Shares in Alphabet (GOOGL) were steady today despite a safety probe being launched into whether its Waymo robotaxis are safe to be driven around school buses.
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The National Highway Traffic Safety Administration (NHTSA) has launched an investigation into approximately 2,000 Waymo robotaxis operating in the United States.
Safety Incident
The agency has opened what it calls a “preliminary evaluation” to examine the performance of Waymo’s Automated Driving System (ADS) specifically regarding how these vehicles interact with stopped school buses.
It follows an incident where one of its autonomous vehicles failed to stop properly for a school bus in Atlanta.
The incident, which occurred on September 22, involved a Waymo 5th Generation Automated Driving System (ADS) vehicle that drove around a stopped school bus with flashing red lights and an extended stop arm while students were disembarking.
The investigation will focus on the autonomous vehicles’ behavior and response patterns when encountering school buses that have stopped to pick up or drop off students, a critical safety scenario on American roadways.
The NHTSA said the probe will also assess the broader safety performance of Waymo vehicles, which currently operate over two million miles per week.
Lessons to be Learned
This isn’t the first safety issue associated with Waymo. Back in May, Waymo recalled 1,212 autonomous vehicles after a software issue caused some cars to collide with roadway barriers. The issue affected vehicles running on Waymo’s older fifth-generation automated driving system (ADS) software.
In July, the National Highway Traffic Safety Administration (NHTSA) officially ended its investigation into Waymo, following a 14-month review of reported traffic incidents and unexpected vehicle behavior.
The closure came without any enforcement action. The probe was launched in May 2024 after the agency received 22 complaints linked to Waymo’s self-driving robotaxis.
Waymo runs commercial robotaxi services in a number of U.S. cities including San Francisco, Los Angeles, Phoenix, Austin, and Atlanta. It also plans to begin service in Miami and Washington, D.C., later this year.
Why it Matters
The investigation will obviously matter to America’s school kids and their parents, but it could also impact Alphabet stock. One of the key risks faced by companies engaged in innovative technology is legal and regulatory issues stemming from their use in testing or real life environments.
It is something the company and investors need to be aware of when putting their cash into the stock.
Is GOOGL a Good Stock to Buy Now?
On TipRanks, GOOGL has a Strong Buy consensus based on 29 Buy and 8 Hold ratings. Its highest price target is $300. GOOGL stock’s consensus price target is $259.40, implying a 2.41% upside.
