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Why Does Uber Technologies Want Toyota's Help With Self-Driving?

A gray Volvo SUV with visible self-driving sensor hardware and Uber logos parked on a street in San Francisco.

The CEO of Uber Technologies said that he wants to get to work with Toyota (NYSE: TM) on self-driving cars, as he looks to accelerate the ridesharing giant's transition to automated vehicles.

On Thursday, Uber CEO Dara Khosrowshahi tweeted a photo of himself and two other Uber executives with Toyota CEO Akio Toyoda and Executive Vice President Shigeki Tomoyama, saying that he and the Toyota executives had discussed "growing our autonomous partnership."

Having fun with Akio-San and Tomoyama-San @ToyotaMotorCorp HQ. Great discussions about growing our #autonomous partnership and lessons 4 me in building a great culture. And yep, those are Ichiro's bats. #StartYourImpossible#batterup ! dara khosrowshahi (@dkhos) February 22, 2018

It's not entirely clear what that means. But from other remarks that Khosrowshahi has made on his current trip to Asia, and from what we know of Uber's existing relationship with Toyota, it appears that Khosrowshahi doesn't want to wait for Uber's own autonomous-vehicle development program to finish its work before deploying self-driving cars.

Uber has its own self-driving program, but...

Here's the background: In May 2016, Toyota announced that it had made a "strategic investment" in Uber, and that it would work with the ridesharing company to create a program under which Uber drivers could lease Toyota vehicles at affordable rates. Neither company said much about the relationship in the months that followed.

Separately, Uber has had its own self-driving research and development effort underway for several years. By May 2016, that effort had progressed far enough that Uber was able to begin deploying a small fleet of prototype self-driving vehicles in its service in Pittsburgh and in San Francisco several months later.

A gray Volvo SUV with visible self-driving sensor hardware and Uber logos parked on a street in San Francisco.

Uber deployed prototype self-driving Volvos in San Francisco in late 2016. Image source: Volvo Cars.

It now appears that Uber's effort hasn't made a whole lot of progress since. Or put another way, Uber's internal self-driving effort is still probably several years away from being able to deploy self-driving vehicles at scale.

Uber founder Travis Kalanick felt that Uber needed to develop self-driving technology internally to retain control over the data it generated. But Khosrowshahi, who succeeded Kalanick as Uber's CEO in August of last year, seems to think that getting self-driving Ubers on the road soon is more important than ensuring that its technology is homegrown -- and he's eager to get Toyota's help. Here's what he told investors at a conference earlier this week:

We have a very budding partnership with Toyota. We have to make sure we have access to leading autonomous technology. And that means having access to it in a timely manner. I do believe we can develop our own autonomous technology that we're doing, and at the same time partner with other players in autonomous technology.

(Khosrowshahi's remarks were first reported by Bloomberg .)

Since he took over as Uber's CEO last August after Kalanick's ouster , Khosrowshahi has been looking for ways to move Uber past an extraordinarily difficult period. Accelerating its adoption of self-driving technology may be another step on that path.

Moving past Uber's scandals

Uber was rocked by a series of scandals last year, including multiple charges of sexual harassment and discrimination, several reports of questionably legal business practices, and a blockbuster lawsuit in which Alphabet 's (NASDAQ: GOOG) (NASDAQ: GOOGL) self-driving subsidiary, Waymo, accused Uber of stealing key pieces of its technology. A slew of key executives , including Kalanick, were forced out in the wake of the scandals. (Kalanick remains on Uber's board of directors.)

Since taking the top job, Khosrowshahi has tried to set a new tone for Uber, emphasizing diversity and inclusion inside the company and working to mend strained relationships with government officials in the U.S. and abroad. Earlier this month, Khosrowshahi ended the heated court battle with Waymo without having to fork over any cash, instead offering Alphabet a small stake in Uber -- and promising not to use any of Waymo's technology in its future self-driving vehicles.

Is that why Khosrowshahi now wants to share self-driving technology with Toyota? It may be. Stay tuned.

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