Waymo rides cost more than Uber or Lyft — and people are paying anyway

In the evolving landscape of transportation, the emergence of robotaxis was anticipated to lower costs significantly due to high demand and reduced labor expenses. However, recent findings suggest this expectation remains unfulfilled. A comprehensive analysis from Obi, an app that aggregates real-time pricing and wait times across various ride-hailing services, reveals that rides with Waymo consistently exceed the costs of Uber and Lyft, yet customers continue to opt for them. The report, shared exclusively with TechCrunch, is based on data collected from March 25 to April 25 in San Francisco. Obi examined nearly 90,000 records from Waymo, Lyft’s standard service, and UberX to compare pricing and estimated arrival times. The analysis unveiled that Lyft offered the lowest average fare at $14.44, followed by Uber at $15.58, while Waymo's average price reached $20.43. Ashwini Anburajan, Obi’s chief revenue officer, expressed surprise at the popularity of Waymo’s service, especially given its higher pricing. Waymo reported providing around 250,000 paid trips each week across its initial four cities, suggesting that cost has not deterred interest. Anburajan noted, "There’s a common belief that autonomous vehicles will threaten driver jobs, but the reality is that operating an AV is quite expensive, at least in the short term." The pricing discrepancies are particularly pronounced during peak hours, with Waymo rides costing approximately $11 more than Lyft and nearly $9.50 more than Uber. Anburajan remarked, "I didn’t expect consumers to be willing to pay up to $10 more, which indicates a strong excitement for the technology and a preference for the novelty of a driverless experience." Obi's study also highlighted that Waymo's pricing tends to vary more than its competitors'. Anburajan suggested that this might stem from Waymo's less sophisticated pricing model compared to Uber and Lyft, which have spent over a decade optimizing their pricing strategies. Uber and Lyft benefit from more dynamic pricing systems due to their flexible driver availability, while Waymo operates with a largely fixed and slowly expanding fleet. The implications of Waymo's pricing model are twofold. Firstly, shorter trips tend to be more expensive, with Waymo rides costing roughly $26 per kilometer for trips under 1.4 kilometers, significantly higher than Uber and Lyft. Secondly, longer wait times translate to pricier trips, as sending a vehicle long distances to pick up passengers reduces the number of high-margin short rides. Despite these challenges, Waymo's customer base remains undeterred, even as the data indicates longer wait times for its rides. Obi also surveyed users in Los Angeles, San Francisco, and Phoenix, revealing that 70% of respondents favored driverless cars over traditional taxis or rideshares. However, safety concerns loom large, with 74% of participants citing safety as their primary worry regarding robotaxis, and nearly 70% advocating for some form of remote human oversight during rides. Interestingly, when asked about their willingness to pay more for a Waymo ride, nearly 40% of respondents indicated they would prefer to pay the same or less, while a combined 26.4% expressed they were willing to pay up to $10 more. Anburajan pointed out that the allure of being alone in a driverless vehicle is a significant factor in attracting customers: "It creates a personal space to travel comfortably from point A to point B."