Wayve Expands in U.S., Begins Level 2+ Testing in California
This Week in The Autonomy Economy is presented by Koop Insurance, a specialist insurance provider focused on robotics and autonomous vehicles
The market for autonomy IPOs is currently hot as Horizon Robotics raised $696 million in their Hong Kong IPO (largest IPO of the year in Hong Kong), WeRide raised $440 million in their Nasdaq IPO and Pony AI has filed to go public on Nasdaq.
Both the public and private markets have an appetite for autonomy now. Didi Autonomous Driving recently raised $298 Million in a Series C round led by GAC Group with participation from Didi. Waymo raised $5.6 billion in funding led by Alphabet with continued participation from Andreessen Horowitz, Fidelity, Perry Creek, Silver Lake, Tiger Global, and T. Rowe Price.
Then there is Tesla. Tesla’s stock rallied over 22% this week after reporting earnings that beat the street, closing at its highest valuation in 13 months. The market is clearly telling us that autonomy is back in vogue with investors. Which companies will be next to tap the markets either public or private?
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What’s Moving the Markets
Wayve Expands in U.S., Begins Level 2+ Testing in California
On October 23rd, Wayve announced that they have expanded in the U.S. with a base of operations in California. As part of the expansion, Wayve has begun testing Level 2+ vehicles on public roads, enabling Wayve to continue gathering diverse data that will help develop their embodied AI approach to autonomous driving.
Wayve’s approach to autonomy does not rely on HD maps. It is a similar approach in some ways to both Tesla and Kodiak. When HD maps were all the buzz in 2020/2021 we conducted a significant amount of financial due diligence and came to the conclusion that autonomous vehicles and trucks that rely heavily on HD maps would not scale without large amounts of continued funding.
While certain HD maps were impressive (DeepMap was the most impressive), they were never going to scale unless companies had funding from the 3 A’s: Alphabet, Amazon, Apple. It was around this time that we met Andreas Wendel, CTO of Kodiak. He opened our eyes to what is possible without HD maps.
We firmly believe that you do not need HD maps to scale autonomous driving. Kodiak along with Tesla has proven this at scale and now Wayve is on their way to proving it as well.
Could we get to the point where the old traditional autonomous driving stacks will have to be rebuilt from the ground up? Possibly. We know one company that recently completed a complete rebuild of their stack from a robotics based stack to an AI stack. The difference in performance? Dramatic.
Wayve does not have to rebuild, they just have to keep building. Does this give them a competitive advantage as they scale? It could. The other advantage is their business model—flexible AI licensing for automakers. Autonomous driving stacks are changing and AI is ushering in that change.
If you are interested in learning more about Wayve, we would recommend the following podcast:
- AV 2.0, Wayve’s Approach to Autonomous Driving, A Conversation with Alex Kendall, Co-Founder and CEO, Wayve (March 26, 2024)
Our take: Wayve is one of the most important companies in autonomy today. The company has an extremely bright future.
Wayve is currently ranked #4 with a positive outlook on the AUTONOMY LEADERBOARD in the autonomous vehicle category.
Waymo Raises $5.6 Billion in New Funding
On Friday, October 25th, Waymo announced that the company raised $5.6 billion in a round led by Alphabet, with continued participation from Andreessen Horowitz, Fidelity, Perry Creek, Silver Lake, Tiger Global, and T. Rowe Price.
The new funding is going to be used to expand the Waymo business. As Waymo expands we expect to see two new city announcements by the second half of next year. We believe that those cities will be on the east coast with Miami and Nashville potentially being either one or both of the cities.
Furthermore we expect Waymo to once again begin diversifying their business model and sources of revenue. Just this week, Dmitri Dolgov, Co-CEO of Waymo told the No Priors podcast that there are plans to deploy the Waymo Driver in different modalities including deliveries, long-haul trucking and personally owned vehicles.
If and when Waymo puts these plans into place, they are going to partner and not build. We saw the early signs of this strategy in their robotaxi business when they shuttered the Firefly in 2017. Since then Waymo has taken a partner approach towards vehicle development.
The partner approach is now making its way to software as Waymo has announced several deals with Uber to make the Waymo robotaxis available on the Uber network. There are a lot of ifs surrounding the Waymo business now, but there is also a lot of opportunity.
Two of the things that we are most interested in the Waymo business currently are long-haul trucking and personal vehicles. In our regular conversations with trucking executives we know that there is a strong desire to see Waymo move back into long-haul trucking. Will it happen? We, along with the executives we speak with are unsure, but if Waymo did re-enter trucking, the industry would welcome them back.
Then there is personal vehicles. Could Waymo develop a “lite” version of the Waymo driver and license it to OEMs? If Waymo was able to technically accomplish this and strike the right business terms, that would put Waymo in direct competition with Tesla, Wayve and Nuro. 2025 could turn out to be the year of autonomy licensing deals.
No matter what business paths Waymo ultimately chooses, the company (supported by Alphabet’s massive resources) continues to be undisputed leader in the development and commercialization of autonomous vehicles.
Our take: As Waymo continues to scale, the big question on investors’ minds is what does Alphabet do? Does Alphabet continue to grow the business with the goal of making it a self-sustaining business unit, or once certain metrics are met, Waymo gets spun out?
Waymo is currently ranked #1 with a bullish outlook on the AUTONOMY LEADERBOARD in the autonomous vehicle category.
