Did Tesla Just Say "Checkmate" to Waymo?

Waymo commercially launched before Tesla's robotaxi, but Elon Musk's electric vehicle (EV) empire might have the last laugh

Autonomous driving is emerging as one of the most exciting opportunities in the artificial intelligence (AI) landscape

Self-driving vehicles stitches together semiconductors, software development, and robotics

Hence, there are several different ways to invest in the nology

What most investors ly overlook is that Waymo and Tesla have apached building fleets of self-driving cars through different lenses

While Waymo has a first-mover advantage in scaling self-driving taxi fleets, some findings from the company's recent academic re paper titled "Scaling Laws of Motion Forecasting and Planning" could suggest that Tesla may have a nological edge

Let's explore Waymo's gress so far and assess why Tesla could be the superior autonomous driving opportunity in the long run

Not only is this a fivefold increase compared to last year, but Waymo's serviceable are still quite limited

For now, Waymo primarily operates in Austin, Texas, and has planned expansions in Washington, D. , and Miami over the next year

By contrast, Tesla just launched its long-anticipated robotaxi service in Austin a couple of weeks ago

Considering Waymo's successful early adoption rates, investors may be wondering how Tesla plans to close the gap against competitive forces

Image source: Getty Images

Did Waymo just quietly admit Tesla has an edge

There are several differences between how Waymo and Tesla have apached building self-driving car fleets

From a nical standpoint, the two companies have opposing views on variables such as mapping, sensors, and the compute power needed to train and hone AI models

Waymo's apach is grounded in simulating real-world environments and driving behaviors

By contrast, Tesla's general apach has been to use a data-heavy back loop from its actual drivers

Tesla vehicles are constantly collecting loads of sample data from drivers such as speed and braking patterns or interventions

Subsequently, Tesla trains and iterates its models on this large and expanding data set to imve its autonomous driving software platform and budding robotaxi fleet

In Waymo's re report, the company suggests that "collecting more data" could be advantageous when building and scaling autonomous vehicle platforms

Waymo goes on to say that "every 10 observed miles are equivalent to 2 to 3 demonstrated miles. " To me, these statements seem to suggest that building a sophisticated model alone is not enough to perfect autonomous vehicle software

Rather, collecting data at scale is a critical part of the equation

Furthermore, it appears that Waymo is saying that using large volumes of real driver behavior (i. , non-autonomous vehicle platforms) is important for training these models over time

Is Tesla stock a buy right now

At the moment, Tesla stock appears to be pricing in a lot of upside from the robotaxi launch

I wouldn't chase momentum at these valuation levels, per se

Tesla stock often trades on narratives, which smart investors know can change quickly

As a long-term investor, I encourage readers to think the bigger picture here

Self-driving cars are still a new, evolving nology and I do not personally think there is a single correct way to build and scale these platforms

Candidly, I don't see Waymo's study as some of veiled admission that Tesla's apach to autonomous driving is right and theirs is wrong

I simply think Waymo's takeaways subtly imply that Tesla's nological apach has some merit

What will determine who wins the autonomous driving opportunity will boil down to which company can acquire more customers, expand to new, strategically partner with existing ridehailing applications, and scale its fleets more rapidly and fitably

For these reasons, I do not think Tesla necessarily has Waymo is a checkmate position -- at least not yet

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors

Adam Spatacco has positions in Alphabet and Tesla

The Motley Fool has positions in and recommends Alphabet and Tesla

The Motley Fool has a disclosure policy.