A Cruise, which is a driverless robot taxi, is seen during operation in San Francisco, California, USA on July 24, 2023.
Anadolu Agency via Getty ImagesOn Tuesday, General Motors announced that it would invest an additional $850 million into Cruise, its beleaguered self-driving division. To date, the automotive giant has already invested and lost over $8 billion on Cruise with barely any revenue to speak of.
Paul Jacobson, GM’s chief financial officer, said during the Deutsche Bank Global Auto Industry Conference held in New York City that this new amount of funding would “buy us time” to conduct a “strategic review” on the division’s future.
Tiffany Testo, a company spokesperson, wrote in an emailed statement that Cruise “appreciates GM’s continued support.”
Cruise has faced an ongoing existential crisis since an October 2023 incident in San Francisco, where one of its autonomous cars dragged a woman 20 feet after she’d already been hit by a car. Since then, California regulators revoked its permits, and the company shut down its remaining fleet voluntarily. Cruise has not resumed operations in California.
In the aftermath, Mo Elshenawy, the company’s then-new president and chief technology officer, told employees that Cruise would be taking a much slower, more deliberate, and more cautious approach than the company had previously, according to a December email viewed by Forbes.
Phil Koopman, a professor at Carnegie Mellon University, and an expert on autonomous vehicles, told Forbes that GM’s decision to continue pouring money into Cruise was baffling. He noted that the parent company could be positioning itself to sell Cruise off, or GM could simply shut Cruise down.
“I don’t see a technical thing that has changed,” Koopman said of Cruise. “It’s going to be a really hard slog.”
Last month, Cruise restarted what it called “supervised driving.” Those passenger-less trips have a human safety driver behind the wheel and are underway in Phoenix, Arizona, and Dallas. On Tuesday, the company also announced that it would expand this testing phase to a third city: Houston.
Since Cruise halted all passenger services nationwide last year, its Google-owned competitor Waymo has remained the head-and-shoulders leader in autonomous driving. Waymo now conducts robotaxi operations in Phoenix, Los Angeles, San Francisco, and Austin, Texas.Still, Elshenawy remains bullish on Cruise’s future.
“In the not-too-distant future, autonomous vehicles will dramatically improve safety and efficiency in our transportation systems,” he wrote in a LinkedIn post on Tuesday. “I hope Houston is one of the places we can showcase those improvements.”
Meanwhile, Forbes reported last month that Cruise’s cofounder Kyle Vogt, who resigned from the company in November 2023, had already raised $150 million on a new robotics startup.
Since Vogt’s departure, Cruise has not named a new CEO, but it has two presidents, which include Elshenawy and Craig Glidden, a longtime GM attorney and executive.
