms of completed trips per day, with hundreds of more vehicles that are planned. So, I mean, I I Why is this news, like, why is it surprising to anyone that a robot will not have to go to the bathroom and, and take a break and we’ll be there all day and not have to rest and, you know, and, and be utilized to that extent? I mean, is. Is the knowledge of what autonomy is gonna do for our, our economy and change the ride share business. That of stunted that this should have been that big of a surprise. 

Grayson Brulte: Individuals outside of autonomy, individuals that follow markets really don’t have a clear understanding of this impact. This technology is gonna have. To me, looking at this, Uber’s putting a, a stake in the ground saying we’re doubling, we’re tripling down on autonomy. That’s what this ses me. They have 18 AV partnerships to date. There’s probably more coming at the way they’re going. To me, it’s a clear indication that Uber’s doubling down and saying, we’re shifting to an autonomy first company because boy oh boy, you our mutual friend Harry Campbell, you go on The Rideshare stuff. The feedback and the outrage from drivers about that comment. Wow. It was pretty, pretty intense. 

Walter Piecyk: So, and what’s the reaction gonna be? I mean, ’cause it’s coming for you. So did you not know as a driver that this is how it’s gonna work? 

Grayson Brulte: They’re pissed at the end of the day. And if when we listen to the Lyft earnings call, we notice how richer kind of danced around the driver autonomy stuff. So does Lyft try and say, we’re the home for drivers, or Uber says, no, we’re gonna go to the future and build a big profitable business. You might have an interesting divide that’s gonna emerge in the TNC market here. 

Walter Piecyk: I think it shifting to lift. was even kind of more curious than that. ’cause there’s, you know, there’s, they have the earnings call and then there’s an additional call that they do with sell side analysts and he was asked more directly Waymo and autonomy. for a company that felt like they were close to a relationship with Waymo and something that I’ve predicted. The, the tone there changed dramatically. And now I’m a bit concerned about where Lyft is in this kind of Waymo relationship. It doesn’t seem logical that they would be kind of boxed out, , of that relationship, but the tone just felt different. So, and I’m wondering also, you know, even if, you know, there was an opportunity to do it, like Waymo is not really incentivized as we, as we spent a lot of time previously. Talking about Waymo just doesn’t have enough vehicles to add additional markets. So the opportunity to partner with Lyft on additional markets is limited, just ’cause they don’t have the cars, um, to add those additional markets. But I’m, I’m sensing that maybe there might be something deeper, , in their ability, um, to get a deal done. I, I, what, what do you think it possibly could be? 

Grayson Brulte: I’ll say it gently. I think somebody got over their skis. And Waymo didn’t like perhaps a public statement, which we’ve seen with other companies ’cause he noticed the minute that the Richer was asked the question about Waymo on the earnings call, he immediately pivoted into a long thing about Mobile Eye and how they’re the world’s best partner. 

Walter Piecyk: it was very curious. I also was surprised they got a question about, . Insurance costs and you know, the overall how to get them down. Like how do you not talk about a shift to fleets? How do you not at that point focus on flex drive and how getting fleets, whether it’s with existing human drivers, then ultimately to autonomous drivers, can reduce the cost of your insurance. And then ultimately, obviously with autonomy, you know, with your labor costs. It just, it seemed like a lost opportunity and frankly. Getting back to my, you know, frustration with listening to other analysts. Question, make questions in the call. I went through two calls. No one asked about Flex Drive. Flex Drive might be one of those ways that Lyft can, you know, establish a closer relationship with Waymo. Why shouldn’t Flex Drive be, you know, one of the new market, , ba you know, service component of what Waymo is, is trying to accomplish? And, and that’d be your way to tighten those relationships. Odd that it wasn’t. , It asked on the call, but again, you know, you know my frustration with the, the types of questions that get asked on these calls. 

