Waymo's Growing Threat to Traditional Ride-Hailing

Ross Gerber, co-founder of investment firm Gerber Kawasaki, isn't holding back his thoughts on the future of ride-hailing. He believes Alphabet Inc. (GOOGL) (GOOG)-backed Waymo's expansion in San Francisco could pose a serious challenge to Uber Technologies Inc. (UBER).

In a post on X Friday, Gerber shared that Waymo has already seized 10% of the San Francisco market, and that's just through its own app. His verdict? "Uber is cooked."

But Gerber didn't stop there. "Uber drivers better start upgrading the experience because I prefer Waymo 10x more than an uber driver," the investor wrote, making his preference for autonomous vehicles crystal clear.

Why Gerber Thinks Waymo Has The Edge

This isn't the first time Gerber has sung Waymo's praises. He previously declared the company a leader in the autonomous cab space, noting that "Waymo is well ahead in the robotaxi business and getting further by the week."

Interestingly, Gerber has also acknowledged improvements in Tesla Inc. (TSLA)'s Full Self-Driving (FSD) system, calling recent updates a "big step-up" from previous versions. Tesla has been making moves of its own, recently offering free FSD rides to customers across multiple European countries as it plans to expand its self-driving technology on the continent.

How Uber Is Fighting Back

Uber isn't sitting idle while autonomous vehicles circle its business. CEO Dara Khosrowshahi announced that the platform will start offering high-paying artificial intelligence gigs to drivers through a new initiative called Digital Tasks. The program, which allows users to complete short AI-related tasks through the Uber Driver app, is already running in India and will expand through a pilot operation.

On the autonomous front, Uber is actually embracing the technology rather than fighting it. The company recently launched self-driving operations with WeRide Inc. (WRD) in the United Arab Emirates. Abu Dhabi became the first city in the Middle East and the first market outside the United States to offer level 4 autonomous driving cabs on the Uber platform.

Level 4 autonomy means the vehicles can handle all driving tasks in specific conditions without human intervention, representing a significant technological milestone for the ride-hailing industry.

What This Means For The Ride-Hailing Future

The tension between traditional ride-hailing and autonomous vehicles isn't going away. Waymo's 10% market share in San Francisco suggests that when given the choice, a meaningful portion of riders prefer self-driving cars to human drivers. That's a data point that should make everyone in the gig economy pay attention.

Uber's dual strategy of offering AI gigs to drivers while simultaneously partnering with autonomous vehicle companies like WeRide shows the company is hedging its bets. It's preparing for a future where both human and robot drivers might coexist on its platform.

Price Action: UBER shares climbed 2.19% to close at $87.54 on Friday, according to market data.