Shares of ride-hailing service Lyft have surged 13% in pre-market trading. This increase follows Waymo’s announcement to launch a self-driving taxi service in Nashville next year, partnering with Lyft for the first time.
Waymo’s strategies vary by location, with some cities using only Waymo’s ‘One’ app, while others, like Atlanta and Austin, see partnerships with Uber. Though Lyft shares initially rose over 20%, they settled at a 13% increase after the market opened.
The market is highly interested in the robotaxi concept, placing high valuations on companies in this sector, including Tesla. However, the service’s economics remain unproven, with unresolved issues around security and cleaning at scale.
In Nashville, Lyft will offer end-to-end fleet management for Waymo, handling vehicle readiness, maintenance, infrastructure, and depot operations. Waymo is under Google’s wing, whose shares have reached $250 as they compete with ChatGPT alongside the new Nano Banana app.
Despite Lyft’s developments, Uber continues as the ride-hailing market leader, boasting a market cap 25 times greater than Lyft.
With Lyft’s stock showing such a significant jump today, September 17, 2025, we are seeing implied volatility spike. This makes selling options premium an attractive short-term strategy for those who believe the initial excitement, which took the stock up 20% before settling, will fade. For instance, implied volatility on near-term Lyft options has likely surged well above 70%, creating opportunities for selling covered calls or credit spreads to capitalize on time decay.
This Waymo partnership is a genuine positive for Lyft’s long-term story, which has struggled against its larger rival. However, we have seen this kind of optimism before, with similar spikes back in 2024 that eventually faded as operational realities set in. The path to profitable autonomous ride-hailing is long and filled with the same regulatory hurdles and public perception challenges we saw in cities like San Francisco and Phoenix years ago.
The news also puts pressure on Uber, but their market dominance remains a key factor. With Uber consistently holding around 75% of the U.S. ride-hailing market through 2024, this single-city Lyft partnership is more of a minor threat than a true game-changer. Still, some traders may consider buying puts on Uber as a hedge or as part of a pair trade against a long Lyft position.
We should remember that the economics of robotaxis are still largely theoretical, despite the market’s excitement. The operational challenges of fleet management, cleaning, and security are the same ones that caused setbacks for early autonomous vehicle rollouts back in 2023. Therefore, any long-term bullish plays, like buying long-dated call options on Lyft, should be viewed as highly speculative bets on an unproven model.
For Google, this partnership is a minor footnote given its massive scale and recent successes. The company’s stock is driven by much larger trends in advertising and its AI battles, not the operational details of one city’s Waymo fleet. Consequently, we don’t expect this news to have a meaningful impact on options activity for GOOGL itself.
