By Denny Jacob

Tesla's robotaxi ambitions are a threat to both Alphabet Inc.'s Waymo and Uber Technologies, and the next year will be critical in determining Waymo's leadership in the space, according to Wedbush analyst Dan Ives.

"I think this is the key 12 months ahead because, a year from now, we expect Tesla robotaxis to be in 20 to 25 cities," Ives said. "Waymo today is in five cities. So even though they have a huge lead, they're expensive cars and it's hard to deploy."

Tesla in late June rolled out its robotaxi service in Austin, Texas, to a limited number of customers. Chief Executive Elon Musk has said the company will start small, with as many as 20 Tesla Model Ys driving on public roads, before expanding the service based on the technology's performance.

Waymo, the driverless-taxi company owned by Google's parent company, is widely considered the frontrunner among robotaxis given its years-long headstart. But holding that lead may boil down to partnerships such as the one it has currently with ride-hailing company Uber, given Tesla's advantages in scale and lower technology costs, Ives said.

Tesla isn't without potential speed bumps. Musk oversees a number of companies and has a mixed perception among some consumers. But his current feud with President Trump poses a significant risk, particularly as it relates to the regulatory environment, Ives said.

Ives ultimately predicts Tesla will have a majority of the market share for robotaxis and autonomous vehicles, but sees Waymo retaining a portion of what he estimates to be a $800 billion market. But partnerships such as the one with Uber and how they are designed to go against Tesla will determine Waymo's future.

"For Waymo, the name of the game is about latching on to Uber and then joining forces more and more strongly," Ives said. "Because to some extent Waymo needs Uber, Uber needs Waymo."

Write to Denny Jacob at denny.jacob@wsj.com

(END) Dow Jones Newswires

July 01, 2025 14:29 ET (18:29 GMT)

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