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GM says it will end funding of Cruise robotaxi efforts to concentrate on autonomous driving for personal cars.
The automaker will instead combine Cruise’s technical team with its own to establish a “single effort” for both driverless cars and driver aids. There would be “considerable time and resources” needed to grow the robotaxi business, GM says.
GM already owns 90% of Cruise, but will use shareholder deals and its own funds to buy out the remaining 10% stake. It then plans to work with Cruise leadership to “restructure and refocus,” with completion due in the first half of 2025. The move is expected to save over $1 billion per year.
The decision isn’t surprising. Cruise has reeled ever since one of its robotaxis struck a pedestrian in October 2023. That led to California banning the autonomous cars on its streets for months, and a restructuring of the company that included layoffs and the departure of CEO Kyle Vogt. Cruise voluntarily halted testing in other states and shelved plans for its shuttle-style Origin robotaxi. Xbox veteran Marc Whitten became Cruise’s new CEO in June.
The leadership change was overshadowed in November when Cruise admitted to submitting a false incident report in hopes of affecting a federal safety investigation over the pedestrian impact. It agreed to pay a $500,000 fine to defer prosecution.
The incident and its aftermath not only disrupted Cruise, but gave its main rival Waymo a competitive advantage. Combine this with GM’s other challenges, including a weaker EV market (if one where it’s doing relatively well), and the costs of maintaining Cruise as-is were going to be steep. This theoretically helps GM streamline its costs even as it aims to challenge Tesla, Ford, and others with increasing autonomy in their vehicles.
