The global autonomous driving battle intensifies! Alphabet's Waymo teams up with a Japanese giant to seize the Tokyo market.

According to Jinse Finance APP, as US market leaders continue their global expansion, Alphabet (GOOGL.US) subsidiary Waymo plans to bring its autonomous taxis to Japan next year.

Waymo announced on Tuesday that it will partner with Japanese taxi companies Go Inc. and Nihon Kotsu Co., Ltd. to launch fully autonomous taxi services in Tokyo in 2027. The two firms expect to start with a small fleet and gradually expand to 100 vehicles.

Go, which operates Japan's largest taxi-hailing app, saw its share price rise by as much as 9.7% on Tuesday. Since its IPO in June, the stock has risen over 40% in total.

Waymo is rapidly expanding in the US and is now eyeing overseas markets—the company is also preparing an autonomous driving service in London. Over the past year, Waymo has been conducting tests in Tokyo, and its autonomous taxi service will be the first of its kind on public roads in Japan.

Waymo stated in a blog post that its autonomous taxis will "complement Tokyo’s world-renowned transportation network while helping Japan address an aging population and alleviate future labor shortages." Passengers will be able to hail rides through both Go and Waymo's apps.

In Japan, autonomous driving has long been seen as a pipe dream—the country’s streets are narrow and crowded, and regulations are famously strict. But in recent months, several companies have begun working to open up the market.

Earlier this year, US autonomous driving startup Nuro Inc. began testing in Tokyo, marking its first overseas location after collaborations with Uber and Lucid Group Inc. Nuro, backed by companies like Nvidia and Toyota Motor Corporation, aims to compete with Waymo and Amazon’s Zoox.

Waymo noted that its Japanese service still requires obtaining the necessary permits and licenses. Current Japanese regulations demand that, regardless of the vehicle’s level of automation, a person must be present in the driver’s seat.