New York Governor Kathy Hochul has withdrawn a proposal that would have permitted the widespread deployment of robottaxis across the state.

The plan, aimed at allowing driverless taxis in cities outside of New York City, failed to gain traction with state legislators. This decision represents a significant blow to Alphabet Inc.'s self-driving car division, Waymo, which had invested heavily in lobbying efforts for state approval.

"Based on conversations with stakeholders, including in the legislature, it was clear that the support was not there to advance this proposal," stated Sean Butler, a spokesperson for Governor Hochul.

This move does not impact Waymo's ongoing testing in New York City, which utilizes safety drivers. The autonomous vehicle company faced considerable opposition from labor unions, rideshare drivers, and transit workers following the New York Department of Transportation's approval of Waymo's testing permit for the city. This permit is set to expire at the end of March.

Despite the setback, Waymo remains committed to operating in New York. "While we are disappointed by the Governor’s decision, we’re committed to bringing our service to New York and will work with the State Legislature to advance this issue," said Waymo spokesperson Ethan Teicher. "The path forward requires a collaborative approach that prioritizes transparency and public safety."

Waymo has been aggressively expanding its services, operating approximately 400,000 rides weekly across various U.S. cities. This regulatory hurdle in New York contrasts with the company's rapid growth in markets like the San Francisco Bay Area, Los Angeles, Phoenix, Austin, Atlanta, and Miami.