Uber didn’t necessarily get into self-driving cars to make friends. It launched its program in Pittsburgh by gutting the robotics program at Carnegie Mellon University, after all. But in the three years since—as the company has struggled with wayward leadership, a broken corporate culture, and this spring’s fatal crash, which killed an Arizona woman—Uber has learned that the buddy system may not be so bad. As this new technology moves slowly toward commercialization, its creators are grappling with how a robo-car business should work, exactly. It’s a murky world in which exploration feels safer, somehow, with a partner by your side.
This week, Uber found a friend. Toyota, which has worked with the ride-hailing giant in some form or another since 2016, will invest $500 million in the company, along with plenty of engineering manpower. The result, the companies say, will be self-driving Toyota Sienna minivans, which by 2021 will combine the Japanese carmaker’s carmaking expertise with Uber’s autonomous tech and ride-hailing platform. As for putting those cars into the streets, well, someone else will do that. Toyota and Uber are on the hunt for a third partner, job description to come.1
If you’re mystified, well, so is everyone else in the autonomous vehicle game. About everything, really. Questions range from the technical (How will self-driving cars nail tricky left turns?) to operational (How will they know that they’ve found the right passenger?) to existential (Who’s going to make money off these things, and how?”).
No one’s quite sure what the winning business model looks like yet, or who will excel at what. So companies are experimenting, diversifying their portfolios, and shacking up. The Uber-Toyota get together is just the latest in a young but entrenched tradition of automotive-related companies feeding off each others’ strengths and weaknesses. Waymo’s pretty good at self-driving software, and Avis can manage big fleets of cars, so they’re working together. Lyft is good at moving people and Magna builds car parts, so they’ve hooked up. And now, Uber gets to combine its tech savvy with Toyota’s manufacturing brawn. Plus, Toyota’s own self-driving know-how, which it too has been working on since 2015.
After this spring’s self-driving crash and last year’s allegations of corporate malfeasance, this deal has the added bonus of making Uber seem less untouchable. Toyota seems to think its new bud has changed its ways under bossman Dara Khosrowshahi, who took over for Travis Kalanick last summer. “We believe that Uber is transforming its corporate culture under the new CEO,” says Rick Bourgoise, the Toyota Research Institute’s communications head. “Both companies share the same values and objective to quickly realize safe and secure automated driving mobility services through collaboration.”
You can see why neither Toyota nor Uber are interested in the fleet management game, which involves maintaining, repairing, cleaning, and parking the vehicles. Technology platform tasks, these are not.
Uber’s job description for that third party fleet operator remains vague. “We haven’t actually taken the time to do a wholesale evaluation of what’s out there,” says Jeff Miller, Uber’s head of strategic initiatives. He says the company is instead building up its fleet management capabilities today, with its self-driving Volvos. That way, the company will have a sense for what it should be looking for in a helpmate… someday. (Uber paused its autonomous vehicle testing after the fatal crash in March, but is now back on the roads in Pittsburgh in manual mode.) The role isn’t entirely clear to Toyota, either. “We have nothing further to say other than Toyota is not currently considering starting its own ride-sharing services,” says Bourgoise.
That silence extends to how it might use Uber’s tech. Toyota has indicated will somehow combine its Guardian system, built to silently monitor how humans drive in intervene in the case of emergency, with whatever Uber has cooked up. Now, instead of humans, Guardian might monitor a computer. Maybe? “The interaction between Uber’s self-driving system and Guardian is not something we can yet comment on given development of the vehicle and the integration of technologies have not yet begun,” says Bourgoise.
Here’s what’s more clear: This Toyota partnership gives Uber another prospective role to play in a far-off future filled with robotaxis. The company could continue to work with a carmaker like Volvo to self-drive-ify vehicles, adding its own autonomous vehicle technology and operating the fleet of vehicles on its own. But to scale up someday, it will need to be able to get its technology into lots of cars, quickly and affordably. “We don’t want millions of vehicles on the balance sheet,” says Miller.
So it can go for option number two: Allowing companies to put their own self-driving cars on the Uber platform. Daimler announced it would do this in February 2017, thereby tapping into Uber’s most valuable asset: its experience connecting paying passengers with drivers—a skill that should transfer nicely to this new industry. The Toyota deal creates yet another path forward, wherein Uber licenses its tech to an automaker, which embeds it in its own vehicles and deploys them.
None of these plans are mutually exclusive, and for Uber, that’s a good thing. When you’re exploring a new world, looking for fortune, fresh ways forward are always welcome—as are friends to help you along.
1 Correction appended, 9/4/18, 5:35 PM EDT: This story has been updated to clarify that the vehicles deployed during Toyota's partnership with Uber will operate on Uber's ride-hailing network.