Waymo -- Google’s self-driving car arm -- has obtained a permit from the Arizona Department of Transportation to operate as a Transportation Network Company (TNC).
The company has been testing a self-driving car service in the Phoenix area since last spring, but its new TNC status puts it a step closer to being the first commercial ride-hailing service without human drivers in the U.S.
"As we continue to test-drive our fleet of vehicles in greater Phoenix, we’re taking all the steps necessary to launch our commercial service this year," a Waymo spokesman told Quartz.
Costs may be competitive with Uber and Lyft
Riders in Arizona will be able to be picked up and dropped off by one of the company’s thousands of driverless Chrysler Pacifica minivans, which the company grew from 600 earlier this year.
During its initial testing phase (dubbed the “early rider program”), the driverless vehicle service was free to riders in Arizona. However, Waymo’s new designation will allow it to charge for the rides.
The company hasn’t said how much it will charge riders, but the lack of human drivers means costs will likely be competitive with Uber and Lyft’s human-powered networks.
Experts say driverless vehicle programs could be a game changer in the ride-hailing industry, since self-driving cars will be able to reach more riders than a similar number of personally-owned vehicles.
Although self-driving technology has plenty of potential cost and safety benefits for consumers, some argue that putting a computer in charge of operating a vehicle could come with serious risks.
The National Highway Traffic Safety Administration (NHTSA) has previously been skeptical of self-driving car technology, even calling for a ban on autonomous vehicles in 2013 until the technology underwent further testing.
However, last Fall, the agency said self-driving cars “will become a reality” and released new federal guidance for Automated Driving Systems (ADS) with the goal of ensuring the technology is as safe as possible for riders.