Alphabet’s Waymo Leads on Safety, but Tesla Could Still Close the Robotaxi Gap
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Alphabet’s Waymo Leads on Safety, but Tesla Could Still Close the Robotaxi Gap Ghazal Ahmed Mon, August 17, 2026 at 1:43 PM EDT 4 min read TSLA GOOG According to Goldman Sachs Research, the global robotaxi market is estimated to reach approximately $415 billion in 2035. Improving safety records and stronger customer demand are said to be fueling this surge, as per analyst Mark Delaney. Two notable names in the robotaxi space increasingly making a mark are Alphabet Inc.'s (NASDAQ: GOOGL ) Waymo and Tesla, Inc. (NASDAQ: TSLA) . Despite taking on different approaches to autonomous driving, both are well-positioned to emerge as major players in the US robotaxi market. TD Cowen analyst Itay Michaeli recently reiterated a Buy rating and $460.00 price target on Tesla (NASDAQ: TSLA). Hosting autonomous vehicle expert Alex Roy on its Internet Bus Tour, the discussion largely focused on AV rideshare scaling and potential licensing to automotive OEMs. According to Roy, both Tesla and Waymo are well-positioned to scale in the US AV market. Waymo, in particular, is in a stronger position currently because of its rollout scale and overall safety. As per a study by the Insurance Institute for Highway Safety (IIHS), driverless robotaxis by Waymo had 68% lower police-reportable crash involvement rate per mile than human drivers in four US cities. In Phoenix, the crash rates per mile were 75% lower, 71% lower in Los Angeles and 35% lower in San Francisco. In recent news, the company also received the CPUC's approval to expand its autonomous ride-hailing service across the SF Bay Area and LA, bringing its services to Sacramento and San Diego. Waymo's larger commercial footprint and stronger safety record makes it easier to win customer trust and regulatory approvals. However, the bear case for Waymo is that it needs to shrink the size of the lidar and camera apparatus if it wants to make it more appealing to consumers. This is important if Waymo wants to license its technology to major automakers in the future. While Tesla is currently focused on improving the safety profile of its software stack, Roy believes that it has the potential to catch up. Tesla's game isn't at par at Waymo right now, but Roy believes the two will converge at some point. This is particularly true if at some point, younger consumers may view Tesla's safety levels as "good enough," despite not being as safe as Waymo. The bull case, therefore, is that Tesla doesn't need to be as safe as Waymo. Tesla's ability to become "good enough" while potentially benefiting from an AV architecture that is easier to deploy broadly could narrow Waymo's lead in scale. This could in turn support a large ride-sharing structure for Tesla and even create a licensing opportunity. However, since Tesla doesn't disclose apples-to-apples safety data relative to Waymo, it is difficult to ascertain how close its system is to that threshold. Both Waymo and Tesla may also face future competition, with Zoox, Wayve, and the Lucid/Nuro partnership with Uber key names to watch. As per Insider Monkey's database, 123 hedge fund holders held stake in the stock at the end of the first quarter, down from 137 in the previous quarter. For Waymo, Alphabet acts as the closest market-proxy. The stock was held by 265 hedge funds, down from 288 in the prior quarter. While boasting broader hedge fund ownership, Alphabet's exposure is not just a reflection of Waymo's robotaxi bet, but also its larger businesses including Search, Youtube, and Google Cloud. Meanwhile, Tesla trades at about 175 times forward earnings, while Alphabet trades at approximately 16.9 times. Overall, Waymo remains ahead of Tesla in terms of safety and current robotaxi rollout. However, that lead is not guaranteed to persist as Tesla improves its autonomous technology and future competitors emerge. For Tesla, the case depends on making an autonomous driving system safe enough for future widespread customer adoption while preserving its hardware and software architecture. While we acknowledge the potential of TSLA as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock . READ NEXT: Apple Could Hit $400, But AI Is Coming for Its Most Profitable Business and IREN's $100 Bull Case Hinges on a 5-10x AI Cloud Advantage Disclosure: None. Follow Insider Monkey on Google News .
AI 시장 분석
According to Goldman Sachs Research, the global robotaxi market is projected to grow to approximately $415 billion by 2035. Alphabet's Waymo is leading the market based on superior safety and regulatory approvals, while Tesla is trying to narrow the gap through software improvements. Investors should closely monitor the pace of autonomous driving technology development and commercialization scale of both companies.
상승 영향
- AI — The global robotaxi market is expected to grow to $415 billion by 2035, accelerating the commercialization of autonomous driving technology.
DYAX 전담 분석
Waymo has secured a commercialization advantage through a 68% lower accident rate compared to human drivers and regulatory approvals, providing positive momentum for Alphabet's stock price. On the other hand, Tesla is pursuing market share by deploying 'good enough' software rather than absolute safety, but data scarcity and regulatory uncertainty act as risks.
The bull scenario is that both companies generate large-scale licensing revenues driven by the rapid growth of the autonomous driving market, while the bear scenario is that commercialization schedules are delayed due to safety issues or tighter regulations. Key metrics to watch are Waymo's progress in hardware miniaturization and whether Tesla discloses its driving safety data.
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