Robotaxis in San Francisco Can Now Operate 24/7 — Not Everyone Is Happy About It

Key Takeaways

• Two companies, Googles Waymo and General Motors’ Cruise, got approved to operate robotaxis 24/7 in San Francisco
• City residents argued in favor of and against the decision during a six-hour hearing
• The decision represents a significant shift in the driverless vehicle space

Driverless cars are about to become a much more common sight in San Francisco. Two robotaxi companies, Waymo and Cruise, just got approval to run their robotaxi services 24/7 in the city.

This is a huge win for those companies and a notable expansion of driverless car operations, though some residents and activists voiced opposition to the move. We’ll get into the pros, cons, and stock implications of it all below.

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What’s happening with the robotaxis

Prior to this decision, Waymo and Cruise operated on a limited basis. Following this vote by the The California Public Utilities Commission (CPUC) they can now operate throughout San Francisco at any time of day or night and charge for rides.

The approval came with a little bit of a warning following complaints about the taxis causing traffic issues and getting in the way of emergency vehicles. If those complaints continue, the CPUC might reverse its decision or enforce limitations.

City residents who opposed the decision used to the hearing to voice concerns over big tech not having the best interest of the city at heart, surveillance concerns, loss of jobs, and worsening San Francsico’s traffic situation. Those in favor expressed excitement over more transportation options — particularly for folks with disabilities — and safety innovation.

Ultimately, CPUC determined that the companies have met the regulatory standards to forge ahead.

What are analysts saying?

Waymo is a subsidiary of Alphabet and part of its “Other Bets” business. Cruise, meanwhile, is a an autonomous subsidiary of General Motors. So far, this San Francisco decision isn’t moving the needle on either stock.

Headlines about a dip in General Motors stock this week revolve around union demands, and not the fact that on Friday, a small fleet of Cruise autonomous vehicles temporarily blocked traffic in San Francisco’s North Beach neighborhood.

As more robotaxis hit the streets, we’ll keep an eye on their parent companies’ stock. We’re also watching Uber and Lyft, as these robotaxis will now operate in competition with them.

The bottom line

This is a big step for autonomous vehicles from an innovation and policy perspective. That said, there’s a lot of skepticism still around safety, efficacy, and what’s best for city residents. We anticipate more hiccups with the robotaxi rollout, and imagine it’ll be some time before we see robotaxis buzzing around nationwide.

Transportation progress is happening, but not over night — to us, this one feels like more of a long game.

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