Ok, there are 3 parts to this story.
- AVIS Budget: One of the biggest Car Rental companies in the world with thousands of branches world wide.
- Google Waymo: Pioneer in developing Driver-less cars software and hardware. Been testing its technology on road for many years now & trying partnership with companies like UBER, LYFT etc. to bring its technology to the roads.
- Driver-Less Cars: The hot and happening trend across the globe ( or at-least in leading cities ). Nearly all research firms have unanimously agreed that this is going to be a multi-trillion dollar industry in the very near future.
WAYMO ( the self driving unit inside Google ), has been into Driver-less cars research for many many years. But in the recent years the tech giant seems to slip slightly behind TESLA in being the leader in this Self-Driving cars space. Thanks to the vertically integrated approach by TESLA, they are able to stand out in the Autonomous vehicle race ( as they own both the hardware & the software piece ). Being a car manufacturing company, TESLA was able to go ahead and integrate its Driver-less cars technology into its own cars without any process over-heads and complexities. This led TESLA to quickly bring the commercial cars on the road with the technology built-in.
Now, its WAYMO’s move & they are doing what they have been doing good historically. ie. Make partnerships with leaders in the space to integrate its technology and hit the road running.
AVIS Budget as we all know does a fabulous job in its niche ie. Car Rentals & can easily be declared as the leader in the industry. They have millions of vehicles under their belt serving millions of customers worldwide. With this deal, Waymo can easily get the much wanted advantage to take its Self-Driving technology to the roads in real-time.
As of now the deal allows Waymo to deploy its Driver-less cars for testing in Phoenix AVIS facilities. If this works out fine, they can roll it out in more AVIS locations. For AVIS Budget group, its a very important step, as it gives them an early foothold in the Driver-less car rental space ( which is obviously the future of Car Rentals ).
On Monday, Avis officially announced that it would provide the required ” Fleet support and maintenance services ” to the self-driving Waymo cars in the city of Phoenix. And much to the amusement of the people in the city, Waymo is offering free rides 🙂
John Krafcik, the CEO of Waymo earlier said, “Avis Budget Group is an ideal partner to provide fleet support and maintenance. With thousands of locations around the world, Avis Budget Group can help us bring our technology to more people, in more places.“.
The entire Car Rental industry stocks have been going down steep on speculations about “What will happen to this industry once Driver-less cars comes into the scene”. This new deal between Google Waymo & Avis Budget group has bought in positive sentiments & clarity to investors. Avis stock has raised a whooping 14% as a reaction to this partnership.
But still the big question remains. What will happen to the thousands of other small & medium Car rental businesses around the globe. Would they need to create partnerships with such giants to survive? Or is there an alternate solution coming up? Lets wait and see.