Waymo wants to offer robotaxis in California. But the state insists they be
November 1, 2019 Russ Mitchell ©2019 the Los Angeles Times
Waymo wants to deploy a robotaxi service for the general public in parts of
California as soon as possible. But that's unlikely, the company says,
because California says it has to offer the service for free.
Last year, the California Public Utilities Commission allowed driverless
"robotaxi" pilot programs in the state but banned permit-holders from
charging fares. The ban is considered temporary but has no timeline. Some
industry analysts say the uncertainty could put California's reputation as
the world leader in driverless technology at risk.
The free-or-nothing mandate makes no sense to Waymo, the driverless vehicle
arm of Google's Alphabet, or to other driverless vehicle startups hoping to
establish themselves in a new industry that could produce the biggest change
in ground transportation since the invention of the automobile.
Waymo requires a "commercial path forward" before it can offer Californians
the kind of driverless car taxi service it's already running across 100
square miles in Phoenix, according to the George Ivanov, Waymo's head of
policy development and regulatory initiatives.
Without the ability to charge fees, Ivanov told the commission at an Oct. 22
hearing in San Francisco, "any expansion would be difficult" in the
company's home state.
In July, Waymo began a commission-approved pilot program to ferry Waymo and
Google employees and guests through parts of Silicon Valley in driverless
cars for free.
Waymo doesn't need fare money to fund operations — Alphabet is an enormous
profit machine, and holds more than $100 billion in cash. But Ivanov
explained that experimenting with customer response to different fare
structures is essential to building out the robotaxi business, which would
be like Uber or Lyft but without a human driver.
Smaller companies hoping to grab a piece of what could grow into an industry
worth hundreds of billions of dollars want to be able to charge fares too.
"There are commercial goals we are working toward," Bert Kaufman, head of
regulatory affairs for Zoox, told the commission.
Based in San Francisco, Zoox is developing a small bus-like driverless
vehicle with plans to deploy initially in Las Vegas. Kaufman said it wants
to offer the service in California but it can't plan for deployment if it
doesn't know when it might be able to charge fares.
Experimenting with fare structures at different times of day and in
different locations would help a company know where and when to begin
offering a full-fledged commercial service, Kaufman said at the Oct. 22
hearing. "Regulatory certainty" is one reason the company will start out in
Nevada, he said. It would help, he told the commission, "knowing that
California is actually open for business."
In California, the state Department of Motor Vehicles regulates vehicle
safety and issues permits for driverless vehicle testing and deployment. The
CPUC, whose main task is regulating utilities such as Pacific Gas &
Electric, also oversees commercial transport services, from bus companies to
limousine services to Uber and Lyft. It's up to the CPUC to decide whether
companies can charge fares or not.
The commission declined to make commissioners or staff members available for
an interview. A commission spokeswoman pointed to a document issued in June
2018 that set rules for driverless vehicle pilot programs in California.
"The free rides will identify the pilot program as different from ordinary
transportation," the document reads, "and, therefore, will encourage the
public to be more mindful of their experience and provide critical feedback
to the commission and the permit-holders."
Other driverless companies at the hearing — which included Cruise, Aurora,
Pony.ai and AutoX — seemed baffled by the reasons given for banning paid
driverless pilot programs.
"It's very important we're able to charge for our service not just for us
but for the entire industry in California," said Jewel Z. Li of AutoX, which
is developing autonomous technology and robotaxi logistics systems in the
U.S. and in China. It's important, she said, to test "real-life sustainable
If companies eschew California for more welcoming states, the economic
impact is likely to be small. In any case, it's not the CPUC's
responsibililty to consider economic growth in the state. In the past, some
experts have lauded California's cautious approach to driverless regulation.
But "California runs a risk of losing some of its mantle of being the center
of driverless vehicle innovation," said Mike Ramsey, an automotive
technology analyst at Gartner.
Ramsey also is interested in hearing more detail about the commission's
objection to fare charging. "This is not a safety issue," he said. "This is
about the capability of a company to recover some of the costs, if not to
profit" from technology development.
Grayson Brulte, head of driverless vehicle consultants Brulte & Company,
earlier this year moved his headquarters to the Miami area from Beverly
Hills, because, he said, California's bureaucracy is dragging its feet.
"The future was being deployed in Florida, so we relocated our company to
Florida to be part of the future," he said. Florida's driverless regulations
are either more lax or more forward thinking than California's, depending on
whom you ask.
Advocates for the blind and for small business owners asked the commission
at the recent hearing to allow fare charging. Only one person supported the
idea of banning fares in pilot programs — a representative of the San
Francisco Metropolitan Transit Authority, who said the commission should
first ensure the public interest is being served.
After the hearing, one company representative said the commission is taking
too much time making decisions. The person asked not to be identified for
fear of antagonizing commission members.
The CPUC issued its permit rules in June 2018. The October hearing, called a
"workshop," was the first public discussion held since then.
The Times asked the commission spokeswoman if there is a timeline for
addressing the industry's fare-ban complaints.
"As for next steps," she wrote in an email, "we have committed to soliciting
(bs: shutting-off auton/ai or headlights will save range)
Tesla, NuTonomy, Waymo and the future of cars
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battery ... If you’re a petrolhead, look away now. Your next new motor could
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chargers will be used, according to the release ...
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