GM’s Cruise autonomous taxi division is closing after a year interruped by accidents and service suspensions. That’s atop billions of dollars in losses since it took over the company in 2016.
Autonomous everything was once touted as the future of motoring but implementation has been much harder than anyone thought. And that’s just on the ground. Some see the future of electric mobility based on autonomous flying taxis. Good luck with that.
Instead of the autonomous taxi concept GM will fold the remains of the business into its self-driving and driver assistance technology divisions.
Currently GM owns 90 per cent of Cruise but Honda has apparently spent around $US1b for a minority stake in the business. Cruise had even planned to launch robotaxi services in Japan from 2026.
GM will evidently buy out Cruise’s minority shareholders, before terminating the company. Without Cruise, GM hopes to save $US1b per annum as of next year.
Cruise itself has been plagued by accidents, traffic jams, and a pause in its taxi services.
In October last year, one of its taxis hit a pedestrian who had been struck in a hit-and-run incident. A California court suspended the company’s licence to operate fully autonomous vehicles.
Subsequently, Cruise suspended all robotaxi activities across the US. It had been operating trial services in San Francisco, Phoenix, Houston, and Austin. Of the 3800 employed then, 900 were shed.
On-road trials resumed this year but in some cases the modified Chevrolet Bolt hatchbacks had human operators aboard who could take over in an emergency.
GM injected a further $US850m into Cruise midway through the year. Since it bought into Cruise the firm has lost over $US8b. It felt Cruise had the potential to be a cash cow by the turn of the decade. However, it failed to compete with the likes of Waymo, Google’s robotaxi project that operates in San Francisco, Phoenix, and Los Angeles, and will soon spread to Austin, Miami, and Atlanta.
GM is now in the midst of restructuring, having written down the value of its Chinese operations. Buick was once popular there but interest in EVs and a surge in local brands has impacted significantly on GM’s operation. The Cruise experiment hasn’t helped.
