Amazon’s Zoox jumps into Robotaxi races with Las Vegas launch

Five years after Zoox’s $1.3 billion acquisition, Amazon Officially participated in the US Robotaxi race, but has been dominated so far alphabet Waymo.

Zoox’s first public release begins Wednesday on the Las Vegas Strip. The company offers free rides from several hand-picked locations and plans to expand more widely across the city in the coming months. The riders will have to pay in the end, but Zoox said they are waiting for regulatory approval to take that step.

Amazon is jumping into all markets of the future, but Waymo has made a major start and has been offering commercial driverless rides since 2020. Earlier this year, Waymo exceeded 10 million paid rides and currently operates in five cities, along with Dallas, Denver, Miami, Seattle, Seattle, Washington and DC.

TeslaMeanwhile, in June, they began testing limited Robotaxi services in Austin, Texas, but human supervisors were on board.

However, unlike Waymo and Tesla, Zoox’s electric Robotaxi doesn’t look like a car. There are no handles or pedals. The rectangular shape has led many people in the industry to describe it as a toaster of the wheels. “I’m using Robotaxi or Vehor or Zoox,” says Jesse Levinson, co-founder and technology chief of Zoox.

“You can put shoes on what was a Robotaxi car. That’s not the ideal solution,” Levinson told CNBC in an interview in Las Vegas. “We wanted to put that effort into it, spend the time investing in it, then bring something much better than a car into the market.”

Zoox was founded in 2014, five years after Google formed the project that became Waymo. Following Las Vegas, the company said it plans to debut its early rider program in San Francisco by the end of the year. The company is testing a fleet of 50 Robotaxis in San Francisco and Las Vegas.

Austin and Miami will be the next location for Zoox, the company said. Zoox said it will soon begin testing the Robotaxis in those markets, and is already pushing for modified test vehicles in Los Angeles, Atlanta and Seattle.

“We think it’s a very, very early age and the future is not yet written,” Levinson said during a demo ride with CNBC.

Zoox’s Las Vegas Depot covers 190,000 square feet. This is the size of three soccer fields. At the facility, the company houses dozens of vehicles set up to get into operation in the city. Smartphone users can order from Top Golf, Area 15, Resorts World Las Vegas, New York New York Hotel & Casino, and Luxor Hotel & Casino.

Robotaxi has two rows of seats facing each other, allowing up to four people at a time. The front and rear are identical, allowing the two-way wheels to move forward or backward without changing direction. The vehicle can run for 16 hours on a single charge.

Floor-to-ceiling windows provide a tourist experience for passengers who want to clearly see the endless rows of casinos. However, interior design is intended to allow for easy conversations with fellow riders.

“It’s not a renovated car,” said Aichia Evans, CEO of Zoox. “It’s built from scratch around the riders.”

CNBC interviewed Evans at Zoox’s headquarters in Foster City, California.

In addition to offering a unique variety of vehicles, Zoox takes a very different approach to Waymo, which has worked with automakers such as Chrysler, Jaguar and Hyundai.

Zoox reflects the vision of Australian entrepreneur co-founder Tim Kentley-Klay, and later founding an artificial intelligence robotics company. Kentley Clay, who has a marketing background, first traveled around Silicon Valley to learn about self-driving cars by interviewing experts in early disciplines on the premise that he was a filmmaker working on related projects.

For technical expertise, Kentley-Klay worked with Levinson, who worked on autonomous driving technology at Stanford University. Levinson’s father is apple Arthur Levinson, chairman and former CEO of Genentech.

Kentley-Klay and Levinson decided not only to modify the car so they could drive them themselves, but also to build a car of the future. Neel Mehta, former Autos analyst at Morgan Stanley, signed up to join them in 2016 when Zoox was still in stealth mode.

“If you have a completely autonomous vehicle, why do you need a steering wheel?” said Mehta, who ran multiple teams in five years at Zoox, including corporate strategy.

It was a tedious process.

While rivals adopted existing models and added sensors and software, Zoox used 3D printers to create whole new car parts, people familiar with the issue said. People said that when challenges arise and employees proposed a different approach, Kentley Clay and Levinson refused to shake up.

However, Kentley-Klay was expelled in 2018. Earlier the following year, Zoox brought Evans. IntelHe began as a chipmaker in 2006 as a test manager.

“I had a job, I had good life, so I had so many other opportunities,” Evans said. “It was a choice, a very intentional choice, and Jesse was part of that choice.”

Evans is much more corporate, refined and a little more familiar than her predecessor, said someone with knowledge of the matter. But the addition of the bureaucracy has created organizational skills to help the company mature, the two said. Sources were asked not to name them as they were not allowed to talk about the company.

