Alphabet’s GOOGL self-driving unit, Waymo, is leaving no stone unturned to bolster presence in the autonomous driving space.
In fact, speculations are rife that the company’s driverless semi-truck was allegedly spotted on the roads of Sunnyvale, CA, taking a test ride.
Notably, Waymo in collaboration with Google launched its pilot program for autonomous trucks in the beginning of this year with the intention of providing freight services to the latter.
The latest move of the company gives a glimpse into the execution of its self-driving truck project.
Growing Self-Driving Initiative
Per a report from Grand View Research, the self-driving cars and trucks market is projected to hit 6.7K units in 2020. Further, it is expected to witness a CAGR of 63.1% between 2020 and 2030 in order to reach 4,223K units by 2030.
Alphabet is currently riding on its growing initiatives in this particular market which are likely to aid it in rapidly penetrating this space.
With autonomous truck services, the company intends to explore the opportunities beyond ride hailing services on the back of its robust self-driving technology and artificial intelligence techniques. In truck and freight industry, a driver cost accounts for a large part of the total cost.
Consequently, Waymo autonomous trucks are likely to benefit the industry by cutting down the driver cost.
Recently, Waymo unveiled its first paid self-driving taxi Waymo One in Arizona, putting an end to its long-awaited quest for driverless car services.The latest taxi service of the company will serve the people of Phoenix suburbs namely Chandler, Tempe, Mesa and Gilbert.
Furthermore, the company’s efforts toward licensing its technology to automakers for direct selling to customers remains a key catalyst.
In terms of expansion, the company has already placed an order for 62K cars from Fiat Chrysler and is eyeing the European driverless vehicle market.
All these strong endeavours will continue to provide Alphabet a competitive edge against the other tech companies like Apple AAPL, Amazon AMZN and Baidu BIDU which are also firing on all cylinders to reap benefits from this high potential market.
Alphabet Inc. Revenue (TTM)
Alphabet Inc. Revenue (TTM) | Alphabet Inc. Quote
Despite the allure and benefits of self-driving technology and vehicles, some inevitable challenges prevail in the market. The foremost problem plaguing this technology is the chance of mishaps on road.
Further, on the launch of Waymo One, it was observed that the car were slow at times even in favorable road conditions. These challenges might affect the success rate of Waymo project.
However, in order to avoid any emergency or untoward incident on road, the company has kept human drivers in the car for safety. This will aid the company in countering the major challenge related to self driving.
Further, the company’s strong focus toward innovation will aid it in removing technical hurdles as well.
Currently, Alphabet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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