Shares in rental-car companies Avis Budget Group (CAR) and Hertz Global Holding (HTZ) jumped in trading Monday after Avis announced a pact with Waymo, the self-driving auto unit of Google-parent Alphabet (GOOGL).
Under the deal, Avis will manage Waymo's small fleet of autonomous vehicles in Phoenix, where the Alphabet unit is testing a ride-hailing service with volunteer members of the public. Avis will service and store Waymo's Chrysler Pacifica minivans.
Waymo will pay Avis for its service, though financial terms were not disclosed. Waymo could partner with Avis in other markets if it expands trials or finds other partners.
Avis stock jumped 8.5% to 26.32 in the stock market today. Shares in Hertz were up 7.7% to 10.28, as Wall Street apparently expects the car-rental leader to score its own self-driving deal with one of several entities involved in the effort.
Tech firms developing self-driving car technology are not interested in manufacturing autonomous vehicles and also need logistical partners such as Avis, analysts say.
Waymo's initial auto industry partner has been Fiat Chrysler (FCAU). Waymo has also been in discussions with Honda, General Motors (GM) and Ford (F).
Apple (AAPL) recently received permission from the California Department of Motor Vehicles to test self-driving cars on public roads in the state. Apple has never publicly acknowledged its Project Titan self-driving efforts, which reportedly have shifted from an Apple-made car to Apple self-driving software.
GM is testing self-driving cars in Michigan, while Uber is doing the same in Pittsburgh.
Waymo also has an alliance with Lyft, Uber's rival in ride-hailing services.
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