Grayson Brulte: I feel the majority of the analysts outside yourself have no idea a true sense of what the autonomy markets are. They go on Bloomberg and they go on CNBC and and ran and rave about, you call it their book, and they don’t really have a clear understanding. Of the industry ’cause the flex drive thing’s important. ’cause in Austin and Atlanta, AV ammo, I’m gonna spell it. Av, OMO, that’s who’s managing the Waymo fleet for Uber. Uber, Uber’s a partner with them. And then in Miami with the Waymo one, it’s gonna be move and other markets it’ll be move. And you, Lyft, you sit here at Flex Drive’s a holy subsidiary. You should start asking questions. Are you gonna ramp this up? Are you gonna let other non lift people use it? You, you need to get answers on that. 

Walter Piecyk: Absolutely. Let me, let’s, let’s switch back to Uber for a a second as well. Off of earnings, put a hundred million. The company put a hundred million Uber, put a hundred million dollars into Weide. We’ve talked to ’em about, we ride on this podcast before and, and some of the questions that I had about. they’re using remote drivers in China and what that ratio is of drivers, um, drivers to actually autonomy autonomous. We ride cars in China. had some, had some opportunity to, to have a discussion with pony ai. very bullish about themselves. Love their competitive, view towards the competition, whether that be we Ride or Tesla or others. But Uber sticks another a hundred million dollars into We Ride. And I think, look, you look at it none of us really know which one is gonna be the true winner here. So I think Uber is, it’s like a, I don’t wanna say spray and prey, but it’s like, okay, develop, use money to make sure that this fragmentation develop relationships with those companies before other companies can. Maybe that’s helping. Uber have a better relationship, frankly, with Waymo than Lyft is able to. So maybe continue to do that with other autonomous options out there. And I guess that that’ll continue and I don’t think this, this, you know, would have any negative impact on their ability to continue to partner with Pony as well. 

Grayson Brulte: So they have the relationship they announced with pony, but to me this is Uber being strategic. They see what’s coming. Chinese AV companies are moving into Europe. So Uber says, why don’t we be the platform to do that before they build up their own platforms? I gave Uber a lot of credit for that, didn’t he? On the earnings call, did you hear Dara was, he must be listening to autonomy markets? Well, he started talking about REITs, the, these fleet owners emerging and putting more capacity onto the Uber network. Now that gets interesting as well. 

Walter Piecyk: Yeah. Fleets have, have, as we’ve talked about on many of these episodes, an important. Part of the, or a important component of strategy, again, to lower some of those insurance costs, gets more reliability in the cars, and, and kind of understand where the future is. Prepare for what the future is, which is autonomy, right? The future is bright, the future is autonomy. Isn’t that what we say? But again, let’s go back to patting you on the back, Grayson, because 15 more cities after Abu Dhabi. I think you’re right. That’s Europe. And this goes back to. Again predicting about, you know, these Chinese companies developing in Europe. You were very early on that noting they were starting up operations there. Um, and we see now a string of a string of announcements that indicating they’re going down that path. 

Grayson Brulte: Thank you for that. The earliest sign was when we had an MOU between Luxembourg and Pony ai, and then later it was followed on with a research grant, so Europe’s paying them to come in. This is not about moving Cheese Belt and Road, which I’m now calling the autonomous Belt and Road. It’s going way down that, so now that the Chinese have a, have a, a foothold in Europe, Lyft acquired free now, hasn’t closed yet, but they acquired free. Now, does Lyft try and deploy that playbook in Europe and try and take some of the Chinese economy put on the network in Europe as well? 

Walter Piecyk: I think it’s possible, and I think, you know, to the extent that things aren’t moving forward between Lyft and Waymo, they need to be even more aggressive. Granted, they don’t have the type of capital that Uber has to throw around. But more aggressive in adding more and more partnerships, um, on the autonomy front, beyond, you know, what they’ve already done. Uh, I think we’re probably most excited with what may mobility and, and what they’re doing there. And Uber’s already in there with, with May mobility as, as a, as a close second, um, in terms of timing. 