Evans said her goal is to bring together Zoox experts in computing, cloud and robotics.

“It’s a big vision. You won’t be there overnight,” she said. “So how do we break it down? What do we have to prove? In what order?”

Within Amazon, Zoox falls into the vast device and services business led by the former Microsoft Executive Panospanai. This category includes everything from Alexa and Kindle to Project Kuiper on Internet Satellite Business.

Zoox continues to function primarily as an independent subsidiary, said the two people familiar with the issue. The leadership team continues as is, unlike some of Amazon’s acquired businesses, including Whole Foods, One Medical, and Pill Pack.

“It’s been five and a half years and we’re way beyond the dating period,” Evans said. “Their expectations are very reasonable. Do what you’re trying to do. And when you do it, it’s great.”

Leadership is still meticulous.

In honor of Zoox’s anniversary in July, Amazon CEO Andy Jassy and other executives visited headquarters, people present said. The mood was a celebration, and Jussy congratulated his employees on the success of Zoox so far, the person said.

Prior to its launch, Zoox had been testing its technology in Las Vegas since 2019. The Robotaxi test began in 2023, and in late July it began offering demo rides to Curios audiences at Resorts World.

Zoox chose Las Vegas due to the fact that drives to the airport do not need to go to the highway due to the large number of tourists nearby the strip.

Russell James, 68, was an early tester.

James, who lives in San Francisco, is unfamiliar with Robotaxis. He said he often rides Waymos when he is home and prefers the privacy of unmanned cars.

“It does what you want to do,” he said. “It’s going to pick you up and take you where you want to go.”

In June, on one of his frequent trips to Las Vegas, James said he took a friend with him on an offer to do an early Zoox ride.

There was a hiccup.

The first vehicle that the staff summoned for him at Resort World was not entirely billed, he said. After three more people stood up, James was instructed to jump into a car that still had enough battery power left. (During CNBC’s visit to Las Vegas last week, all cars that rose to grab passengers were billed.)

James said, as a tall man, he thanked the size of the car.

“I usually have to scrape my head off,” he said. “That wasn’t there.”

James compared the experience to “a streetcar that takes you between terminals at the airport.” He described his short loop around the resort as calm. “It’s exactly what you want.”

But not all of Zoox’s vehicles are out of nowhere.

In April, a non-vacant Zoox in Las Vegas collided with a car that Levinson said was “driving a little irregular.”

It was a small crash fall and no one was injured. However, after checking the log files, Zoox decided that the vehicle could handle the situation better, Levinson said. The company has briefly stopped its vehicle in Las Vegas. In May, Zoox recalled 270 vehicles to address a software flaw in its ability to predict the movement of other road users.

A few weeks later, Zoox ordered another software recall after one of the Robotaxis was hit by an e-Scoater rider in San Francisco. The Robotaxi stopped during the collision, but then began moving to complete the turn.

“We are happy to admit that it’s not perfect, so whenever we find opportunities to improve our software, we take those opportunities,” Levinson said.

In the short history of the Robotaxi industry, safety has been a major challenge.

Before Uber sold its AV division in 2020, one of its test cars collided with a pedestrian in Tempe, Arizona, and killed it in 2018. General Motors said it would no longer fund its cruise division in December. Cruise’s Robotaxi business got caught up in a scandal in 2023 after dragging one of the women who were knocked onto the road at 20 feet in San Francisco.

“Our bars are not perfect, they’re significantly safer than humans,” Levinson said. “Our safety records up to now are very consistent with being significantly safer than humans.”

Levinson said Zoox will start with free rides and turn his attention to creating a business before revealing that.

“Obviously there’s a way to do that, otherwise it’s pointless to have Zoox,” Levinson said. From a profitability timing perspective, Levinson said, “Not weeks from now, not decades from now.

A more pressing priority is scale. Earlier this year, Zoox opened a vast manufacturing facility in Hayward, California, from its headquarters across San Francisco Bay.

The site currently produces one vehicle a day, but the company says it will ultimately reach around three Robotaxis per hour, or 10,000 a year, if full-scale. Waymo says there are currently more than 2,000 vehicles in its commercial fleet.

Sam Abuelsamid, vice president of market research at Telemetry, said that considering the large cost of building and operating Full Robotaxis Services, “it will happen at least in 2030 or later before these businesses actually make profits.”

Amazon insists it is willing to become patient. The company has poured billions of dollars into Zoox since its acquisition in 2020, showing the public what’s in store in the end.

“One of the things Amazon feels like it’s not getting enough credibility is that it’s really good at picking big long-term bets and actually making them happen,” Evans said. “We’re, yes, this is real and it shows that it’s coming to you.”