Robotaxis are brutally expensive. This CEO wants to change it.

• Robotaxis have hit the main flow, with Waymo and Tesla planning large extensions in 2025.
• Concerns about the high cost of self-driving vehicles have led Ford and GM to come out of the race.
• May May Mobility Director Edwin Olson told Business Insider that Robotaxis are a “brutal” business.

Robotaxi wars have begun – but cost questions are already forcing some contenders to shake the white flag.

Ford and General Motors likes Robotaxis because they are a “brutal business”, Edwin Olson, CEO of the Autonomous Company of May Mobility, Business Insider told January.

Olson, who founded May in 2017, said the high cost of increasing autonomous travel services was making companies withdraw from robotaxis, with firms such as Waymo only expanded thanks to the mass books of controls of controls their big technology.

“Robotaxis are a brutal business. The hour’s income you can earn are probably $ 30 or more, and that falls out of peak hours,” he said.

“The income potential is low enough. You need to go to the much larger markets where you can direct the use of your wealth as high as possible so that you can approach as much Possible up to $ 30 per hour, 24 hours a day, seven days or Java.

The robotax industry has seen a dramatic expansion over the past year, with Waymo supported by Google 150,000 paid trips a week and Elon Musk discovered dedicated Tesla “Cybercab” robotaxi.

At the same time, the long-awaited arrival of self-driving cars has proven very expensive.

Despite its rapid growth, Waymo is not yet profitable, with the other “other bets” of the alphabet (which includes Waymo, as well as other subsidiaries) that lose $ 1.17 billion in the fourth quarter of 2024.

A recent McKinsey study found that robotaxis could cost about $ 8.20 per mile to run, and Bernstein’s analysts estimated that cars themselves can cost approximately $ 150,000 each.

Large price tags have already forced some players to leave the game.

Automakers Legacy Ford and General Motors have given up plans to build dedicated robotaxis, with GM drawing funds for Cruise Embatled Self-Direction, despite spending billions in the company. Cruise said at the beginning of February that she would rest about 50% of her staff.

“I think GM, Ford, they were watching all prices north of $ 10 billion. And they just decided, let’s call it one day,” said Olson, who previously worked in the Autonomous Ford vehicle unit .

“Even if the technology was perfect … They are still years, maybe a decade, from reaching the Breakven point. Meanwhile, they will continue to burn billions of dollars a year,” he said.

Waymo’s money advantage

A company that is less limited to before its inherited rivals automatically supported is Waymo. Starting the robotax is owned by Google Parent Alphabet, which led a round of $ 5.6 billion in October.

“That’s why Waymo is still here – they have essentially got the alphabet control book,” Olson said.

“I think people have a lot of confidence that they will be able to continue to cough cash, to delay only for profitability,” he added.

It can direct autonomous vehicle services in 10 cities across North America and Japan and has adopted a different strategy as it seeks to compete with Waymo.

The company is mainly focused on long -term public transport contracts with businesses and governments. Olson said the strategy offers much higher income potential than traveling and has enabled May to make money on almost all of its pages in the US.

“We probably have autonomous vehicles that would have the lowest price point,” Olson said. “We have brutally optimized this vehicle to operate in places where buses go, and this allows us to reduce the cost.” The total trace of May calculation was about one -third of its competitors, he added.

Olson said this has put it in a good position to finally enter the Robotaxi market this year, with the company set to place Robotaxis in the Lyft app in Atlanta in the coming months.

Saber Fallah, a secure professor and autonomy at the University of Surrey, told Bi that May’s access to prioritize public transport contracts can signal a more sustainable strategy for the beginnings of self-direction.

“Unlike robotaxis, which operate in very dynamic and unpredictable urban environments, autonomous public transport systems benefit from predetermined routes and structured operating conditions,” Fallah said.

“This level of predictability significantly reduces the complexity of autonomous direction, making the placement more feasible in the near term,” he added.

Running Robobuses has other advantages over the cut world of traveling. Michael Lenox, a professor of business administration at the University of Virginia, told Bi that robot firms like Waymo can find out that their borders have been squeezed while competition is heated.

“The advantage of public transit contracts is the ability to be the sole provider in a particular market, essentially becoming a monopoly provider,” Lenox said.

Tesla enters the race

Although Olson is convinced that May can get to Waymo, the company is also determined to fight Tesla’s close entry into the Robotaxi Business.

Elon Musk discovered less drive cybercab at a great Hollywood event in October and said Tesla plans to start a robotax service in Austin in June.

Olson said he was skeptical about the approach taken by Tesla, with Elon Musk’s company relying on the cameras and to direct her full self-direction technology.

“It is clear that you will eventually be able to do this simply using cameras … but this is not where camera technology is today,” Olson said. “Computer vision networks are simply not good enough to reach the level of reliability.”

Musk’s robotax ambitions can increase from his influence with President Donald Trump, with reports suggesting federal rules for cars drives can be one of the advantages of transporting new administration.

Despite the fear in some neighborhoods that Musk can use his position to increase his prospects at the expense of his rivals, Olson said his presence could help shock the “patchwork” rules about Robotaxis in SH.BA

“I think in general, given who is at the top, if they are able to push the new federal level regulatory standards, they are likely to be favorable to the AV industry,” Olson said.

Do you work in the robot industry or do you have thoughts to share? Contact this reporter at tcarter@businsinsider.com