Last week, Cruise disclosed probes by the U.S. Justice
Department and the Securities and Exchange Commission stemming from an Oct. 2
accident in San Francisco in which one of its robotaxis struck a pedestrian and
dragged her 20 feet (6.1 m). Cruise and GM came under heavy criticism after the
accident, and the California Department of Motor Vehicles revoked its permit to
operate driverless vehicles.
GM CEO Mary Barra said on Tuesday the No. 1 U.S. automaker
will "refocus and relaunch Cruise," and said the company would
"soon" disclose a timetable for resuming operations.
Cruise burned $1.9 billion in cash during 2023, and recorded
a $2.7 billion pretax loss, not including $500 million in restructuring costs
incurred in the fourth quarter as the unit cut staff, GM said.
"We are committed to Cruise," Barra said.
She said the company will cooperate with the government
investigations. In a call with analysts, Barra said Cruise will set a higher
bar for its robot driver than matching the safety of human drivers. GM has
learned that "humans expect computers to be much more safe" than
human operators, she said.
Barra said Cruise's spending this year will be focused on
retaining software and engineering talent. With the previous plans to expand
Cruise's robotaxi operations to 20 cities now on hold, GM does not need to
spend on vehicles and operations personnel, she said.
A technical review by engineering firm Exponent commissioned
by GM and released last week found the Cruise vehicle suffered from mapping
errors and incorrectly identified hitting the woman as a side impact collision,
the report stated. Cruise has since recalled the vehicles and updated its
software.
Cruise earlier this month offered to pay $75,000 and make
new disclosures to resolve an investigation by the California Public Utilities
Commission into its failure to disclose details of the Oct. 2 accident.
Cruise on Tuesday asked the commission to accept its
settlement proposal, saying "the reckoning for Cruise in the aftermath of
the Oct. 2 accident has been swift and extensive." It called the $75,000
offer "a reasonable sum given the conduct at issue, Cruise’s remedial
actions, and the totality of the circumstances."
Since the accident, Cruise has fired nine executives. CEO
Kyle Vogt and company co-founder Dan Kan both resigned, and Cruise cut a
quarter of its staff.
The new probes and disclosures about Cruise's mishandling of
the accident intensify pressure on GM and Barra, who has defended the
automaker's investment in the robotaxi operation despite more than $8 billion
in losses. She had previously said the business could generate $50 billion in
annual revenue by 2030.
Cruise once operated hundreds of unmanned robotaxis in
California, Texas and elsewhere, hoping to generate revenue while perfecting
the technology.
Reuters
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