September 2025 was a milestone month for Waymo in California: It reached 1,000,000 paid driverless rides. This represents a year-over-year increase of ~182%, which is a pretty good sign that the technology works and that customers like it.
(Note: The dramatic falloff in rides in June 2025 was because of anti-ICE protests and vandalism taking place in Los Angeles and San Francisco. The company decided to temporarily suspend operations.)
This is still a small fraction of the traditional ride-hailing market, though. According to the California Public Utilities Commission, Uber and Lyft combined complete somewhere around 300-320 million passenger trips per year in the state. That averages out to roughly 25-27 million trips per month for context.
September 2025 was a milestone month for Waymo in California: It reached 1,000,000 paid driverless rides. This represents a year-over-year increase of ~182%, which is a pretty good sign that the technology works and that customers like it.
(Note: The dramatic falloff in rides in June 2025 was because of anti-ICE protests and vandalism taking place in Los Angeles and San Francisco. The company decided to temporarily suspend operations.)
This is still a small fraction of the traditional ride-hailing market, though. According to the California Public Utilities Commission, Uber and Lyft combined complete somewhere around 300-320 million passenger trips per year in the state. That averages out to roughly 25-27 million trips per month for context.
The autonomous vehicle narrative has historically gone something like this: remove the labor component of rides (i.e. drivers) and rides will become significantly cheaper. Then, people won't need or want to own a car anymore. They'll just Uber or Waymo or whatever around.
But as Waymo provides in and around 250,000 paid trips per week in the 4 cities in which it operates, the opposite has proven to be true — at least so far. A recent report by Obi (an app that aggregates real-time ride pricing) has just revealed the following for San Francisco during the period of March 25 to April 25, 2025:
In other words, Waymo is more expensive than Uber and Lyft, especially for shorter distances. Is this right? Well, Waymo may not have to pay drivers, but they do own and operate their own cars. Uber and Lyft do not. This represents a very different cost structure.
They also have a more inelastic supply base, meaning they have cars whether demand is high or not. Whereas in the case of Uber and Lyft, supply can be variable. That's the idea behind "surge pricing" — to induce more drivers onto the road when it's needed the most.
Fewer Waymos also means that wait times are going to be longer and that their cars are probably spending more time driving around without paying passengers. That's a cost.
Whatever the reasons, lots of people seem to be willing to pay the premium. Part of this almost certainly has to do with the novelty of riding in an autonomous vehicle. I'd pay more if they were in Toronto today. But another reason seems to be that people really appreciate being in the car alone. I guess it's akin to driving your own car.
It, of course, remains to be seen how Waymo's cost structure and pricing model will evolve over time, but I have no doubt that privacy will remain a feature people are willing to pay something for. In the modern world, we are all going to have at least two places of solitude: bathrooms and Waymos.
Waymo and Lyft now have the same market share in San Francisco
In August 2023, when Waymo first launched its self-driving vehicles in San Francisco, the market shares of Uber and Lyft were 66% and 34%, respectively.
By the end of last year, these market shares had dropped to 55% and 22%, respectively, with Waymo on equal footing with Lyft. (These numbers specifically refer to rides that start and end within the boundaries of where Waymo operates and do not, for example, include rides to the airport.)
So the result was low double-digit losses in market share for both companies. This is not all that surprising given that autonomous vehicles are a novel thing and that Waymo's cars seem to be nicer than most Ubers and Lyfts. But it also shows that there maybe isn't a great deal of customer loyalty between the various platforms, that is, as long as the wait times are reasonable.
I think the more difficult questions remain: What does the ride-hailing space look like as AVs become more ubiquitous across our cities? Who is going to own what? And will individual car ownership fall?
We've spoken before about the peak load problem that Waymo faces as a result of owning its own cars. It's expensive to manage a fleet like this, especially relative to Uber's variable supply model. So one scenario remains a close partnership between Waymo and Uber, where Uber handles any above-base spikes in demand with actual humans.
But another scenario might be a hybrid approach where some of the AVs are owned by a ride-hailing company and some are owned by individuals who just contribute them to the network when they don't need them. This is what Tesla has been promising and, who knows, maybe it'll actually happen someday. Reilly Brennan recently wrote about this over here.
Personally, I would love to not own a car. It's also hard to imagine being able to make much money off a car that only goes to work during peak times, when the other robots are too busy. So I'm not convinced of this model. But I can see why Waymo is gaining market share. Privacy and a nicer cleaner vehicle are desirable features.
The autonomous vehicle narrative has historically gone something like this: remove the labor component of rides (i.e. drivers) and rides will become significantly cheaper. Then, people won't need or want to own a car anymore. They'll just Uber or Waymo or whatever around.
But as Waymo provides in and around 250,000 paid trips per week in the 4 cities in which it operates, the opposite has proven to be true — at least so far. A recent report by Obi (an app that aggregates real-time ride pricing) has just revealed the following for San Francisco during the period of March 25 to April 25, 2025:
In other words, Waymo is more expensive than Uber and Lyft, especially for shorter distances. Is this right? Well, Waymo may not have to pay drivers, but they do own and operate their own cars. Uber and Lyft do not. This represents a very different cost structure.
They also have a more inelastic supply base, meaning they have cars whether demand is high or not. Whereas in the case of Uber and Lyft, supply can be variable. That's the idea behind "surge pricing" — to induce more drivers onto the road when it's needed the most.
Fewer Waymos also means that wait times are going to be longer and that their cars are probably spending more time driving around without paying passengers. That's a cost.
Whatever the reasons, lots of people seem to be willing to pay the premium. Part of this almost certainly has to do with the novelty of riding in an autonomous vehicle. I'd pay more if they were in Toronto today. But another reason seems to be that people really appreciate being in the car alone. I guess it's akin to driving your own car.
It, of course, remains to be seen how Waymo's cost structure and pricing model will evolve over time, but I have no doubt that privacy will remain a feature people are willing to pay something for. In the modern world, we are all going to have at least two places of solitude: bathrooms and Waymos.
Waymo and Lyft now have the same market share in San Francisco
In August 2023, when Waymo first launched its self-driving vehicles in San Francisco, the market shares of Uber and Lyft were 66% and 34%, respectively.
By the end of last year, these market shares had dropped to 55% and 22%, respectively, with Waymo on equal footing with Lyft. (These numbers specifically refer to rides that start and end within the boundaries of where Waymo operates and do not, for example, include rides to the airport.)
So the result was low double-digit losses in market share for both companies. This is not all that surprising given that autonomous vehicles are a novel thing and that Waymo's cars seem to be nicer than most Ubers and Lyfts. But it also shows that there maybe isn't a great deal of customer loyalty between the various platforms, that is, as long as the wait times are reasonable.
I think the more difficult questions remain: What does the ride-hailing space look like as AVs become more ubiquitous across our cities? Who is going to own what? And will individual car ownership fall?
We've spoken before about the peak load problem that Waymo faces as a result of owning its own cars. It's expensive to manage a fleet like this, especially relative to Uber's variable supply model. So one scenario remains a close partnership between Waymo and Uber, where Uber handles any above-base spikes in demand with actual humans.
But another scenario might be a hybrid approach where some of the AVs are owned by a ride-hailing company and some are owned by individuals who just contribute them to the network when they don't need them. This is what Tesla has been promising and, who knows, maybe it'll actually happen someday. Reilly Brennan recently wrote about this over here.
Personally, I would love to not own a car. It's also hard to imagine being able to make much money off a car that only goes to work during peak times, when the other robots are too busy. So I'm not convinced of this model. But I can see why Waymo is gaining market share. Privacy and a nicer cleaner vehicle are desirable features.
