By Uber Technologies Inc (NYSE: UBER) chief executive Dara Khosrowshahi agrees self-driving technology could mean uncertainty for the ride-hailing giant.
But what it also means for the company is a huge opportunity, he told CNBC in an interview on Wednesday. CEO Khosrowshahi expects autonomous vehicles to eventually be a trillion-dollar market in the US alone.
And Uber sits right at the heart of that TAM – in fact, the self-driving technology may not be able to fully realize its vision without Uber Technologies Inc, he argued on “Squawk on the Street”.
Uber stock is down nearly 10% this morning after coming in significantly shy of earnings estimates for its fiscal fourth quarter and offering what can only be described as muted guidance for Q1.
Why is Uber central to AV commercialisation?
Uber chief executive Dara Khosrowshahi says commercialisation of autonomous vehicles will likely prove to be a tall order – and require the following four ingredients:
- Regulators must start to feel comfortable with the self-driving technology
- Autonomous tech must deliver a safety record that’s several times better than humans
- OEM’s must expand capacity to mass produce self-driving cars affordably
- Autonomous vehicles must have very high utilization as they are expensive to build
He’s convinced that it will take time for the US to achieve all four and even then, the only way this commercialisation will realize is through a collaboration between Uber and the AV industry.
Versus its record high in October, Uber stock is down more than 25% at writing.
Uber opens interest list for robotaxi service in Austin
Also on Wednesday, the ride-hailing giant started inviting users in Austin, Texas to join its “interest list” for the upcoming Waymo robotaxi service.
Users on its interest list will be among the first to experience autonomous rides in Austin.
Joining the list will keep them updated and increase their chances of being matched with a Waymo self-driving vehicle upon launch.
Uber saw an 18% increase in its mobility as well as delivery gross bookings in the fourth quarter.
The New York listed firm generated a total of $11.96 billion in revenue – well ahead of $11.77 billion that experts had forecast.
Shares of Uber Technologies do not currently pay a dividend, though.
Should you buy Uber stock on the post-earnings dip?
Evercore ISI analyst Mark Mahaney shares CEO Dara Khosrowshahi’s view on what autonomous vehicles could mean for Uber Technologies Inc.
Uber stock will be a “long-term positive derivative” as it will emerge as the “ultimate demand aggregator” for self-driving cars, he noted in a recent report.
Heading into Uber’s earnings print, Wall Street had a consensus “buy” rating on the ride-hailing stock.
Analysts see upside in UBER to $89 that indicates potential for about a 40% gain from current levels.
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