Waymo to build self-driving cars near Detroit

Waymo, which in December launched the nation's first paid robotaxi business, is taking the next step toward commercialization with a deal to assemble self-driving cars at a new factory in Michigan.

Why it matters: Detroit frets constantly about Silicon Valley usurping its claim as the current and future home of the auto industry. But it turns out the Motor City, with its deep talent pool, is the perfect place for Alphabet's self-driving vehicle unit to assemble its futuristic cars.

What's new: Waymo said yesterday that it plans to invest $13.6 million to open a factory in southeast Michigan.

• This will create at least 100 jobs, potentially reaching 400 new positions for engineers, operations experts and fleet managers.
• The company will receive a grant of up to $8 million from the Michigan Economic Development Corp., if it meets the 400-person hiring target.
• That would equate to $20,000 in state aid per job, per Reuters.
• Waymo doesn't build cars, so it partnered with Magna, a giant auto supplier with loads of experience as a contract manufacturer, to integrate its self-driving technology into FiatChrysler and Jaguar vehicles.

The big picture: Waymo has deals to buy up to 62,000 Chrysler Pacifica minivans and 20,000 Jaguar I-Pace luxury crossovers for its robotaxi service. It also has agreements with Avis and AutoNation to provide maintenance and fleet management services.

Yes, but: So far, Waymo has just 600 vehicles in its fleet, with most of them still in testing mode. CEO John Krafcik has said the company plans to expand its fleet to as many as 20,000 vehicles by 2022, which seems like a stretch, given the slow roll of AV progress today.

Go deeper: Waymo obtains California permit for fully driverless testing