Waymo CEO Says Alphabet Unit Plans to Launch Driverless Car Service in Coming Months

By Douglas MacMillan and Tim Higgins

LAGUNA BEACH, Calif. -- The head of Alphabet Inc.'s Waymo unit said it plans to launch its first commercial self-driving car service in the next two months and expects businesses to be among its biggest customers.

Speaking at The Wall Street Journal's WSJ Tech D.Live conference on Tuesday, Waymo's John Krafcik said the new service will charge individual passengers for rides as well as businesses, such as Walmart Inc., who want to pay to shuttle their customers to stores. The service will initially be available to a small group of riders in the Phoenix area, but will expand to more people in the coming months, he said.

Waymo has said it plans to launch a self-driving ride service in 2018 and earlier this year announced deals to buy thousands of vehicles in coming years from Fiat Chrysler Automobiles NV and Tata Motors Inc.'s Jaguar Land Rover to expand its fleet.

The tech unit, which began as a self-driving car project under Google, has spent years and driven millions of miles to develop the technology. Last year, Waymo began testing its self-driving vans with nonemployees in Chandler, Ariz., through its so-called Early Rider program to learn how potential customers might use and interact with the service.

On Tuesday, Mr. Krafcik said one surprising part of this pilot has been the number of businesses including Walmart, Avis Budget Group Inc. and AutoNation Inc. who are willing to pay for their customers' rides.

"This is a whole other channel of demand we really hadn't thought deeply about that could end up being a really significant driver of business," he said.

Alphabet CFO Ruth Porat told analysts last month that Waymo began testing price models during the third quarter through the Early Rider program. "We moved into very early days of commercialization," she said.

Other tech companies and auto makers are rushing to develop similar technology and deploy robot taxis in a bet that the technology will reshape the landscape for personal transportation. General Motors Co.'s Cruise unit is testing a fleet of vehicles in San Francisco and has said it plans to launch a service somewhere next year. Meanwhile, federal, state and local regulators are grappling to oversee the fast-developing technology to ensure safety. A fatal crash earlier this year involving a test vehicle operated by Uber Technologies Inc. raised new questions about whether the technology is ready for deployment.

Mr. Krafcik also highlighted the progress of Waymo's commercial trucking business, which has begun delivering freight in Atlanta. In commercial trucking, "you could anticipate a material contribution to the world from Waymo over the next couple years," he said.

Write to Douglas MacMillan at douglas.macmillan@wsj.com and Tim Higgins at Tim.Higgins@WSJ.com

(END) Dow Jones Newswires

November 13, 2018 14:10 ET (19:10 GMT)

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