Autonomous vehicles (AVs) are already racking up millions of miles on public roads, but convincing the public to embrace driverless rides remains a significant challenge.

A recent ride in one of Waymo’s self-driving cars through San Francisco highlighted the growing familiarity with this technology. The sight of driverless vehicles is no longer an uncommon one, and tourists no longer seem amazed as they pass by. Inside the vehicle, Waymo aims to ease passengers’ nerves by offering a welcoming atmosphere—personalized greetings, music, and screens displaying the route and surroundings—helping them feel more connected to the ride. The technology is designed to inspire trust, showing passengers what the vehicle “sees” as it navigates the streets.

Waymo’s efforts are part of a larger push in the autonomous ride-hailing industry. Although self-driving vehicles are operational in select cities worldwide, public hesitation remains a key barrier. Research indicates that safety concerns are one of the biggest hurdles for passengers in the U.S. and the U.K., with many still unsure about the technology’s reliability compared to traditional vehicles.

To address this, Waymo focuses on transparency. “It’s important that passengers understand where the car is going and know it sees what they see,” says Megan Neese, Waymo’s head of product and customer research. The company’s next generation of cars will feature forward-facing seats and a steering wheel, echoing the traditional taxi experience that could make passengers feel more at ease.

Launched in 2020, Waymo—owned by Alphabet, Google’s parent company—now provides 150,000 paid rides weekly across San Francisco, Los Angeles, and Phoenix. While still small compared to ride-hailing giant Uber, which facilitates about 200 million trips globally each week, Waymo’s market is expanding.

Competitors like Amazon-backed Zoox are also working to gain consumer confidence. Zoox’s vehicle, set to debut in 2025, offers a drastically different experience. It is bi-directional with no windows or steering wheel, and instead, passengers sit facing each other, enjoying the ride in a more relaxed, amusement-park-like environment. To further build trust, Zoox has introduced a “Fusion Center,” where human operators can intervene remotely if necessary, similar to Waymo’s own response team.

In contrast, General Motors’ Cruise is working to overcome setbacks after a high-profile incident in 2023, in which one of its vehicles dragged a pedestrian. Despite this, Cruise has continued testing in Phoenix, Houston, and Dallas, with safety drivers behind the wheel.

The global push for autonomous vehicles is gaining traction, particularly in the U.S. and China. Waymo currently operates the largest fleet of autonomous vehicles in the U.S., with plans to expand to Austin and Atlanta by 2025. Meanwhile, China leads the world in testing, with over 16,000 autonomous vehicles approved for use in more than 20 cities.

Despite progress, widespread adoption remains a challenge. As regulatory frameworks evolve and AV technology advances, convincing the public to fully embrace autonomous vehicles will be crucial to the industry’s success. With companies like Zoox and Waymo competing for consumer trust, the future of self-driving taxis may hinge on how well passengers are able to trust and feel comfortable with the ride.

Efforts to revolutionize urban air transport with electric flying taxis are hitting significant headwinds as key players in the industry face mounting financial pressures and technical challenges.

Among the most high-profile setbacks is the case of Volocopter, the German firm that had promised to debut its two-seater electric aircraft, the VoloCity, at the 2024 Paris Olympics. Instead of ferrying passengers, Volocopter was limited to demonstration flights, as the company scrambled behind the scenes to secure funding.

Failed attempts to secure a €100 million loan from the German government have pushed Volocopter to rely on Chinese automaker Geely, which is in talks to acquire an 85% stake in exchange for $95 million in funding. If finalized, the deal may see manufacturing shift to China, raising questions about the future of Volocopter’s operations in Europe.

Financial Struggles Across the Industry

The financial hurdles facing Volocopter are not unique. German EVTOL (electric vertical takeoff and landing) company Lilium, known for its innovative jet-powered aircraft, entered insolvency proceedings in November after failing to secure a €100 million loan from Germany’s development bank. Despite boasting ambitious plans for 780 orders globally and €1.5 billion in previous funding, Lilium’s efforts to bring its radical designs to market have stalled.

Lilium is now seeking restructuring options, but its goal of beginning full-scale testing by 2025 appears increasingly uncertain.

Meanwhile, the UK-based Vertical Aerospace, led by OVO Energy founder Stephen Fitzpatrick, faces its own challenges. The company’s VX4 aircraft has shown promise, completing piloted tests and achieving its first untethered takeoff and landing in November. Yet setbacks, including a 2022 crash and the withdrawal of Rolls-Royce from a key supply deal, have compounded financial strain.

Vertical Aerospace is in talks with financier Jason Mudrick, whose firm has proposed a $75 million investment. While the deal could secure the company’s immediate future, it risks stripping Fitzpatrick of control.

A Glimpse of Stability

Amid the uncertainty, Airbus’s CityAirbus NextGen project appears to be on solid footing. The four-seater EVTOL aircraft, backed by Airbus’s deep resources and technical expertise, is on track to become a reality. Similarly, well-funded US companies like Joby Aviation and Archer Aviation are progressing steadily toward production.

Questions About Profitability

Even as EVTOL companies inch closer to delivering their aircraft, profitability remains a looming challenge. Initial routes are expected to connect airports to city centers, but operational costs, particularly for pilots and batteries, cast doubt on their commercial viability.

Bjorn Fehrm, an aerospace consultant and former Swedish Air Force pilot, suggests the industry’s enthusiasm stems from the allure of pioneering technology. “No one wanted to miss out on the next Tesla,” he remarks.

As the sector grapples with turbulence, the promise of quiet, efficient urban air travel hangs in the balance.