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United Kingdom -based Jaguar Land Rover unveiled its first pure electric vehicle (EV), the I-Pace, back in 2016, though the vehicle's not scheduled to go to market until later this year. Recently, General Motors announced it would test autonomous vehicles, potentially setting up a showdown with Waymo for driverless taxis.

"It's offering the right vehicle, the right mobility for the right situation", Speth said at an event in NY announcing the deal.

He also said that the Jaguar Land Rover model also has a bigger battery, allowing the auto to drive all day. The service enables members of the public to request a vehicle using a mobile app, and will initially launch in Phoenix, Arizona. Waymo has been testing self-driving trucks in California and Arizona and just started testing in Atlanta, hauling cargo to Google's data centers. Waymo so far has relied on these little toy cars. Now Waymo has committed to developing 20,000 autonomous versions of the I-Pace over the next few years. The two companies said they've agreed to work together on a huge fleet of electric SUVs fitted with Waymo's self-driving technology.

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The new I-Pace prototypes will build on the five million miles the company has already recorded on public roads in cities and states like Michigan, San Francisco, Washington, and Atlanta, in what it calls the "toughest, longest driving test", as well as the five billion miles recorded in simulation. It says that the vehicle will soon start playing a "vital full-time role" in its service soon.

Jaguar will deliver its vehicles for Waymo's ride-hailing from 2020 to 2022.

Krafcik said the 20,000 I-PACE SUVs will be capable of servicing up to 1 million trips in a single day. Waymo and others might be experimenting with taxi-replacement schemes right now, but early adopters of self-driving technology are nearly certain to be well-heeled and status motivated when the free betas are through and suddenly we have to start paying for such services.

"It ended up being a really terrific next vehicle for us and fit one of the key aspects of our business plan", John Krafcik, Waymo's chief executive officer, said in an interview.