“GM Halts Cruise Operations Due to Insufficient Profitability”

"GM Halts Cruise Operations Due to Insufficient Profitability"

“GM Halts Cruise Operations Due to Insufficient Profitability”


# GM Shifts Attention to Partial Automation, Discontinues Robotaxi Aspirations

Following an investment exceeding $10 billion in its autonomous vehicle division, Cruise, General Motors (GM) has opted to change its course. The automaker revealed it will halt further funding for Cruise’s robotaxi initiatives and instead incorporate the startup’s technical team into GM’s wider pursuits. This signifies a major alteration in GM’s strategy regarding autonomous driving technology, as it departs from the lofty aim of completely autonomous robotaxis and steers towards a more pragmatic emphasis on partial automation for passenger cars.

## The Conclusion of the Robotaxi Vision

GM’s choice to reduce its autonomous vehicle goals comes after numerous obstacles and escalating expenses. Since buying Cruise in 2016, GM envisioned a scenario where fleets of driverless robotaxis would navigate major U.S. cities. The company even advocated for regulatory changes to permit the creation of vehicles devoid of steering wheels or pedals. Nevertheless, the actual development of a fully autonomous system capable of managing countless unpredictable situations has proven to be significantly more intricate and expensive than expected.

Initially, Cruise’s technology was tested with a fleet of Chevrolet Bolts, with aspirations to transition to a specially designed autonomous vehicle named the Origin. However, the Origin project was halted earlier this year, and Cruise persisted with the Bolt for ongoing testing. Despite these endeavors, GM’s robotaxi aspirations encountered considerable challenges, including a notorious incident in 2023 where a Cruise vehicle struck a pedestrian and dragged them after a collision. This prompted California to suspend Cruise’s permit to test driverless vehicles, further complicating the company’s future.

## An Industry-Wide Challenge

GM’s decision mirrors the larger difficulties confronting the autonomous vehicle sector. The allure of fully autonomous robotaxis has been an enticing objective for automakers and tech firms alike, but the path to profitability has proved to be more challenging than anticipated. In 2022, Ford and Volkswagen retracted their joint investment in Argo AI, another autonomous vehicle startup, citing similar worries regarding the viability of achieving profits soon.

The substantial expenditures and technical challenges inherent in creating fully autonomous systems have compelled many businesses to reevaluate their approaches. GM’s shift away from robotaxis is expected to save the company around $1 billion annually, enabling it to redirect resources to more feasible targets.

## A Fresh Emphasis on Partial Automation

Rather than chasing fully autonomous vehicles, GM intends to enhance its existing Super Cruise technology to establish a Level 3 partially automated driving system. In contrast to fully autonomous systems, Level 3 automation permits drivers to divert their attention from the road under certain conditions, such as during low-speed traffic congestion. This method is akin to Mercedes-Benz’s Drive Pilot system, which has been rolled out in several markets.

Mary Barra, GM’s chair and CEO, reaffirmed the company’s dedication to driver-assistance and autonomous driving technologies, asserting, “Cruise has been an early innovator in autonomy, and the deeper integration of our teams, paired with GM’s strong brands, scale, and manufacturing strength, will help advance our vision for the future of transportation.”

Nonetheless, the pivotal question persists: Are consumers genuinely interested in partial automation? Although investors have displayed enthusiasm for autonomous driving technologies, consumer interest appears to be less fervent. Research suggests that features such as hands-free driver assistance are not among the foremost priorities for car buyers, who generally prefer practical features like wireless device charging or panoramic sunroofs. Furthermore, there is limited evidence indicating that partial automation significantly enhances road safety, complicating its attractiveness to the typical consumer.

## The Path Forward for Automation at GM

GM’s decision to shift its focus from robotaxis to partial automation signifies a realistic recognition of the hurdles confronting the autonomous vehicle sector. By utilizing its existing Super Cruise technology and incorporating Cruise’s capabilities, GM aspires to provide advanced driver-assistance features that resonate more closely with consumer demands and market realities.

While the aspiration for fully autonomous vehicles may be temporarily on pause, GM’s strategic pivot emphasizes the necessity for adaptability within a swiftly changing automotive environment. As the company persists in its innovation endeavors, it must harmonize technological aspirations with practical realities to maintain its competitiveness in the ongoing race toward the future of transportation.