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The Very Slow Restart of G.M.’s Cruise Driverless Car Business

🌈 Abstract

The article discusses the challenges faced by Cruise, General Motors' driverless car subsidiary, after a serious incident involving one of its autonomous vehicles in San Francisco. It explores Cruise's efforts to rebuild its reputation and regain regulatory approval, as well as the company's cautious approach to resuming operations.

🙋 Q&A

[01] Cruise's Challenges and Rebuilding Efforts

1. What led Cruise to take all of its cars off the road?

  • A serious incident in San Francisco where a Cruise driverless car hit and dragged a pedestrian, causing severe injuries.

2. What steps has Cruise taken to rebuild its reputation?

  • Cruise has slowed down its development to avoid another major mishap, focusing on safety as its "North Star".
  • The company has made leadership changes, including the departure of its CEO and the layoff of a quarter of its workforce.
  • Cruise has hired a veteran product safety executive as its new chief safety officer, and the three current executives make unanimous decisions on safety matters.

3. How is Cruise's cautious approach impacting its competitiveness compared to rivals like Waymo and Zoox?

  • Catching up with Waymo technologically is expected to take 3-5 years at best, and Waymo has already been generating revenue with trust that Cruise never earned.
  • Cruise risks falling far behind its top rivals as it takes a slower, more cautious approach to resuming operations.

[02] Regulatory Challenges and Cruise's Future

1. What is the status of Cruise's regulatory approval in California?

  • It is unclear if or when Cruise could regain a permit to operate in California, as the company is still answering questions from state regulators about driverless testing.

2. How are regulators and local officials responding to Cruise's efforts to rebuild trust?

  • There is still tension and distrust towards the autonomous vehicle industry's aggressive testing on public roads in the past.
  • Cruise needs to demonstrate "profound transparency" to show that an incident like the one on October 2nd will not happen again in order to win over regulators.

3. What is the outlook for Cruise's future within General Motors?

  • After initially considering shutting down Cruise, GM has reiterated its commitment to the company, although it is exploring different options to fund the business, including taking outside investments.
  • Cruise lost $3.48 billion in 2023 and another $519 million in the first three months of 2024, leading GM to slash $1 billion from Cruise's 2024 budget.
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