Governor Gavin Newsom (D-CA) has endorsed the move by the Service Employees International Union (SEIU) and the California Gig Workers Union (CGWU) to represent drivers working for ride-hailing platforms Uber Technologies Inc. (NYSE: UBER) and Lyft Inc. (NASDAQ: LYFT). In a post on X on Monday, Newsom described the development as "an amazing new day for Californians working as rideshare drivers," noting that the right to unionize was established less than a year after California enacted the relevant law.

The legislation enables more than 800,000 drivers to exercise the legally protected choice to unionize and participate in collective bargaining regarding wages, benefits, and working conditions. According to a statement from the CGWU on Friday, this development will establish the organization as the largest union of gig rideshare drivers globally, subject to a 30-day waiting period. The SEIU confirmed that it had reached the necessary support threshold to represent drivers from both companies.

Newsom contrasted this legislative progress with broader national trends, stating that "at a time when workers’ rights are under attack and families across the country are struggling with affordability because of the Trump administration, California is showing what it means to stand with working people."

Autonomous Vehicle Developments

The push for unionization coincides with significant strategic shifts in autonomous driving for both ride-hailing giants. Uber has expanded its Robotaxi service in Japan and announced a partnership with drone delivery company Zipline to facilitate food deliveries via its Uber Eats platform across the United States. The company has outlined a hybrid approach that incorporates both human drivers and autonomous vehicles, while reportedly ending its partnership with Alphabet Inc.-backed Waymo in 2028.

Lyft’s autonomous efforts have been less pronounced but include a collaboration with Baidu Inc.-backed Apollo Go. Apollo Go recently began testing its Robotaxis in London in partnership with both Lyft and Uber.

Political Context

The unionization drive in California follows similar efforts in other states. Earlier this year, Senator Bernie Sanders (I-VT) praised the unionization of ride-sharing drivers for Uber and Lyft in Massachusetts, where the union represents approximately 70,000 drivers. Sanders has also advocated for fair wages for platform workers.

Uber Technologies Inc. (NYSE: UBER) and autonomous delivery company Zipline announced a strategic partnership on Monday to expand drone delivery services across the United States. The collaboration aims to integrate Zipline’s technology into the Uber Eats platform, launching later this year in markets where Zipline already operates before expanding to dozens of additional US cities.

As part of the agreement, Uber made a strategic investment in Zipline. The companies stated a joint goal of achieving 1 million drone deliveries per day by the end of 2029. This move adds drones to Uber’s existing delivery ecosystem, which currently relies on human couriers and sidewalk robots.

Strategic Shift In Autonomous Delivery

The partnership with Zipline coincides with Uber winding down its involvement with another autonomous delivery provider. Uber recently sold its remaining stake in Serve Robotics Inc. (NASDAQ: SERV), its sidewalk robot partner since 2022.

Uber and Serve had expanded their partnership in 2023 to cover up to 2,000 robots across several US cities. However, Serve CEO Ali Kashani cited "differing views" regarding the shared autonomous fleet and operating model. Serve has indicated that the partnership may not be renewed after it expires in 2027.

Operational Scale Of Zipline

Zipline brings significant operational history to the partnership. The company has completed more than 2.7 million deliveries and flown over 135 million autonomous miles. Its operations span four continents, serving more than 5,000 hospitals and health facilities.

What The Numbers Show

The partnership highlights a divergence in Uber’s autonomous delivery strategy. While the company is exiting a ground-based robot partnership due to operational disagreements, it is doubling down on aerial delivery through a capital investment in Zipline. The target of 1 million daily deliveries by 2029 represents a specific volume milestone for this new segment, distinct from Uber’s broader, existing courier network.

Technical And Market Context

Uber shares edged higher on Monday as the broader market traded mixed. The Nasdaq gained 0.16%, while the S&P 500 fell 0.17%. The Industrials sector rose 0.43%.

The stock is trading above its 20-day, 50-day, and 100-day simple moving averages of $72.23, $72.33, and $73, respectively. However, it remains about 2% below its 200-day SMA of $77.50. The Moving Average Convergence Divergence (MACD) indicator is above its signal line, with a positive histogram, pointing to improving short-term momentum.

Despite recent gains, Uber remains down 19.14% over the past 12 months. Traders may watch $78.50 as resistance and $69.50 as support.

Analyst Outlook

Uber carries a Buy consensus rating with an average price forecast of $103.95. Recent analyst actions include:

• Roth Capital lowered its price forecast to $100 while maintaining a Buy rating on Aug. 10.
• Jefferies raised its forecast to $110 and maintained a Buy rating on Aug. 10.
• DA Davidson lowered its forecast to $100 while keeping a Buy rating on Aug. 6.

ETF Exposure

Uber is a major holding in several exchange-traded funds, including:

• Invesco Nasdaq Internet ETF (NASDAQ: PNQI)
• Pacer U.S. Cash Cows Growth ETF (NYSEARCA: BUL)
• Pathfinder Focused Opportunities ETF (NASDAQ: PFOE)

Significant inflows or outflows from these funds could affect demand for Uber shares. At the time of publication, Uber shares were up 0.03% at $75.97.