Waymo partners with Avis Budget to manage self-driving fleet

Cheryl Sanders
June 27, 2017

Waymo, the self-driving auto affiliate of Google, has reached an agreement for Avis Budget Group Inc.to manage its fleet of autonomous vehicles.

"With members of the public using our growing fleet of self-driving cars, our vehicles need standard maintenance and cleaning so they're ready for our riders at any time of the day or night", said John Krafcik, chief executive officer, Waymo.

Avis has a system of cleaning and maintaining cars, including basic services like oil changes and tire changes, that it can provide for self-driving vehicles.

The stock price for Avis Budget Group, the parent company of companies including Avis and Zipcar, jumped to a high of $29.14 per share on news of the partnership. Waymo recently announced that it is adding hundreds of Chrysler Pacifica minivans to build a 600-vehicle fleet.

Larry De Shon, president and CEO of Avis Budget Group, said the arrangement allows Avis to accelerate its "knowledge and hands-on experience in an emerging area".

Waymo won't comment on whether the partnership includes plans to expand beyond Phoenix, but it's easy to see how Alphabet could incorporate other locations into its autonomous ride-hailing effort based on Avis locations. Even with today's rally, Avis has declined 45 percent during the past three years, partly because of the threat that ride-sharing companies like Uber and Lyft pose to traditional car-rental companies. Waymo will maintain ownership of the vehicles and pay Avis for its service.

Avis locations will be reworked to accommodate Waymo's vehicles without acquiring additional space. Instead of selling autonomous vehicles directly to the public-which will happen eventually-operating the fleets themselves means they can be commercially insured, solving (for the time being) one of the big unanswered questions about the evolving technology.

Because the partnership is nonexclusive, Avis will be free to partner with other self-driving manufacturers, and Alphabet will be free to work with other rental services.

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