Waymo and Via Struck Robo-Taxi Deal. Tesla Is Falling Behind.

A Waymo autonomous self-driving Jaguar electric vehicle in the Phoenix suburb of Tempe. (Charly Triballeau / AFP / Getty Images)

Key Points

About This Summary

• Waymo partnered with Via Transportation, following the expansion of its Lyft partnership to Nashville next year.
• Via’s software will integrate Waymo’s self-driving service into public transit, starting in Chandler, Arizona.
• Waymo is ahead of Tesla in robo-taxis, operating in multiple cities with plans for expansion, completing 250,000 rides weekly.

Alphabet’s Waymo is charging ahead with robo-taxis, teaming up Thursday with a new partner, Via Transportation. The deal keeps Tesla in the unenviable position of playing catch-up with its self-driving taxi service.

Waymo’s deal with Via, which went public Sept. 11 at $46 a share, came a day after Lyft and Waymo said they were expanding their fully autonomous ride-hailing partnership to Nashville next year. Lyft stock rose 13.1% on Wednesday, after the news.

Via’s software platform allows public transit operators to design and operate their networks through a single cloud-based interface, helping improve efficiency. Now, operators can use Via products to introduce Waymo’s self-driving ride-hailing service into their networks.

Chandler, Arizona, will be the first location to use Via to integrate Waymo into its so-called microtransit service.

Via shares traded as high as $52.52, before sliding to $48.16, down 3.7% on Thursday, giving the company a market value of about $3.7 billion based on about 77 million shares outstanding after the stock offering.

Alphabet stock rose 1% to $252.03, while the S&P 500 and Dow Jones Industrial Average added 0.5% and 0.3%, respectively.

The Lyft deal grabbed the attention of Canaccord analyst George Gianarikas. “The autonomomentum continues,” wrote Gianarikas, mashing up autonomous and momentum. “We applaud Lyft’s efforts in transforming into a cyborg of sorts. It’s a strategic imperative: embrace the technology before it has the potential to displace you.”

Gianarikas took his Lyft stock price target to $18 from $11, but kept his Hold rating. He isn’t sure, though, if the expansion of self-driving cars will benefit Uber Technologies and Lyft as much as Tesla and Waymo.

Overall, 27% of analysts covering Lyft stock rate shares Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target is about $18 a share. Almost 80% of analysts covering Uber rate shares Buy. The average price target is about $108 a share.

In June, Tesla launched its self-driving taxi service in Austin, Texas. In July, CEO Elon Musk said he hoped Tesla robo-taxis would be serving half the U.S. population by year’s end. Tesla is still only serving Austin.

Waymo’s autonomous taxis operate in San Francisco, Phoenix, Los Angeles, Austin, and Atlanta through Uber. It completes more than 250,000 rides each week. The company plans to add Miami next year and is testing in New York and Las Vegas.

For now, Waymo has the lead on Tesla. But Tesla has manufacturing capacity. Waymo buys its cars. Tesla can make millions of electric vehicles a year.

The EV pioneer plans to build a robo-taxi called Cybercab next year. But almost every Tesla has the potential to be a robo-taxi because it installs optical cameras on every new built—the eyes for its self-driving machines.

The standard feature of optical cameras is something Tesla plans to leverage by creating an Airbnb-type service—Tesla owners offering their cars in a ride-hailing network. Waymo incorporates more expensive sensors with cameras, including lidar, which is essentially laser-based radar.

How the self-driving wars will turn out is hard to say.

What’s certain is that many players, including Lyft and Waymo, want to position themselves as winners as technology evolves.

Write to Al Root at allen.root@dowjones.com