Tesla and Waymo parent Alphabet are The Road to Autonomy Index component companies
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Piquing Our Interest
Elon Musk Calls for a National Autonomous Vehicle Framework On Tesla’s Q3 earnings call, Elon Musk called for a national autonomous vehicle framework. If President Trump wins election, could we finally see movement on the autonomous vehicle regulatory front?
The City of Palo Alto is Exploring a Robotaxi Deal with Tesla In an effort to provide affordable rides to the community, the City of Palo Alto has held preliminary discussions with Tesla about a potential robotaxi service. At this time, it is unclear if this will be a supervised or unsupervised service.
Horizon Robotics Stock Soars 28% on IPO Debut in Hong Kong Horizon Robotics had a successful IPO with the company raising $696 million.
We Ride Raises $440 Million in U.S. IPO WeRide raised $440 million in a successful IPO on the Nasdaq this week.
Didi Autonomous Driving Raises $298 Million In a Series C round led by GAC Group with participation from Didi, Didi Autonomous Driving successfully raised $298 million.
Waymos Are Proving to Be a Tourist Attraction in San Francisco First San Francisco wanted to ban autonomous vehicles, next they want to embrace them as they are proving to be popular with tourists. What’s next, a progressive autonomous vehicle tax? It would be wise to be very skeptical of this sudden embrace.
Cruise Goes Driverless in Houston Iggy Pop once sang Bright lights, Houston is hot tonight. The lyrics could now be changed to Bright lights, Houston is driverless tonight as Cruise has pulled the driver in Houston. Even though Cruise is testing driverless in a small ODD with no members of the public, this is still a major milestone for Cruise 2.0.
Social Buzz
Tesla Vehicles Have Driven Over 2 Billion Miles on FSD Supervised
Tesla’s data advantage only continues to grow as the company pursues a vision-only approach to autonomous driving with over 2 billion miles of FSD (Supervised) data. Comparatively, Waymo has driven 25 million miles fully autonomously (as of July 2024).
Waymo has only autonomously driven 1.25% of all the miles Tesla has driven. While these miles are not a direct correlation, as FSD Supervised has interventions and they are not fully autonomous, it is still a very interesting benchmark when it comes to developing virtual drivers.
Our take: If Waymo is only at 1.25% of the autonomous miles today compared to Tesla, what happens when they reach 2 billion miles? Does Waymo unlock a vision-only system that could be licensed to automakers? Or will the world’s greatest “virtual” driver emerge?
Tesla is currently ranked #1 with a bullish outlook on the AUTONOMY LEADERBOARD in the personally owned autonomous vehicle category. Tesla and Waymo parent Alphabet are The Road to Autonomy Index component companies
Bosch was Allocated 83.3% of the WeRide IPO
Less than 20% of WeRide’s stock was available for purchase when the company began trading on Nasdaq, Friday. The small amount of publicly available shares led to a 19% intraday gain, WeRide’s stock ($WRD) eventually closed up 6.77% on its trading debut.
On the latest episode of Autonomy Markets, Walter Piecyk and Grayson Brulte broke down the WeRide IPO. You can watch their analysis of the IPO here.
Our take: Bosh’s oversized IPO allocation raises more questions than answers about the health of WeRide’s business.
The Road to Autonomy Index® / Weekly Performance
The Road to Autonomy Index® is a high-definition lens into the emerging world of autonomous vehicles. It is the world’s first and only pure-play index designed to measure the performance of the autonomous vehicle/truck market.
For the week of October 21st, The Road to Autonomy Index returned 1.09%, the S&P 500 declined 0.96% and the NASDAQ 100 retuned 0.14%. The Road to Autonomy Index outperformed the S&P 500 by 2.05% and outperformed the NASDAQ 100 by 0.95%.
Year to Date (YTD), The Road to Autonomy Index has returned 18.36%
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Latest The Road to Autonomy Podcast
From TuSimple to Bot Auto: Xiaodi Hou’s New Plan for Profitable Autonomous Trucking
Xiaodi Hou, Founder & CEO, Bot Auto joined Grayson Brulte on The Road to Autonomy podcast to discuss his plans for building and scaling a profitable autonomous trucking company.
Watch on YouTube | Spotify | X
Listen on Apple Podcasts
Tuesday, October 22, 2024
Latest Autonomy Markets Podcast
Autonomy IPOs Heat Up: Tesla’s 20% Rally, WeRide’s $440M IPO, & Waymo’s $5.6B Funding Round
Tesla’s stock rallied 20% following earnings that beat the street and Elon Musk’s continued commentary about Tesla’s robotaxi ambitions. WeRide completed its NASDAQ IPO raising $440M on October 25th, the same day Waymo announced a massive $5.6B funding round led by Alphabet with participation from Tiger Global and Sliver Lake.
Watch on YouTube | Spotify | X
Listen on Apple Podcasts
Saturday, October 26, 2024
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A weekly newsletter featuring insight and commentary on the autonomy economy™ and how the financial markets are viewing its emergence.
All price references and market forecasts are as of the date that this newsletter has been sent. The Road to Autonomy is not providing any financial, economic, legal, accounting, or tax advice or recommendations in this newsletter. The information contained in this newsletter does not constitute investment advice and should not be relied upon to evaluate any potential transaction.
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