Amazon is snapping up the driverless car maker Zoox for a deal estimated at a cool $1.2B. Zoox has spent the last couple years working on a robo-taxi.
We’ve been hearing about driverless cars for years now, but developing this technology is stupid expensive and challenging. Amazon CEO Jeff Bezos, with his seemingly bottomless bucket of cash, could help Zoox finally hit the road.
Amazon’s competition ain’t thrilled
Tesla CEO Elon Musk denounced the deal in a tweet, calling Bezos a copycat.
Tesla has been at the forefront of the driverless-car revolution, but it’s run into some roadblocks. (Musk is a frequent Bezos critic, and these 2 rich dudes are also embroiled in a space race — which might explain Musk’s indignation.)
This isn’t Amazon’s first foray into autonomous vehicles. Last year, it invested in Aurora Innovation, which develops tech for driverless cars.
Amazon also plans to buy a whopping 100k electric delivery vans from the truck startup Rivian. And there’s Amazon’s long-idling drone project, Prime Air.
Ride-hailing titans should check the rearview mirror
If the AmaZoox venture is successful, it could spell big trouble for Uber and Lyft.
Both spend millions annually recruiting drivers, and face regulatory pressure to classify them as employees in New York and California. An autonomous ride-hailing service from Amazon could have a big advantage in terms of overhead costs.
And Amazon could easily offer discounted fares to its 100m+ Prime members, giving plenty of passengers an incentive to switch services. With some analysts estimating the ride-hailing industry to hit $60B+ by 2023, Amazon would have nothing to lose.
