A section of the market is quite bullish on autonomous cars and robotaxis, and tech giants are spending big money on the technology. However, more often than not, robotaxis are in the news for unpleasant reasons including crashes, and in the most recent such case, Waymo driverless cars have repeatedly honked in a San Francisco parking lot.

While the repeated honking has been a nuisance for those living around the parking lot, it also raises concerns about whether Waymo – or for that matter any other company can ever come up with a perfect robotaxi.

For context, a widely circulated video shows a Waymo parking lot where some cars are circling to find a parking place with their headlights on and blinkers flashing. The cars are also honking at each other while finding a place to park themselves.

Waymo fixed the bug arising out of a safety feature which triggered a honk when a car detects another vehicle reversing toward it. However, the overnight honking continued to the discomfort of those living nearby that parking lot.

The incident led to some hilarious memes online with some finding it funny that Waymo self-driving cars can “create” a traffic jam among themselves and then honk at each other.

However, it also raises a question over not only Waymo’s ability to fix the issue but hurts its reputation, especially as the Google-backed company considers expanding beyond San Francisco, Phoenix, and Los Angeles.

Waymo Is Part of Alphabet’s Other Bets Segment

Waymo is part of Alphabet’s Other Bets segment which includes new business segments that the Google parent is working on. The segment has been posting perennial losses on scant revenues. In Q2 2024, the Other Bets segment generated an operating loss of $1.1 billion on revenues of $365 million.

Alphabet’s CEO Sundar Pichai was quite optimistic about Waymo during the Q2 2024 earnings call though and said that he was “pleased” with the segment’s performance and especially highlighted the “rave reviews” it has received from users. He added that Waymo was now doing 50,000 weekly paid public rides, mainly in San Francisco and Phoenix.

Alphabet’s outgoing CFO Ruth Porat was equally upbeat on Waymo and termed it as an example of “technical leadership coupled with progress on operational performance.”

She also highlighted the multi-year $5 billion investment that Alphabet has committed to Waymo. “This new round of funding, which is consistent with recent annual investment levels, will enable Waymo to continue to build the world’s leading autonomous driving technology company,” said Porat in what was her last earnings call as Alphabet’s CFO.

Would Fully Autonomous Cars Ever Be a Reality?

To be sure, not all companies believe that fully autonomous cars can ever be a reality. China’s BYD, which is the largest seller of NEVs (new energy vehicles) globally, believes that self-driving technology has more utility in industries rather than in cars, and fully autonomous cars are not possible.

Last year, a BYD spokesperson said, “We think self-driving tech that’s fully separated from humans is very, very far away, and basically impossible.”

Uber was among the first companies to ditch its autonomous driving business and in 2020 it sold the business to Aurora Innovation, a self-driving startup. In return, Uber took a stake in the company and is the biggest stockholder now.

That said, Uber and BYD are collaborating to bring BYD’s “autonomous capable vehicles” to Uber’s platform.

Other companies also have a more nuanced view and in 2022 Ford wrote off its $2.7 billion investment in autonomous driving startup Argo AI that went bankrupt. The company also announced that it would not focus on L4 autonomous systems. Ford’s CEO Jim Farley said that while companies have spent a cumulative $100 billion towards level 4 autonomous vehicles, no company has been able to define a profitable business model.

Things have been challenging for startup autonomous companies and last year, autonomous trucking company Embark which was once valued at over $5 billion sold itself for a mere $71 million to Applied Intuition.

Tesla’s Robotaxis Are Also Delayed

Tesla, whose CEO Elon Musk believes that the bulk of Tesla’s mammoth valuation comes from its progress on autonomous driving, is also looking to launch robotaxis. However, the company delayed the event and instead of August 8 as it was originally scheduled, Tesla will now hold it on October 10.

Musk said that Tesla needs the time to make some more improvements to the vehicle. He added, “And we’re also going to show up a couple of other things. So, moving it back a few months allowed us to improve the Robotaxi as well as adding a couple of other things for the product unveil.”

Notably, Musk had once boasted that Tesla would have a million robotaxis on roads by 2020. Tesla’s advanced autonomous driving which it calls full self-driving (FSD) even as the software is far from being fully autonomous, has also missed several “end of the year” deadlines that Musk touted.

During the Q2 2024 earnings call, Musk mocked General Motors’ halting the testing of its Cruise self-driving cars and said that the company did so not because of regulatory issues as it claimed but because “GM can’t make it work.”

Musk Doubts Waymo’s Ability to Expand

The billionaire pointed out that Waymo was also driving its robotaxis in the same markets as GM but did not complain of regulatory issues.

He was however not too optimistic about Waymo’s ability to expand and said that Waymo has a “very localized solution that requires high-density mapping. It’s not — it’s quite fragile. So their ability to expand, I believe, is limited.”

Meanwhile, even as several companies – especially in the US and China – are investing billions of dollars towards autonomous driving and robotaxis, the Waymo honking incident shows that the technology has still a long way to go before fully self-driving cars become a reality.