Billions spent, results absent: GM halts Cruise robotaxi project

GM, which has owned about 90 percent of Cruise since 2016, announced this week that it will cease funding the robotaxi project. This move comes after a difficult period for Cruise, including an incident in October 2023 when one of their autonomous vehicles struck a woman in San Francisco after she was pushed into its path by a car with a human driver. The incident led California regulators to suspend Cruise’s license for testing autonomous vehicles on the roads of that state, forcing the company to halt operations in other areas as well. However, in May 2024, the company resumed limited testing in Arizona. The decision was also facilitated by the fact that Cruise has been recording multi-year financial losses. According to GM CEO Mary Barra, the company has invested about 10 billion dollars in Cruise so far, while the subsidiary recorded a loss of 3.48 billion dollars in 2023 alone. Despite ambitious goals, the robotaxi service has failed to achieve a sustainable business model.

A costly endeavor

From General Motors, they added that they ‘will no longer fund the development of Cruise’s robotaxis due to the significant time and resources required for business expansion, along with an increasingly competitive robotaxi market.’ The company plans to merge the technical teams of Cruise and GM into a single unit focused on developing autonomous vehicles for personal use.

– GM is committed to delivering the best driving experience to its customers in a disciplined and capital-efficient manner. Cruise was an early innovator in the field of autonomy, and deeper integration of our teams, combined with strong GM brands, scale, and manufacturing capabilities, will help realize our vision for the future of transportation – said Barra.

Dave Richardson, senior vice president of software engineering and services at GM, added that the company is ‘fully committed to autonomous driving and excited to bring its benefits to users — such as improved safety, better traffic flow, increased availability, and reduced stress for drivers.’

Cruise has not yet publicly commented on GM’s decision to halt funding or how it will affect their autonomous testing in the near future. The company currently has autonomous vehicles on the roads in Texas and Arizona, but GM’s decision will likely lead to the suspension of all those operations.

GM’s decision highlights the challenges facing the robotaxi industry, which currently consists mainly of pilot projects. A similar move was made by Ford in 2022 when it ceased funding for autonomous vehicle experts from the company Argo. Waymo, backed by Alphabet, is currently leading in this field, testing its robotaxis in multiple cities, including a recently announced expansion to Miami.

Vandals and Waymo

However, even Waymo is not without problems, and these are unexpected. The company owned by Google’s parent company Alphabet has been testing its autonomous robotaxis on the streets of San Francisco for years and recently received permission to start charging for rides. However, Waymo is facing issues that you probably never thought of. The problems are attacks on their autonomous taxis. Reports of attacks on Waymo vehicles date back years, whether it involves slashing tires or historical stone-throwing at these robotaxis. Recently, a group of vandals went a step further, and a Waymo taxi ended up being set on fire.