Article at a GlanceIn July 2026, Waymo, the leading robotaxi company, notified Uber that it would end their exclusive partnership. Behind Waymo’s decision to part ways with the largest mobility platform despite absorbing trillions of won in losses is its strategy of “selective vertical integration.” Under this approach, Waymo directly owns its autonomous driving system and customer touchpoints while outsourcing vehicle manufacturing and operations. That is because, in the autonomous driving era, competitiveness depends not only on the technology itself but also on who controls the customer touchpoints where relationships and data accumulate. A closer look at Waymo’s business structure shows that the robotaxi industry is also evolving toward a division-of-labor model similar to the traditional taxi industry, in which licensing, ownership, operations and maintenance are separated. This suggests that for Korean companies, rather than focusing solely on developing autonomous driving technology in-house, it may be more effective to use their existing manufacturing and operational capabilities to secure advantageous positions in the value chain. In Korea, where fares are relatively low, a realistic alternative may be to target unmet demand that existing taxis fail to serve, such as late-night hours and transportation-underserved areas, rather than simply offering a “cheaper taxi.” Policy should likewise be designed to incorporate driverless transportation services into the existing taxi licensing system rather than dismantling that system.
Why Did a Loss-Making Company Abandon Its Largest Distribution Channel?On Feb. 2, 2026, Waymo announced that it had raised a new round of funding. The company raised $16 billion, or approximately 22 trillion KRW. The round was led by prominent Silicon Valley investment firms including Dragoneer Investment Group, DST Global, and Sequoia Capital, valuing Waymo at $126 billion, or approximately 174 trillion KRW.
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In other words, a driverless taxi company was valued at more than the combined market capitalization of Hyundai Motor Company and Kia.
Two days later, on Feb. 4, Waymo’s parent company, Alphabet, filed its annual report with the U.S. Securities and Exchange Commission (SEC). The report included the 2025 results of Other Bets, the segment that includes Waymo. The segment generated $1.537 billion in revenue and posted an operating loss of $7.515 billion, meaning it spent nearly five times as much as it earned.
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Because Alphabet does not disclose Waymo’s financial results separately, no one knows exactly how much of that loss was attributable to Waymo. Analysts estimate the figure at roughly $4.5 billion to $5.6 billion, or 6 trillion to 8 trillion KRW.
In the first week of February 2026, the market valued Waymo’s business at 174 trillion KRW, even as the business was estimated to be losing more than 6 trillion KRW a year. Of course, this is a familiar picture for an early-stage growth company. But five months later, Waymo announced a strategy that was difficult to understand at first glance. On July 24, Waymo notified Uber that it was ending their partnership. Waymo decided not to renew the exclusive agreement under which its service was available only through the Uber app in Austin and Atlanta when the agreement expires in January 2028, and instead to operate independently through its own app thereafter.
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There had already been signs of the split. A month earlier, the partnership in Phoenix, the first market where the two companies had worked together, came to an end.
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With this notice, the two companies’ three-year honeymoon was effectively over.
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