Grayson Brulte: May has the relationship both with Uber and Lyft, one of the only ones that has, if you wanna call it dual dual citizenship, dual platform residency. We can use those terms there. The the thing I’m gonna be watching for as the Uber VW relationships. Matures and if they do launch, that’s a big question in 2027 in la, do we eventually say 29, 28, see something in Germany to try and counteract this Chinese? That’s gonna be a really interesting move that we need to watch there. 

Walter Piecyk: That is so far out. Grayson 20, nines 2029 is what we’re talking about now. I’m focused on the near term stuff and you know what, what we can get done in, in 25 and 26. 

Grayson Brulte: I’m always focused on the near term, but I’m, I’m also looking to the future, not, not trying to get ahead of my skis here. Jesse Levinson, the co-founder and CTO of Zoox, an interview at the Financial Times where he spoke about Zoox ramping up and scaling up production of the Zoox Toaster Mobile. Why ramp up production now and your vehicle just got recalled for getting into a crash? And you have not even launched a commercial service yet. And furthermore, there’s no regulatory certainty that you can even launch the toaster with paid commercial service. 

Walter Piecyk: I mean, I think there’s more questions about Zoox beyond that. Wasn’t there some additional news that we’ve learned about what happened maybe a couple of months ago? 

Grayson Brulte: Yeah, there was the crash in in Vegas, the unoccupied crash. So that’s the issue. 270 vehicles got recalled with a software update, but we still don’t have any insight into what caused that. 

Walter Piecyk: which recall was that? 

Grayson Brulte: That was the April 8th one where they had the crash in Las Vegas where they had to recall 270 the Robax with the software update. And before that, they had the hard braking incident. Recall with a Highlander, it doesn’t seem, this is your second, actually your third recall, if you include the glass, it doesn’t seem these vehicles are ready for prime time and yet this is the Financial Times reporting. They are going to manufacture these vehicles themself. They’re not gonna use a Magna. I still don’t get what’s going on 

Walter Piecyk: I mean, I say, I guess my question to you is this, Grayson, I think what we know is that there’s a relatively limited area that Zoox operates in within San Francisco. Is that because in your view of the technology or is it the availability of cars? 

Grayson Brulte: both. Now, I want a caveat saying. Five years ago when Tim Kenley Clay was still there, they put me in one of the original Highlander prototypes in San Francisco where they were the first time where they were able to make an an unprotected left hand turn, and the vehicles were working good. I don’t feel that their technology’s progressing as fast as it is when they, since they fired Tim. 

Walter Piecyk: I mean, I don’t think it can be both. I, I think, I mean, yes, I understand that it’s both. They don’t have either, but if they had the supply, the technology’s not necessarily good enough to expand geographically. the first issue you have to do is to get the technology driver out good enough where it can operate more broadly, throughout San Francisco, Las Vegas, wherever you wanna pick to do that. , In addition to the volumes beyond that, like Uber and Waymo launched with 35 cars at this point in the company’s history and with the financial resources that Amazon has. You’re telling me they can’t bandaid together 35 cars to get their first market off the ground and show people in the industry some progress like that’s scaling to get to 35 cars to scale in a market to launch service, and I don’t understand what is going on at that company. 

Grayson Brulte: I don’t either. And going back to annulus. Elliot Row. Not one analyst in the last several quarters has ever asked a single question about Zoox 

Walter Piecyk: I get that Amazon’s a, a larger company. This is a much smaller, um, part of it, you know, it’s not Waymo, even Waymo relative to the size of Google. And relative to the problems that Google has on search, which by the way, were further underscored this week when, eddie Q, you know, talked about search numbers going down. , You know, month over month. It’s a company with challenges, at least this is a big thing. Zoox is just, I mean, I think the fact that no one’s asking about it tells you everything you need to know about Zoox. There’s nothing to necessarily talk about. 

Grayson Brulte: No. What we want to talk about is a launch. We’re going into the summer here. Well, let’s play a Parlo game. Yes or no? Does Zoo’s launch commercial service by Labor Day? 

Walter Piecyk: no, sorry. Sorry. I mean, if I would, I wanna be a believer. I love Amazon as a, as a company, um, and a lot of the different things that they do, but I’ve just lost a lot of confidence in, you know, where that company is in the, where Zoox is in their progress. So something’s gotta give man one way or another there. 

