Cruise, Waymo push robotaxis amid doubts about self-driving tech

• If they can exploit that early lead by quickly scaling ride services across multiple cities, they have a chance to prove the economics of self-driving technology are viable and that it's not just an expensive science experiment.

Catch up quick: Other key players are shutting down, merging or paring back.

• Ford and Volkswagen last month pulled the plug on their autonomous vehicle joint venture, Argo AI.
• AV delivery startup Nuro laid off 20% of its workforce, and two leading AV tech suppliers announced a merger.
• Even Waymo's parent, Alphabet, is being pressured by an activist investor to reduce losses at its self-driving unit.

What they're saying: "Profitable, fully autonomous vehicles at scale are a long way off," says Ford CEO Jim Farley.

What's happening: Far from retreating, Waymo and General Motors-backed Cruise are hitting the accelerator.

• "We're going to continue to make sure we don't constrain the commercialization because we have the lead right now," GM CEO Mary Barra told investors last week.
• "Those who are writing that it's not going to work and that it's decades off haven't taken a ride in the vehicle — I mean, we're doing it right now."

What's next: After San Francisco, Cruise plans to expand robotaxi service to Phoenix and Austin, Texas, by the end of December.

• Several more cities are planned for 2023, and Cruise CEO Kyle Vogt said the company aims to hit $1 billion in revenue by 2025.

Waymo is expanding too, announcing that Los Angeles will be its third market (after Phoenix and San Francisco).

• Last Friday, California gave Waymo the go-ahead to transport passengers in San Francisco without anyone behind the wheel, although it still needs a separate permit to begin charging fares as it does in Arizona.
• Waymo is also unveiling a dedicated robotaxi co-developed with Zeekr, an electric vehicle brand owned by China's Geely Automobile Holdings.
• Meanwhile, another AV company, Motional, is partnering with Uber and Lyft to add Hyundai robotaxis to their ride-hailing fleets in several cities starting next year.

The big picture: This could be the beginning of an industry-wide shakeout in which the leaders pull away from the pack, similar to what happened in the auto industry in the first half of the 20th century.

• Back then, hundreds of automobile companies fell by the wayside, leaving only three: GM, Ford and Chrysler.
• Or, it could simply be that — unlike some others — Waymo and Cruise haven't run out of money yet.
• One big advantage Cruise has is a $5 billion line of credit from GM Financial, the automaker's lending arm, to fund expansion.
• Still, the pressure is on for both companies to prove they can make money on self-driving technology — and the only way to do that is by scaling up quickly.

Cruise's Vogt is bullish, despite what others are saying.

• "If you look at the underlying facts, you have people actually using driverless cars in major cities for the first time, multiple announcements of expansion, increasing fleet size, increasing metrics," he said in an interview.
• "Everything is up-and-to-the-right."

The bottom line: Vogt believes "we are in the golden years of AV expansion."

• "It's right in front of everyone," he tells Axios. "But I think it's one of those things that won't really be fully comprehended until a year or two from now — when AVs are practically commonplace and people are looking around and saying, 'Where did this come from?'"