Cruise’s service will likely cease to exist as GM pulls funding

The Costs of Developing a Super Cruise Robot Axion Fleet: An Analysis of Barra’s Confrontation with GM

GM expects $1 billion in cost savings annually when it finishes acquiring the rest of the shares.

It’s likely that GM’s move will result in layoffs at Cruise, though none are being announced right now. It is clear that Cruise’s testing in Arizona and Texas will be paused as the company decides on its next move. The next step for the company, which is owned by GM, will be the sale of the remaining shares, as well as the restructuring, layoffs, or simply shutting down.

General Motors said it would no longer fund its Cruise robotaxi service as it seeks to focus its spending on autonomous vehicle development specifically for personally owned vehicles. Now Cruise employees will be combined with GM’s internal teams working on advanced driver assist systems, like Super Cruise, as well as its project to develop autonomous vehicles to sell to customers for personal use.

Barra told analysts Tuesday that GM found that deploying and maintaining a robotaxi fleet is both too expensive and too far away from the manufacturer’s core business of building and selling cars.

It would be more efficient to combine forces given the time and money required to scale a businesses in an increasingly competitive market.

GM Plans to Reorientate the Super Cruise Technology into Autonomous Vehicles and Away-Hands-Free Autonomy

Cruise technology will now be used to refine the company’s Super Cruise tech, which is designed to perform some “hands-free” driving tasks—lane keeping, lane changing, and emergency braking—on specific highways. Super Cruise cannot be driven autonomously and drivers are warned to always stay alert.

Eventually, GM intends to sell “level 4” vehicles to car buyers, which can drive completely autonomously on some but not all roads. “We know people everywhere love to drive their own vehicles, but not in every situation,” Barra told analysts.

The company says it has an agreement with other shareholders to own more than 97 percent of the firm. GM will restructure and refocus Cruise as part of the effort, but could not say if it would lead to layoffs.