Grayson Brulte: something definitely has to give. Because Zoox needs to to show the market progress. A company that’s surprisingly showing the market progress, which we have not spoke about or covered here, is Rivian Walter Piecyk. They’re getting ready for an autonomy AI day in the fall. And I wanna quote something that that founder and c RJ here said on their Q1 2025 earnings call here for you. And I’m gonna quote him here in quote. One of our most critical technology focus areas, which customers will start to see the output of is a rivian autonomy platform. With the launch of our second generation platform, we entirely changed the perception stack and compute. Our R one vehicles now have 55 megapixels of cameras and more than 200 tops of onboard inter interference. What do you make of that? Seems like they’re going. 

Walter Piecyk: What I make of this is when topics become popular and management teams and boards get asked about them, they all of a sudden appear, on conference calls. And this just underscores, the pressure that OEMs face in terms of autonomy. I. also underscores stuff that Elon has said, which is that autonomy is, can be a deciding factor on why people will buy, the Teslas going forward. Like it wouldn’t be appearing on the conference call. They wouldn’t be highlighting that, Hey, we’ve got a game plan on this if it didn’t matter to consumers. So I think autonomy is gonna matter in the purchase decision of your cars. Now with that said. This is probably a a s right, that Rivian iss doing this is not true autonomy. And then we have to start questioning Rivian Rivian, which I don’t know much about so I might have this wrong. But are they, are they developing this stuff internally as opposed to partnering with a company that has, is focused on the technology stack of autonomy? What’s the story here? 

Grayson Brulte: They are developing in a house. Originally it started as an an A DAS stack. Now they’re, they’re hinting to the market. We’ll get more in the fall of the AI and autonomy day that they’re gonna build a full stack, but we don’t have any clarity on that yet. 

Walter Piecyk: I mean, I think there’s a big difference between a DAS and full autonomy. I know Wave likes to talk about, you know, how you, they’re gonna go from this, from this A DAS and the perception stack and full AI and, and all this stuff in terms of full autonomy. But. It feels like already have enough issues as it is creating You’re gonna add additional complexity and hard things, which you’ve got a bunch of companies on, as opposed to just partnering separately. It, it, it almost feels like trying to do a media strategy and have people and developing stuff on their own rather than partnering with someone that is an expert in the field. 

Grayson Brulte: they don’t have the cash to, to build a true autonomy program. Let’s just get down to brass tax. They don’t have it. They don’t sell enough vehicles. They don’t have the cash flow to do it. And they’re not exactly a small company. They’re not exactly an an early company. To me, it makes more sense to go out with a neural or wave and license their stack and try and really accelerate this because over time, autonomy will become a defining factor for consumer purchase. Which raises the question, what the heck is GM Ford de Landis gonna do? They all shut down their programs. They have nothing. 

Walter Piecyk: Yeah, that is a great question. But, you know, sometimes you shut things down and then you, and then you reignite them. So it’s clearly not impacting purchase decisions today. Uh, but those things can change very quickly. 

Grayson Brulte: Markets change quickly. They change on the dime, or they change by the second, depending on how fast your your fiber pipe is. Well, what do we need to look for in the autonomy markets over the coming week? Anything on your radar? 

Walter Piecyk: Finding out where Sterling Anderson is gonna go, that’s the number one thing on my radar. I’m also, um, thankfully gonna be spending time with some of, some of the team from Bot Auto, with Don Burnett of, of Kodiak. We have a lot of conferences, , next week where Uber and others will be speaking. Sometimes you get more information that kind of comes out of that when they’ve got a longer form to discuss, you know, what’s going on in their autonomy world. So yeah, it should be, I think another busy week. Grayson. 

Grayson Brulte: Will be a busy week. The kids like to play with the Where’s Waldo Books and the Autonomy Economy and the Autonomy Markets. We’re playing a game over the coming week. Where’s Sterling? The future’s bright. The future’s autonomous. The future is asking questions, Walt, Until next week.