Waymo's robotaxi expansion will get a Lyft in Nashville next year

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Robotaxi leader Waymo on Wednesday announced that its driverless vehicles will begin transporting passengers in Nashville, Tennessee, next year while heading in a new direction by teaming up with Lyft instead of its recent ride-hailing partner Uber.

The Nashville plan calls for robotaxi ride requests to initially be limited to Waymo's own mobile app before expanding on to Lyft's app later next year.

Waymo's decision to work with Lyft in Tennessee's biggest city means its robotaxis will now be available on the apps of the two largest ride-hailing services in the U.S.

As part of earlier expansions, Waymo is already dispatching robotaxis through Uber's app i n Atlanta and Austin, Texas. Electric automaker Tesla has been testing a limited driverless service in Austin in an attempt to fulfill an ambitious plan that CEO Elon Musk has been pursuing for the past decade.

Even if it's in only one city, getting Waymo's industry-leading robotaxis on its app could help Lyft continue its recovery from the pandemic restrictions that decimated demand for rides. Uber bounced back from the pandemic more quickly, a comeback that has been reflected in both its financial results and market value, which has tripled since the end of 2019.

Lyft's stock price, in contrast, remains nearly 50% below where it stood at the end of 2019. As part of its turnaround efforts, Lyft hired former Amazon executive David Risher as its CEO two years ago. Risher previously negotiated a partnership with May Mobility that is now providing driverless rides in Atlanta in competition with Waymo and Uber.

Investors interpreted the Waymo partnership as a positive sign for Lyft, whose shares surged 13% Wednesday to close at $22.84.

This is not the first time that Waymo and Lyft have worked together. During the testing phase of its robotaxi service in Phoenix in 2019, Waymo offered a limited number of rides through Lyft. That arrangement ended after Waymo completed the Phoenix tests and began accepting driverless rides from all interested passengers on its own app more than five years ago.

Since starting in Arizona, Waymo's robotaxis have provided more than 250,000 trips in cities from the San Francisco Bay Area to Los Angeles, as well as Austin and Atlanta. Waymo, which began in 2009 as a secret project within Google, also plans to expand into Dallas next year.