(Bloomberg) -- Waymo is teaming up with Jaguar Land Rover on autonomous vehicles, its second major automaker partnership and a big boost for the nascent technology that has come under scrutiny recently.
Under the accord, Alphabet Inc.’s Waymo will integrate its self-driving system into Jaguar’s I-Pace electric SUVs, the first all-electric offering from the luxury unit of Tata Motors Ltd. Jaguar will start delivering I-Paces to Waymo for testing starting in 2018. Starting in 2020, as many as 20,000 of the vehicles will join Waymo’s ride-hailing taxi service.
“It ended up being a really terrific next vehicle for us and fit one of the key aspects of our business plan,” John Krafcik, Waymo’s chief executive officer, said in an interview. “We can get closer to getting just the right car for just the ride that person has requested.”
Waymo, which has racked up the most autonomous test miles on roads, is eager to work with more car companies to bolster its lead as it prepares to launch a commercial ride-hailing service. The companies didn’t disclose financial terms, but Waymo is planning to purchase the I-Pace vehicles, which sell for $69,500. That would place Waymo’s payment for the deal at more than $1.3 billion.
Jaguar CEO Ralf Speth said he’d already “ringfenced” the 20,000 I-Paces for Waymo.The vehicle will go on sale to the general public in the U.S. toward the end of this year. He emphasized the partnership as a way for Jaguar to embrace new forms of transportation while preserving the thrill of driving that attracts new-car buyers.
“It’s offering the right car, the right mobility for the right situation,” Speth said at an event in New York announcing the deal. “If you sit in a traffic jam, you can do far more with your valuable time. But you also want to have the steering wheel to have the excitement of driving again. This is the kind of spectrum we want to offer our customers.”
A self-driving car from Uber Technologies Inc. hit and killed a pedestrian last week, which stunned the industry and kicked off a debate about the technology’s capabilities on open roads. On Saturday, Krafcik said he was confident that Waymo’s technology would have avoided the crash.
After courting major automakers for years, Waymo, the former Google self-driving project, inked its first deal with Fiat Chrysler Automobiles NV in 2016. Waymo then deployed Chrysler Pacifica minivans in its tests cities and, in January, said it was buying “thousands” of the vehicles ahead of its commercial taxi service debut.
The Jaguar vehicles, like the Pacficas, will bear the Waymo logo and be part of its coming ride-hailing network. Yet Krafcik insisted that Jaguar has a financial stake in the deal. “It’s a real partnership,” Krafcik said. “You’ll see aspects of that going forward.”
In September, Bloomberg reported that Jaguar Land Rover was weighing purchases of technology companies that could boost its efforts to roll out electric vehicles and autonomous driving systems. In June, the automaker said it had invested $25 million in Lyft Inc. as part of a funding round that closed in April. The company also said it’s working with Lyft on autonomous-driving technology and will offer vehicles for rent to the San Francisco-based startup’s drivers. Waymo has also announced a partnership with Lyft.
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