Tesla vs Alphabet: When two quarrel over autonomous vehicles, the third rejoices

“I just used a Waymo because you told me so. It was the most comfortable cab ride ever, smooth, no robotic feeling, quiet and relaxing”

– Tim, an arvy app user since day one, responds to our in-app update on the robotaxi race

arvy’s teaser: The robotaxi race is real — Tesla and Alphabet are going head-to-head. But while the two giants quarrel over hardware and code, the third, Uber, rejoices and builds the platform that will win either way.

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AVs.

Or Autonomous Vehicles.

What once sounded like science fiction is now just around the corner.

As so often, the US is front and center in this technological revolution. In cities like San Francisco and Austin, driverless vehicles are already a daily reality — quietly shuttling passengers around like it’s no big deal. What was laughed off for years… is now very real.

Many tried to get in the game. Many failed. Some never had the tech chops to begin with.

But now, suddenly, we’ve hit an exponential curve — where sci-fi turns into reality faster than most can keep up with. Case in point: Waymo — one of the pioneers — is already completing 250,000 (!) rides per week in the US. Tesla officially launched a limited robotaxi ride-hailing service on June 22 in Austin, Texas. And others like Volkswagen (ID. Buzz AD) and Amazon (Zoox) are waiting in the wings, prepping their own self-driving fleets. A new business model is emerging right before our eyes: Transportation-as-a-Service.

So let’s zoom in. For now (chart 1), we’ve got Alphabet’s Waymo, Tesla’s Robotaxi, and then — the dark horse: Uber.

The latter might just be the laughing third in this next-gen transport showdown.

But let’s start step by step.

Chart 1: Alphabet’s $200K Waymo vs. Tesla’s $37K Robotaxi

Source: X

Alphabet’s Waymo is still Leading the Pack

So yes, robotaxis are real and rolling.

Waymo, owned by Alphabet, leads the pack, operating driverless rides in San Francisco, Phoenix, Los Angeles, and Austin since 2017, with 250,000 weekly trips and 10 million paid rides total (chart 2). Its fleet of 1,500 Jaguar I-Pace vehicles is expanding slowly due to high costs.

We’ve all seen the Waymo cars cruising around in places like San Francisco or Austin. No driver, no wheel turns by human hand. And yet, everything runs smoothly – as confirmed by our arvy community (kudos to Tim 😉).

But how exactly does this work? And why does this car cost upwards of $200,000?

Let’s break it down.

Waymo relies on a hardware-heavy approach. Each vehicle is stacked with 29 cameras, 5 LiDAR sensors (a method that uses light in the form of a pulsed laser to measure ranges), and 6 radars, all working in harmony with ultra-precise GPS and pre-mapped, 3D-rendered routes

The result?

A car that doesn’t just “see” the road — it knows it. It operates like it’s reading a real-world blueprint. That level of precision doesn’t come cheap.

But what you get in return is safety. Real safety.

Waymo’s performance in Austin shows just how good the tech has become: its autonomous vehicles are now busier than 99% of taxi drivers. Yes, 99%. That’s efficiency on steroids. And when it comes to safety, the data is beginning to speak — and it’s loud. Fewer accidents, smoother rides, and a system that doesn’t get distracted, drowsy, or reckless.

In numbers?

Compared to an average human driver over the same distance in their operating cities, the Waymo driver had 88% fewer serious injuries or worse crashes.

This isn’t just hype. It’s happening.

Still, a quick note for investors: Waymo is not a pure-play AV company. It’s a small, loss-making unit within Alphabet — exciting, yes, but only a piece of a much larger puzzle.

Alphabet’s Waymo is currently the gold standard in robotaxi safety and operational readiness. Its method is complex and expensive — but it works. While other players try to cut costs with vision-only systems (Tesla), Waymo is building a fortress of safety and reliability.

And here’s the thing: In a world where trust is the number 1 currency, safe autonomy wins. And right now? That crown goes to Waymo.

Now let’s flip the script — and go light, lean, and fast.

Chart 2: Waymo Shows No Signs Of Slowing Down – on the rise in California

Source: Visual Capitalist

Tesla’s Robotaxi Comes With Full Force

Enter Tesla.

Unlike Waymo’s sensor-packed spaceship on wheels, Tesla took a radically different approach: 9 cameras, no LiDAR, no radar, and a whole lot of AI.

It’s what Elon calls “vision-only autonomy.”

So how does it work?

Tesla’s system is built entirely on Computer Vision powered by neural networks. Think of it like how a human sees: eyes (cameras) and a brain (AI). No detailed maps, no external crutches — just a system that learns to drive by seeing and reacting in real time.

The result?

In theory, it can drive anywhere, without needing pre-mapped environments. One model to rule them all.

And now, price. A Tesla Robotaxi?

$37,490.

That’s more than 80% cheaper than Waymo’s $200,000+ lidar-loaded ride. And it’s for sale — Tesla’s aiming for mass deployment, where you could own a Robotaxi and earn money by renting it out.

So yes, this is no joke.

You drive your Tesla to work. Park it. While you’re at your desk, it’s out picking up riders. Earning money. On autopilot. By 6 PM? It’s back, ready to take you home. That’s Tesla’s vision (still in the pilot phase, of course): your car becomes a side hustle. No longer a parked asset — now a passive income machine.

And yes, it’s closer than you think.

But here’s the tradeoff.

Tesla’s system is still learning. It’s fast, flexible — but not flawless. Edge cases like fog, glare, or construction zones still trip it up. Without LiDAR or pre-mapping, the car must rely on AI alone — and it’s not 100% there yet. Safety? Critics say it still trails more cautious systems like Waymo.

And investors?

Buckle up.

You’re paying a lofty PE of 160 (chart 3), and you’ll need to endure the daily “war of opinions” between die-hard fans and skeptics — plus the occasional Elon tweet storm that can move markets.

Still, if Tesla nails this? They don’t just join the race — they rewrite the rules.

Cheap, scalable, human-like autonomy. That’s not just innovation. That’s revolution.

But what if the real winner isn’t building the car…

…it’s the one sending the ride?

Chart 3: Tesla’s valuation (PE)

Source: Koyfin

When Two Quarrel, the Third Rejoices

While Tesla and Waymo battle it out over whose robotaxi reigns supreme, Uber might be the real winner here.

Why?

Because it doesn’t need to build the cars — it just builds the network.

Uber, operating in a $58B ride-hailing market set to hit $330B by 2030, plays the game smart: asset-light, platform-first and high margin (net income margin stands at 27% (!)). It’s already partnered with Waymo, letting users in Austin and Phoenix hail driverless rides right through the Uber app — earning up to 30% per ride.

Just this week, Uber announced a multi-year partnership with the Chinese company Baidu. Volkswagen’s AVs are next. A Tesla integration could follow.

Meanwhile, Uber boasts 171 million users and 1.2 billion (!) app downloads — a scale that neither Waymo (2 million app downloads) nor Tesla (21 million) can match yet. And without passengers, robotaxis become expensive parking lots on wheels. In the robotaxi race, network matters.

Yes, Tesla’s potential $1.10/mile fares could undercut Uber’s $2 average — a risk. But, at arvy, we believe, more robotaxis = more supply = lower costs = more rides overall. That’s a win. The flywheel effect sends its regards.

So, while Waymo and Tesla duel over tech, Uber sits in the middle lane, collecting tolls. Like the proverb goes: If two quarrel, the third rejoices.

And in the robotaxi gold rush, Uber might just be the one selling the shovels.

Chart 4: Tesla, Alphabet and Uber over the last five years

Source: TradingView