- GM has cut funding to Cruise and will merge the self-driving technology startup with its own technical teams
- GM will continue developing self-driving technology for use in privately owned vehicles
- GM has invested more than $10 billion in Cruise since acquiring the startup in 2016
General Motors will end development of a robotaxi service through its majority-owned Cruise self-driving technology startup, the automaker announced on Tuesday.
Under its new strategy, GM will merge Cruise with its own technical teams to develop self-driving technology for privately owned vehicles, such as the current Super Cruise automated driver-assist system for highways.
GM stated that the time and resources required by Cruise to realize a robotaxi service in an increasingly competitive environment would place too great a strain on its finances.
“GM is committed to delivering the best driving experiences to our customers in a disciplined and capital-efficient manner,” Mary Barra, GM’s chair and CEO, said in a statement.
One of 130 second-generation self-driving Chevrolet Bolt EV electric cars, with GM CEO Mary Barra
GM owns approximately 90% of Cruise, which isn’t publicly traded. According to The Detroit News, GM has invested more than $10 billion into Cruise since acquiring the startup in 2016. The automaker had previously projected Cruise to generate upwards of $50 billion in revenue by the end of the decade through robotaxi services in multiple major U.S. cities.
GM stated it has agreements with other Cruise shareholders, including Honda, to raise its stake to more than 97%. The automaker also plans to acquire the remaining shares.
GM said it expects to save approximately $1 billion annually once the deal closes, which is anticipated in the first half of 2025.
Cruise self-driving taxi in San Francisco
While Cruise was initially one of the more promising self-driving technology startups in the U.S.—with achievements including the launch of a commercial robotaxi service in San Francisco, where it is based—the company’s trajectory shifted dramatically last year following an incident in which one of its robotaxis dragged a female pedestrian in San Francisco who had already been involved in a separate hit-and-run accident with a nearby vehicle.
The Cruise robotaxi initially braked after making contact with the pedestrian but then continued for another 20 feet while attempting to pull over, a move Cruise claimed was intended to avoid further road safety issues. This post-crash maneuver, however, resulted in the robotaxi dragging the pedestrian. The detail wasn’t initially disclosed to investigators by Cruise and only came to light after regulators requested additional video footage from the company.
Following the incident, Cruise faced increased scrutiny from regulators and was fined $1.5 million by the NHTSA. The company subsequently ended its robotaxi service and reverted to testing prototypes with safety drivers on board.