General Motors has announced that it would stop investing in its financially troubled Cruise autonomous vehicle subsidiary and exit the robotaxi industry.
The Detroit automaker will instead concentrate on developing partially automated driver-assist systems like its Super Cruise, which enables drivers to take their hands off the steering wheel, according to a press release issued Tuesday and the conference call that followed, which featured GM Chair and CEO Mary Barra.
“Given the considerable time and resources that would be needed to scale the business, along with an increasingly competitive robotaxi market,” GM stated that it would exit the robotaxis market.
The business announced that it would integrate its own technical team with Cruise’s to develop cutting-edge driver assistance systems.
According to Cruise CEO Marc Whitten, “GM is working closely with the Cruise Board of Directors and the Cruise leadership team on next steps.”
With the goal of creating a lucrative fleet of robotaxis, GM paid at least $1 billion to acquire the then-San Francisco-based start-up Cruise Automation in 2016. Google and Cruise Automation were two of the few businesses at the time that have California state authorization to test the vehicles.
GM eventually purchased 90% of the business from investors after making billions of dollars in the subsidiary over the years.
After one of its autonomous Chevrolet Bolts dragged a person on a San Francisco street who was struck by another car in 2023, GM reduced its investment in the company, despite having previously stated intentions for Cruise to bring in $1 billion annually by 2025.
The California Public Utilities Commission terminated Cruise’s driverless testing authorization and said the firm concealed information about the collision. Soon after, Cruise removed all of its autonomous vehicles from the road across the country.
The corporation and its driverless vehicles were widely criticized as a result of the occurrences. Cruise had already faced criticism for several collisions, which prompted the corporation to reduce the number of robotaxis it operated in the summer of 2023.
In addition to layoffs that left around 25% of its workers, the issues led to a purge of its leadership.
The business made an offer to pay $75,000 in January of this year to resolve the California state authorities’ probe into Cruise’s failure to disclose information about the crash.
Cruise was still trying to get back on its feet in spite of its problems. One of the main engineers of the Xbox video gaming console, Marc Whitten, was appointed as General Motors’ next chief executive in June. As part of a multi-year agreement that brought together two businesses that had previously seemed ready to fight for passengers, Cruise revealed in August that its robotaxis would join Uber’s ride-hailing service in 2025.
However, GM has had to pay a high price for more recent Cruise improvements. As part of a consent decree, the National Highway Traffic Safety Administration said in September that the division will pay a $1.5 million penalty. Cruise admitted to filing a fraudulent report after the pedestrian incident in San Francisco last month, and he agreed to pay an additional $500,000 fine.
The San Francisco-based business signed a deferred prosecution deal wherein Cruise acknowledges and takes responsibility, according to a statement from the Northern District of California U.S. Attorney’s office.
The U.S. Attorney’s Criminal Division Chief, Martha Boersch, issued a statement saying, “Companies with self-driving cars that seek to share our roads and crosswalks must be fully truthful in their reports to their regulators.”
Note: Every piece of content is rigorously reviewed by our team of experienced writers and editors to ensure its accuracy. Our writers use credible sources and adhere to strict fact-checking protocols to verify all claims and data before publication. If an error is identified, we promptly correct it and strive for transparency in all updates, feel free to reach out to us via email. We appreciate your trust and support!
Eliot Pierce is a dedicated writer for ChiefsFocus.com, covering local crime and finance news. With a keen eye for detail and a passion for storytelling, Eliot aims to provide his readers with clear and insightful analysis, helping them navigate the complexities of their financial lives while staying informed about important local events. His commitment to delivering accurate and engaging content makes him a valuable resource for the community.