Why Uber Technologies Plunged Today

Shares of Uber Technologies (NYSE: UBER) fell 9.6% in today's trading.

At first it may seem odd for Uber to be falling, as the company didn't make any major announcements today. However, a possible future competitor did, with big potential long-term implications.

Waymo is coming to Miami

On Thursday, autonomous ride-hailing company Waymo, which is majority owned by Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) , announced it would be expanding to Miami in 2025, with the goal of offering autonomous rides by 2026.

Waymo was founded in 2009 as one of Alphabet's "Other Bets," or "moonshot" projects that could one day turn into a big business. Waymo was then spun off into a separate subsidiary company in 2016, and has attracted outside funding to help Alphabet bring its technology to market. In fact, Waymo just raised another $5.6 billion from a group of major venture capital firms in late October. Deepwater Asset Management recently estimated that Alphabet still owns about 70% of the company today.

With its own ride-hailing app, Waymo is already delivering autonomous rides in San Francisco, Los Angeles, and Phoenix. Therefore, Waymo could potentially become a big competitor to Uber, which dominates ride-hailing today.

Yet the two companies have also partnered in the recent past. In September, Uber and Waymo announced they would jointly bring autonomous rides to Austin and Atlanta through the Uber app. As part of that partnership, Uber will provide fleet management services.

However, Waymo identified another partner, Moove, for fleet management in Miami. So, perhaps Uber being cut out of the Miami announcement led to such a big sell-off today.

Uber dominates ride-hailing today, but that could change

Investors might have thought Uber would partner Waymo in each additional city Waymo enters. However, it looks as if Uber isn't the only game in town for fleet management.

If Uber can leverage its dominant ride-hailing network effects in the age of autonomy, this sell-off could be an opportunity to buy. However, there's also a chance Uber may be disrupted by autonomy. In that case, all bets are off.