General Motors (NYSE:GM) says it will cease efforts to develop a fleet of autonomous robotaxis, shifting its focus to driver-assistance technology for privately owned vehicles.
Resource-intensive, competitive market
The choice to exit an increasingly competitive and resource-intensive market is a considerable pivot for the auto giant.
It shows the company has recalibrated its focus to concentrate on improving near-term driver assistance over the costly and uncertain full autonomy of the future.
The robotaxi initiative was spearheaded by Cruise, a majority-owned subsidiary of GM.
While Cruise had been a pioneer in self-driving technology, the company faced mounting challenges, including regulatory setbacks and escalating costs.
GM estimated that scaling a robotaxi business would require more than $10 billion in additional investment. By redirecting resources, the automaker expects to save $1 billion annually.
Many Cruise employees will be reassigned to GM's development of advanced driver-assist systems, such as Super Cruise.
This technology, available on more than 20 GM models, allows hands-free driving under specific conditions while requiring the driver to remain alert.
CEO Mary Barra said in a statement that the shift would align more closely with GM's core business and its “vision for the future of transportation”.
The competitive landscape for robotaxis also factored into GM’s decision. Rivals such as Waymo, backed by Alphabet (NASDAQ:GOOGL), and Tesla (NASDAQ:TSLA), with its ambitious driverless vehicle plans, have intensified the race to commercialise autonomous ride-hailing services.
Despite the ambition among its competitors, GM has determined that its resources are better deployed to enhance safety and convenience for individual drivers.
Driverless incident
Cruise was in the headlines following a high-profile accident in October 2023, in which one of its autonomous vehicles struck a pedestrian in San Francisco.
The incident led to a temporary suspension of Cruise's operations in California and nationwide, as well as a $500,000 settlement with federal authorities over inaccurate reporting of the accident.
While the decision to end the robotaxi program seems like a step back from GM’s earlier vision of fully autonomous vehicles, the company insists it remains committed to pushing ahead with autonomy.
The company’s revised strategy will focus on integrating self-driving innovations into its driver-assist features, to deliver benefits such as enhanced safety, reduced traffic congestion and lower driver stress.