GM Abandons Robotaxi Biz to Focus on Personal Autonomous Vehicles

General Motors (GM) has announced a strategic shift in its autonomous driving efforts, concentrating on developing systems for personal vehicles rather than robotaxis, as the company announced on Tuesday.

The company aims to enhance its advanced driver assistance systems (ADAS), building on the success of its Super Cruise feature, which operates on over 20 vehicle models and logs more than 10 million miles monthly.

The move will integrate Cruise LLC, GM’s majority-owned autonomous vehicle subsidiary, with GM’s technical teams. The company will also cease funding Cruise’s robotaxi development, citing the time, resources, and competition required to scale that business.

“GM is committed to delivering the best driving experiences to our customers in a disciplined and capital-efficient manner,” said Mary Barra, GM Chair and CEO. 

The decision comes as the robotaxi industry faces increased competition and regulatory hurdles. Cruise, GM’s self-driving subsidiary, had faced significant setbacks, including a critical incident in October 2023 in which a Cruise vehicle dragged a pedestrian, resulting in severe injuries. 

Following the incident, California revoked Cruise’s driverless testing permit, leading to a temporary suspension of its operations.

Dave Richardson, GM’s senior VP of software and services engineering, claims, “We are fully committed to autonomous driving and excited to bring benefits like enhanced safety, improved traffic flow, increased accessibility, and reduced driver stress to our customers.”

While Cruise CEO Marc Whitten and other leaders will remain to guide the transition, GM did not clarify the future of Cruise’s employees. The company currently owns 90% of Cruise and plans to increase its stake to over 97% and acquire the remaining shares, subject to Cruise board approval. 

The restructuring aims to cut annual spending by over $1 billion, with completion targeted for the first half of 2025.

What are people saying?

George Hotz, president at comma.ai, took to X to express that he had called this development five years ago. He says, “If you have been paying attention, self-driving has played out exactly like I said it would.”

Earlier this year, GM had also let go of Origin, a fully autonomous shuttle developed by the company in partnership with Honda. Kyle Vogt, former co-founder at Cruise and Twitch, had then expressed that he was “disappointed to see GM kill the Origin.”

Disappointed to see GM kill the Origin. Would have been amazing for cities.

GM repeatedly finds themselves with a 5-10 year head start, but then fumbles the ball, shuts things down, and loses the lead. Anyone remember the EV1?

It’s like someone keeps letting them look into a… pic.twitter.com/GDlL4KQk4S

— Kyle Vogt (@kvogt) July 23, 2024

Regarding Cruise, Ian Kar, General Partner at Vol. 1 Ventures, says, “Cruise, I think was a huge opportunity for an incumbent to actually move the needle and actually be innovative.”

Garry Tan, president & CEO at Y-combinator, also took the opportunity to comment on this. 

Not sure what will be a bigger own-goal in the end—

GM shutting down Cruise or Twitter shutting down Vine

— Garry Tan (@garrytan) December 11, 2024

Cost and Competition Drive Shift

GM’s chief financial officer, Paul Jacobson, said during an investor call that continuing with Cruise’s robotaxi ambitions would require substantial additional capital beyond the $10 billion already invested. 

He noted, “The better use is to pursue improvements to L3 and L4 autonomy in personal vehicles, aligning with the needs of the business going forward.”

GM plans to integrate Cruise’s operations with its technical teams to enhance technologies like its current Super Cruise system, which offers hands-free driving in select models. The restructuring is expected to reduce GM’s expenditures by over $1 billion annually starting in 2025.

Broader Implications

The decision highlights broader struggles in the robotaxi market. Ford and Volkswagen shuttered their joint self-driving venture, Argo AI, in 2022. Meanwhile, competitors like Tesla, Waymo, and Amazon continue to explore the sector.

GM’s decision follows other cost-cutting measures, including scaling back investments in a battery plant joint venture and streamlining operations in China. 

Despite these challenges, GM aims to leverage its expertise in vehicle manufacturing to redefine autonomous driving in the personal car segment.