Waymo Expands Self-Driving Operations. What It Means for Tesla.

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Truly self-driving cars are on American roads. And they don’t come from

Tesla
.
Consumers—and investors—just need to know where to look.

Waymo, Alphabet’s (ticker: GOOG) venture into self-driving cars, said Tuesday it has begun testing its autonomous ride-hailing service in San Francisco. Waymo already operates a robotaxi business around Phoenix. The Arizona taxis have operated without people at the wheel since October 2020, so they qualify as true self-driving vehicles.

The San Francisco Waymo program, at this point, is a test, with autonomous-driving specialists in the cars. Riders are preselected—people can sign up here— and give the company feedback about the experience of being driven around the city’s winding roads.

Travelers can also get into a self-driving taxi in Las Vegas. That network is operated by Motional–a joint venture between the auto-parts maker

Aptiv

(ticker: APTV) and

Hyundai Motor

(005380. Korea).

It has taken the auto industry a while, but fully self-driving vehicles are starting to pop up across the country.

There is still a big difference between the self-driving ride-hailing franchises operated by Waymo and Motional and autonomous-driving systems available to new-car buyers. The ride-hailing vehicles have sensors and software that can cost hundreds of thousands of dollars, putting it out of reach of regular consumers. These vehicles have to generate revenue to justify the cost.

The autonomous-driving features available for purchase on passenger cars can do some of what a Waymo self-driving taxi can, but those systems require drivers to pay attention to the road 100% of the time.

Tesla (TSLA) is more vocal than most other auto makers about its self-driving features. The company hosted an investor event this past week to show off he progress it has made.

The race to develop better, cheaper systems for passenger cars is important for Tesla and its competitors. Better systems will mean safer, more convenient vehicles. That will allow Tesla, or whoever develops the leading systems, to sell more cars.

Tesla stock isn’t reacting much to the Waymo news. Shares were up 0.4% in early trading Wednesday. The

S&P 500
was flat and the

Dow Jones Industrial Average
slipped 0.1%. Stock in

Alphabet

was up 0.4%.

Write to Al Root at allen.root@dowjones.com