GM to retreat from robotaxis and stop funding its Cruise autonomous vehicle unit
General Motors says it will retreat from the robotaxi business and stop funding its money-losing Cruise autonomous vehicle unit
DETROIT — General Motors said Tuesday it will retreat from the robotaxi business and stop funding its money-losing Cruise autonomous vehicle unit.
Instead the Detroit automaker will focus on development of partially automated driver-assist systems for personal vehicles like its Super Cruise, which allows drivers to take their hands off the steering wheel.
GM said it would get out of robotaxis “given the considerable time and resources that would be needed to scale the business, along with an increasingly competitive robotaxi market.”
The company said it will combine Cruise's technical team with its own to work on advanced systems to assist drivers.
GM bought control of San Francisco-based Cruise automation in 2016 with high hopes of developing a profitable fleet of robotaxis.
Over the years GM invested billions in the subsidiary and eventually bought 90% of the company from investors, all while racking up millions in losses.
GM’s brushoff of Cruise represents a dramatic about-face from years of full-blown support that left a huge financial dent in the automaker. The company invested $2.4 billion in Cruise only to sustain years of uninterrupted losses, with little in return. Since GM bought a controlling stake in Cruise for $581 million in 2016, the robotaxi service piled up more than $10 billion in operating losses while bringing in less than $500 million in revenue, according to GM shareholder reports filed with the Securities and Exchange Commission.
The automaker even announced plans for Cruise to generate $1 billion in annual revenue by 2025, but it scaled back spending on the company
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