By Jiahui Huang

The robotaxi race is on.

The top contenders: a company backed by Google parent Alphabet, and the autonomous-driving arm of Chinese tech giant Baidu.

Soon, they will face off in London--the first place where a Chinese robotaxi will compete directly against a U.S. rival.

Waymo, Alphabet's self-driving car company, has partnered Uber-backed ride-hailing company Moove to enter the U.K. market next year. ApolloGo, the robotaxi venture developed by Baidu, is teaming up with ride-hailing company Lyft.

Competing in the same circuit will give markets the chance to gauge the companies' technology, user experience and safety credentials.

Whoever takes the lead in London may get a head start rolling out robotaxis elsewhere. Doing that will let them grow their fleets to the scale needed to turn profitable sooner.

Analysts say the outcome could be a photo finish.

Chinese robotaxi companies have an edge in operating in complex road scenarios and cheaper production costs. U.S. firms can build brand awareness more easily and are stronger on the data security front.

The key difference between Waymo and Baidu's ApolloGo will likely be their hardware stacks, said Eugene Hsiao, head of China equity strategy and China autos at Macquarie Capital.

Thanks to China's mature automotive supply chain, robotaxi makers there that use local components typically have a large cost advantage versus competitors overseas, he added.

Chinese robotaxi makers also have more experience managing complex driving scenarios due to extensive road testing in China, said Ming Lee, BofA Global Research's head of Greater China auto and industrial research. Vehicles and autonomous driving systems are also cheaper there, the analyst added.

That said, convincing consumers to use robotaxis may be even more important for success than cost and pricing. For that, companies will need to deliver on user experience and build brand loyalty.

"We believe Waymo's ample experience operating in major U.S. cities may give it an edge [in user experience] compared to Baidu which is primarily scaled up in China," Hsiao said.

For Chinese companies, the challenge is building brand awareness and consumers' trust in Europe, Lee added. They may face concerns over data security and are less well-known in the U.K. market compared with American companies, Lee said.

Overcoming these challenges could pay off big for the loss-making robotaxi companies. Given the tensions between the U.S. and China, Europe has become a critical market for the industry.

"The potential profitability of operating robotaxi services in Europe could be greater than in the Middle East or China, largely due to higher fare rates," said Lee at BofA Global Research. European taxi fare rates tend to be higher than in the Middle East or China.

Europe's aging population supports the automation of services, said Macquarie Capital's Hsiao. He added that "robotaxis have a much higher value proposition in high-wage developed markets as a direct labor substitute for drivers."

Both Baidu and Waymo are confident of winning pole position in Europe.

"This is a trillion-dollar market, and we have always held the view that healthy competition benefits the industry," said Baidu's managing director of EMEA, Liang Zhang.

"Our confidence stems from our strong safety record, market-tested operational expertise and experience in both left-hand drive and right-hand drive markets, a combined experience that many companies lack," Zhang said.

A spokesperson for Waymo said the company has over 100 million fully autonomous miles under its belt, operating hundreds of thousands of fully autonomous trips every week.

"That experience has prepared us well for operating a service in London and other large cities around the world," the spokesperson said.

Write to Jiahui Huang at jiahui.huang@wsj.com

(END) Dow Jones Newswires

November 17, 2025 03:00 ET (08:00 GMT)

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