Waymo Enlists AutoNation to Service Some of Its Robovans
November 02 2017 - 07:59AM
Dow Jones News
By Adrienne Roberts
Autonomous cars may not need a driver, but they still need a
good mechanic.
Waymo LLC, the driverless-car unit of Google parent Alphabet
Inc., has signed up AutoNation Inc. to service robovans that are
being tested in Arizona and California. The agreement, announced
Thursday, shows the Silicon Valley tech giant is closer to
deploying vehicles on public roadways without humans behind the
wheel.
The agreement is separate from a June deal where Avis Budget
Group Inc. agreed to park Waymo vehicles at rental lots and do
routine maintenance, including oil changes, tire rotations and
cleaning. AutoNation, the largest dealership chain in the U.S.,
will provide mechanical and cosmetic repairs to Waymo's fleet.
Waymo is considered a leader in autonomous-car research and has
been transitioning to operating a fleet of hundreds of Pacifica
minivans built by Fiat Chrysler Automobiles NV that are retrofitted
with extensive software and other gear so the vehicles can drive
themselves. Waymo, which is competing with several auto makers in
the driverless car race, showed off new demonstrations of its
technology on Tuesday.
Auto dealers sell new and used cars but book a big chunk of
their profits on financing and servicing vehicles. Many of them,
including AutoNation, have been experimenting with ways to become
more relevant if car usage becomes more of a shared service and
people no longer need to be the primary driver of their car.
AutoNation has begun servicing self-driving vehicles in the
Phoenix area, where Waymo has launched a program that gives
hundreds residents free rides in the self-driving cars. Mike
Jackson, AutoNation's chief executive, said he has been making
regular visits to Waymo headquarters and realized his dealership
group could have a role in the commercialization of self-driving
vehicles.
"We're able to put in place the strategic maintenance and care
program for each vehicle that will proactively make sure it's
always operating at the highest safety levels and will optimize the
life cycle of the vehicle," Mr. Jackson said in an interview.
In a statement, Waymo Chief Executive John Krafcik said the two
companies have "a shared vision of enhancing the in-car experience"
and AutoNation will help to ensure "Waymo vehicles are always in
top condition as we bring fully self-driving cars to the
public."
"This is additional business for us," said Mr. Jackson. "I
believe Waymo is going to grow--I think they have the right
approach and we're going to grow with them."
AutoNation said its technicians have the expertise to maintain
and repair the vehicles but as the partnership grows, they will
hire more technicians to meet demand.
The Waymo deal is a part of a broader AutoNation effort to
reduce its dependence on low-margin new car sales. In the last
quarter, it opened "AutoNation USA" used-car centers and expanded
into branded car parts, auctions and collision centers.
Separately, AutoNation said its quarterly net income from
continuing operations fell 9.5% from a year earlier to $1.00 a
share, beating analysts' expectations by 16 cents. Revenue fell
2.7% to $3.2 billion.
Same store used-vehicle gross profit was up 9% from a year
earlier.
Write to Adrienne Roberts at Adrienne.Roberts@wsj.com
(END) Dow Jones Newswires
November 02, 2017 07:44 ET (11:44 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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