Valley Metro is paying up to $200,000 for a partnership with Waymo that will test how to use self-driving cars to deliver people to bus stops and light-rail stations.
Between 30 and 50 Valley Metro employees — who haven't yet been selected or signed up — are expected to take part in the program. They'll be shuttled by self-driving vehicles to and from transit access points, then take a bus or light-rail to work or other destinations, before reversing the process later in the day.
Waymo stands to earn billions in profits from its autonomous robo-taxis in the next few years, but Valley Metro, which runs the regional bus and light-rail services, is sharing the costs of the experiment. Transit officials say the project is worth the money because it will help show the impact autonomous vehicles could have on the public transportation system.
The money, which comes from transit users, was approved unanimously by Valley Metro's board Tuesday.
Valley Metro is sharing costs with Waymo since "both of us stand to benefit because of what we're able to learn," said Lauren Tolmachoff, Valley Metro board chair and vice mayor of Glendale. "AVs are going to be the future of transportation. I think we have a responsibility to find out whether this will work, and how it will work."
The research will focus on how autonomous vehicles help people complete the so-called "first and last mile" of a trip that involves public transit, and assumes that more people would use transit only if they could get a cheap ride to the nearest bus or light-rail station.
Valley Metro staff said the funds will help pay the costs of the initial three-month program, which begins this month, but that any leftover money could be spent within the next two years. Rob Antoniak, Valley Metro chief operating officer, was not able to estimate exactly how or when the money would be spent. But he said that in general, it would cover transit fares, research costs, and fees or costs paid by participating employee-riders. Some of the money will be paid directly to Waymo.
The company, a subsidiary of Google parent Alphabet, has invested more than $1.1 billion since 2009 in its quest to be the premier self-driving vehicle company. Observers say the company appears to be way ahead of other companies producing autonomous vehicles like Ford, GM, and of course, Uber, which tested its vehicles widely in metro Phoenix until five months ago, when one of them struck and killed a pedestrian in Tempe.
Waymo followed up on its Early Rider program, which reportedly has 400 daily riders, and a partnership with Walmart announced last week, by announcing the partnership with Valley Metro on Tuesday during a high-profile event at the light-rail maintenance station in Phoenix.
Valley Metro CEO Scott Smith and Waymo told the crowd of local politicians and dignitaries that the transit agency had been looking to partner with an autonomous vehicle company for more than a year, finally settling on Waymo because it was already testing vehicles in the "real world."
"Employees will basically be the test crew" riding with Waymo to other transit points, Smith said. The agency will eventually figure out how to meld the program with Valley Metro's Ride Choice program, which offers a taxi service at heavy discounts to senior citizens and disabled people. All the while, the agency and Waymo will gather and share data on all aspects of their partnership.
"This is a laboratory – we're going to see how this progresses as we go," Smith said.
One goal of Waymo's is to make sure the cost of riding in a self-driving vehicle for that "first" or "last" section of a trip — from a person's home or office to a transit point — will be much cheaper than using a taxi or ride-sharing service like Uber of Lyft to do the same thing.
Smith, in a later interview, told Phoenix New Times that he expects to see a "seamless" service in the future, in which riders would pay one small fee that would include the fare for an express bus or light-rail ride, as well as the fare of the short-trip self-driving vehicle that drops off, and later picks up, the rider. While Uber might charge $30 or more for a ride of a few miles in a very busy area, a combo transit-and-autonomous-vehicle ride might only cost "$3 or $4" for a one-way trip.
However, the subject of how much a Waymo ride might cost, when the service finally goes commercial, is a sensitive one with the secretive company.
So far, Early Rider rides have been free, but a Bloomberg.com article this week revealed that a ride-hailing phone app created by Waymo "offers the first indication of Waymo’s early experiments with pricing." The app listed a price of $19.15 for an 11.3-mile ride, for example, Bloomberg reported, adding that the price was cheaper than a taxi but similar to that charged by Lyft or Uber.
But Waymo told Bloomberg that the app "does not reflect the various pricing models under consideration."
Shaun Stewart, Waymo's new chief business development officer, fled from New Times at Tuesday's event when asked what the price point of Waymo's ride-hailing service might be. Other Waymo representatives declined to talk about the possible price of rides in Waymos.
The company continues to claim that it will roll out a commercial ride-hailing service with autonomous vehicles by December that will be fully driverless. Waymo lists its four primary goals as "creating a ride-hailing service, developing self-driving trucks for logistics, licensing with OEMs for personally-owned vehicles, and connecting people to public transportation."
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However, despite a recent announcement that Waymo autonmous vehicles have driven 8 million miles on public roads, with much of that on metro Phoenix roads, the public has seen little evidence that the company has conducted widespread testing in the area of fully driverless vehicles.
As with the "Early Riders," Valley Metro employees who participate will be asked to sign nondisclosure agreements.
The Valley Metro partnership will initially involve riders who live in the east Valley, where Waymo's been doing most of its testing. Most or all of the vehicles being used will employ backup drivers instead of going fully driverless.
Smith said that Valley Metro's risk management team is "confident in the Waymo technology," adding that, "We've managed the risk, and shared the risk with Waymo in a way that we both feel comfortable."