Key Takeaways
- Waymo reportedly plans to grow its fleet from about 4,000 cars to 20,000 by the end of 2027, and some of those cars are Chinese-made vehicles that face steep tariffs.
- Early Uber investor Jason Calacanis predicts Waymo will buy Lucid or Rivian to get a US-built car, but a buyout looks like a long shot.
- Alphabet could easily afford either company, though Lucid burned $3.8 billion of free cash flow in 2025 and both automakers have already promised vehicles to Uber’s robotaxi plans.
- Hyundai’s Georgia-built IONIQ 5 robotaxis for Waymo are due to start arriving in the fourth quarter, so watch those deliveries and whether Waymo reaches 8,000 cars by year-end.
Alphabet (GOOG) wants a lot more robotaxis on the road, and it wants them fast.
Waymo has about 4,000 cars today. It plans to reach 8,000 by the end of this year and 20,000 by the end of next year, Semafor reported on Monday, citing people familiar with the matter. That’s five times today’s fleet in a little over a year.
Some of those cars are coming from China. The New York Post reported that Waymo has ordered thousands of Chinese-made cars for its US fleet, which has stirred up security concerns on Capitol Hill.
Early Uber (UBER) investor Jason Calacanis didn’t mince words on X:
“Technically not illegal today, Waymo just needs to pay 100%+ tariff on these cars… but obviously something they need to deprecate because it’s not cost effective and the optics are really bad.”
AI researcher Joscha Bach replied that Waymo already fits its self-driving tech into those cars at its own US factories. In his view the hard part is the car itself, and matching Tesla (TSLA) on cost: “Waymo cannot build electric vehicle platforms that are cost competitive with Tesla in the US.”
Calacanis’s answer? “They will buy Lucid or Rivian.”
(For what it’s worth, Calacanis said last month that he’d bought small positions in both Lucid and Rivian. He called them “tiny bets” and said he expects both to be bought out within two years.)
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The car is the bottleneck
The clock on Chinese-made cars is already running. US rules restrict certain Chinese software, and sales by Chinese-controlled automakers, starting with model year 2027 vehicles. Limits on certain Chinese connectivity hardware follow from model year 2030.
Waymo can handle fitting its tech into the cars. It’s scaling up its factory in Mesa, Arizona, toward capacity of tens of thousands of vehicles a year.
So Waymo needs another source of cars, and soon.
Alphabet can afford either one
Money isn’t the issue. Alphabet’s capital spending nearly quadrupled from 2021 to 2025, to $91.5 billion.
Rivian and Lucid put together are worth less than a third of that. And Waymo has money of its own. It raised $16 billion of equity this year, then borrowed $5 billion this month without guarantees from Alphabet.
Rivian is the one that makes sense
If Waymo does go shopping, Rivian (RIVN) is the stronger business to buy. Analysts expect its revenue to nearly triple from 2025 to 2028 as the R2 ramps up.
Uber has already signed Rivian up for 10,000 autonomous R2 SUVs. Rides are expected to start in San Francisco and Miami in 2028, and Uber has an option for up to 40,000 more vehicles from 2030. Uber also plans to invest up to $1.25 billion in Rivian through 2031 if it hits certain autonomy milestones.
Lucid (LCID) has a similar Uber deal and a much bigger cash problem. Uber has committed to buy at least 35,000 Lucid vehicles for a robotaxi service it’s developing with Nuro, and its investment commitments in Lucid total $500 million.
But Lucid has burned cash every year since 2021, including $3.8 billion in 2025.
That one year’s burn is more than Lucid’s entire market value today.
Hyundai already builds Waymo a US car
Plus, Waymo doesn’t need to own an automaker to get American-made cars. Hyundai Motor (005380) told investors last month that the first IONIQ 5 robotaxis for Waymo will be delivered in the fourth quarter, assembled at its plant in Georgia.
Buying cars from a big automaker means no cash-burning company to fund and no Uber contracts to untangle.
Hyundai has never said how many cars it will supply, though, so Waymo may want more than one source to get to 20,000.
Don’t bet on a buyout
So will Waymo buy Lucid or Rivian? I wouldn’t count on it. Waymo clearly needs US-built cars, and Alphabet could buy either company without blinking. But Hyundai’s Georgia line already gives it a cheaper path, and both automakers are busy building for Uber. If a deal does happen, I’d expect Rivian, with its revenue growing and the R2 coming.
My take: Waymo can probably fix its car problem without a big acquisition. For Alphabet shareholders, hitting 20,000 cars matters far more than whose factory they come from.
Of course, that could change quickly if Hyundai’s first deliveries this quarter are slow, or if Waymo’s fleet falls well short of 8,000 by year-end.
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