Summary
- General Motors plans to cut funding for Cruise in a pivot away from the commercial robotaxis business
- GM will focus on developing its Super Cruise driver assistance system for personal vehicles
- The company aims to decrease spending by over $1 billion per year through the restructuring of Cruise’s operations
- Cruise has a roughly 90% stake from GM and agreements with other shareholders to increase ownership
- This decision follows increased competition in the autonomous driving industry including companies like Tesla and Google-owned Waymo
Article
General Motors (GM) has announced a major pivot away from the commercial robotaxi business by cutting funding for its driverless robotaxi company Cruise. Instead, the company plans to focus on autonomy development in its own personal vehicles. This shift was detailed in a press release on Tuesday, with GM intending to bring its autonomy development program in-house to its own vehicles, particularly its Super Cruise driver assistance system. The decision to cut funding for Cruise’s robotaxi development was due to the considerable time and resources required to scale the business and the increasingly competitive robotaxi market.
GM currently holds a roughly 90 percent stake in Cruise, with plans to increase that to over 97 percent. The company aims to decrease spending by over $1 billion per year upon completion of the restructuring plan. GM CEO Mary Barra expressed commitment to delivering the best driving experiences to customers in a capital-efficient manner. The company plans to work closely with the Cruise leadership team on restructuring and refocusing Cruise’s operations, expecting to complete the plan proposal by the first half of 2025, subject to share repurchases and Cruise board approval.
The decision to pivot away from commercial robotaxis comes after GM’s September announcement of plans to re-launch paid driverless ride-hailing services with Cruise, following an accident involving one of its robotaxis last October. This incident led to staff shake-ups and legal issues for the company. Cruise Founder Kyle Vogt responded to GM cutting funding by criticizing the decision. The move also comes amidst competition from industry players like Google-owned Waymo, Amazon’s Zoox, and Tesla, which unveiled its Cybercab robotaxi based on its Full Self-Driving (FSD) software in October.
There have been speculations within the Tesla community that the company could license its FSD software to other automakers once it transitions from Supervised to Unsupervised mode. GM’s pivot towards an autonomy development model utilizing data from customer vehicles has sparked discussions on potential FSD licensing deals with Tesla. While Elon Musk has mentioned the possibility of licensing FSD to other automakers, no official partnerships have been disclosed yet. Recent interactions on X and social media have reignited discussions around this possibility, especially with GM ending funding for Cruise citing increased competition in the industry. This suggests that Tesla might be closer to making FSD licensing deals a reality.
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