The stock of Tesla (TSLA -5.73%) has been on a bit of a winning streak. Shares have soared by more than 15% in just the last week. That streak looks to be coming to an end today, though.

Tesla stock was trading down 4.5% as of 11:40 a.m. ET on Wednesday, declining by over 7% at the morning low. The reason for the drop is expanding competition in the self-driving vehicle sector. A recent announcement could mean that Alphabet's Waymo and Toyota may soon be taking a bite out of Tesla's growth plans.

Who's the real full self-driving leader?

It's no secret that Tesla investors are counting on its self-driving technology for future revenue and profit growth. CEO Elon Musk himself famously said people shouldn't own his company's stock if they don't believe it will solve the problems with autonomous driving.

Yet competitors already have self-driving vehicles on the road earning revenue as robotaxis while Tesla does not. It has millions of privately owned electric cars in daily use feeding data back to the company, though, and that could ultimately be its big advantage.

Waymo now says it is providing 250,000 driverless taxi rides a week in the cities where it operates. But Waymo's vehicles could be prohibitively expensive compared to Tesla's consumer lineup and eventual robotaxi model. That could mean Tesla will be the one to generate massive profits in the future.

A rendering of the sixth-generation Waymo Driver on Hyundai's all-electric Ioniq 5 SUV. Image source: Waymo.

Waymo may have solved its biggest obstacle

Today's announcement that Waymo is partnering with Toyota for work on self-driving cars could be a game changer, though. The companies have agreed to collaborate on developing and deploying the technology. The aim, the partners said, is "to leverage Waymo's autonomous technology and Toyota's vehicle expertise to enhance next-generation personally owned vehicles."

Waymo is currently operating its driverless vehicles in four U.S. cities. Now, it may have a future partner in Toyota to help it build lower-cost vehicles. Tesla may be losing ground to its biggest competitor in the space, triggering some investors to sell the stock today.