UBS: Waymo can profit from commercial self-driving in four key areas

At long last, Waymo officially launched its commercial self-driving taxi program this week.

Waymo One, a subsidiary of Alphabet, is the first commercial autonomous ride-hailing service in the United States and will initially service the company’s 400-person early rider program in the Phoenix, Arizona area, with plans to expand beyond the city.

The rides will still have a human safety driver behind the wheel to mitigate any problems, but Wall Street is nonetheless very excited about the new potential revenue stream for Waymo.

UBS’ analyst Eric Sheridan says Waymo’s business opportunities fall into four main categories:

“We believe the four revenue pools they could look to monetize include: 1) maps; 2) AV operating system (OS); 3) robotaxi service; and 4) monetization of rider time spent in-car,” Sheridan said.

Together, he estimates the four businesses could bring in $114 billion in revenue for Waymo by 2030.

These revenue figures translate to an enterprise value of anywhere between $25 billion and $135 billion, UBS estimated in May, and could make up more than a tenth of Alphabet’s total market value.

Read more: Waymo has launched its commercial self-driving service in Phoenix — and it’s called ‘Waymo One’

“After conducting 22 industry expert interviews and forecasting the landscape, we see Waymo as the early leader (by a solid margin) in the emerging field of autonomous driving,” Sheridan said.

So far, the company has racked up more self-driving miles than any other competitor — and there are plenty — with more than 10 million miles now under its belt.

It could still be a while before you ride in a self-driving taxi, unfortunately, but one could deliver your packages even sooner.

“Some industry experts believe autonomous driving technology has potential to get to market faster at scale for commercial logistics than consumer ridesharing,” said Sheridan. “This is given the relatively less sensitivity around ride quality, ETAs, infrastructure complexity.”

Ford, for example, is already testing driverless pizza delivery with Domino’s in some markets. Kroger is also testing grocery delivery with the company Nuro in Arizona.