Read more at source.
Read more at source.
The robotaxi project became too costly and difficult to justify to GM's shareholders, given the lack of clear path to profits. GM CEO Mary Barra stated that the time and expense required to scale a robotaxi business in a competitive market made it more efficient to combine forces with autonomous vehicle development for personal use.
This decision could potentially result in layoffs at Cruise, and testing in Arizona and Texas will pause. GM will need to repurchase its remaining shares of Cruise (it currently owns 90% of the company), and the next steps will be decided by Cruise's board, which may include restructuring, layoffs, or a shutdown.
The decision comes at a turbulent time for autonomous vehicles. Tesla plans to launch its own robotaxi service in 2025, while Alphabet's Waymo continues to explore new markets. However, other ventures such as Argo AI have faltered, with the latter shutting down in 2022 after Ford and Volkswagen pulled funding.
GM's decision to halt its robotaxi business follows years of significant investment, with approximately $10 billion poured into Cruise since its acquisition in 2016. The cost of running a robotaxi fleet, however, was deemed too high and not aligning with GM's core business.
Given the considerable time and expense required to scale a robotaxi business in an increasingly competitive market, combining forces would be more efficient and therefore consistent with our capital allocation priorities - GM CEO Mary Barra
