GM Halves Spending on its Cruise Robotaxi Unit
In a conference call with investors, analysts and the press today, General Motors CEO Mary Barra also spoke about the future of the robotaxi unit Cruise. Following a crash, Cruise had to temporarily cease all activities and was subject to a change in management on the one hand and a restructuring on the other, which saw twenty percent of the workforce fall victim.
Barra announced further spending cuts. Following expenditure of 1.9 billion dollars and a pre-tax loss of 2.7 billion dollars, GM intends to cut expenditure by one billion dollars. Since the acquisition of Cruise, GM has spent eight billion dollars on the Robotaxi unit.
With the management change, GM installed GM veteran Craig Glidden at the helm as Chief Administrative Officer. Mo Elshenawy, new Cruise president, who has been with Cruise since 2019, took on the thankless task of rebuilding employee morale, which is in the gutters.
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GM wants to keep engineers and other top talent at the company, which is likely to be quite a challenge given an unclear timeline for restarting operations and the noticeable culture change from a Silicon Valley startup to one run by Detroit GM veterans (with all the good and bad parts). AI talent and engineers are highly sought after in the San Francisco Bay Area and can expect high salaries as well as the ability to develop their technology quickly. This is likely to be a problem for GM and a brain drain seems to be taking place.
In the meantime, the Chevrolet Bolt-based Cruise robotaxis have been withdrawn from all cities and are to be deployed with new software and possibly updated sensors when the company restarts later this year. The restart is to take place in close cooperation with the authorities, the affected region and the local population. Rumor has it that the first city to be affected will be Texas.
It is unclear what will happen with the new vehicle type, the Cruise Origin, dozens of which are said to have already been built. The spending cuts could indicate that this type of vehicle will be discontinued, as the construction of these vehicles was dependent on a GM credit line. I certainly hope we don’t see a déjà vu, as we did with the legendary first GM electric car, the EV 1.
It has become clear to Cruise and GM that they cannot compete with Waymo in this form. In the meantime, the Google sister company is slowly expanding its commercial robotaxi service into other cities and regions, as the latest applications to the CPUC have shown.
Here’s another excerpt from the conference call with Marry Barra:
Moving to Cruise. Last week, we released the results of the third-party reviews, and we’ve already begun to implement significant changes to build a better Cruise. We are committed to earning back the trust with our regulators and the public through our actions.
Our planned 2024 investment in Cruise reflects our more deliberate and cadence go-to-market strategy, and we are developing new financial targets and a new road map. Spending will be down considerably this year, but we will continue to invest in the people who are advancing the software, specialized hardware, and AI capabilities. This reflects our commitment to our vision, which is to deliver the safety benefits of self-driving technology and a scalable, profitable business. I look forward to sharing our timetable for returning Cruise AVs to the road soon. [..]
Because of the significant changes that are underway at GM and Cruise, we think it makes sense to wait until later in the year to host an event. This will give our software team the time to focus on software for our upcoming launches, and we will be able to share more tangible proof points on all four pillars — pillars of our strategy: ICE, EV, AV, and software. When we do get together, we will show you what we’ve not done, not just tell you what we’re going to do. In the meantime, we’ve already provided a road map for EV profitability in 2025, and we’ll share updates on Cruise as we finalize the technology and relaunch plan
KREATIVE INTELLIGENZ
Über ChatGPT hat man viel gelesen in der letzten Zeit: die künstliche Intelligenz, die ganze Bücher schreiben kann und der bereits jetzt unterstellt wird, Legionen von Autoren, Textern und Übersetzern arbeitslos zu machen. Und ChatGPT ist nicht allein, die KI-Familie wächst beständig. So malt DALL-E Bilder, Face Generator simuliert Gesichter und MusicLM komponiert Musik. Was erleben wir da? Das Ende der Zivilisation oder den Beginn von etwas völlig Neuem? Zukunftsforscher Dr. Mario Herger ordnet die neuesten Entwicklungen aus dem Silicon Valley ein und zeigt auf, welche teils bahnbrechenden Veränderungen unmittelbar vor der Tür stehen.
This article was also published in German.
