General Motors (GM) has completed its acquisition of Cruise, the autonomous vehicle business, as part of a strategic pivot to developing autonomous technology for personal vehicles instead of robotaxis.
The auto giant plans to integrate Cruise's technology into its existing Super Cruise system, which enables hands-free driving across 750,000 miles of roads in North America. The Super Cruise feature is already available in over 20 GM vehicle models.
The complete merger of the two entities will lead to a substantial reduction in the workforce, with a spokesperson for Cruise confirming to Reuters that staff will be cut by 50%.
Sources familiar with the matter told the news agency that nearly 1,000 employees were laid off as part of the acquisition process.
GM senior vice president of software and services engineering Dave Richardson said: “By combining the specialised technology and talent at Cruise with our team developing Super Cruise, we’ll have the ability to accelerate our work on both assisted-driving and autonomous driving.
“We look forward to teaming with Cruise to accelerate our work together.”
This move comes after GM revealed in December that it would cease funding the Cruise robotaxi business.
GM’s decision to cease development of robotaxis was part of a broader internal cost-cutting programme, with the aim of cutting annual costs at its autonomous vehicle division from $2bn to $1bn by mid-2025.
GM cited the “considerable time and resources that would be needed to scale the business” and the pressures of an increasingly competitive market as the reasons.
Since 2016, GM has invested over $10bn in Cruise, with high hopes for its potential.
In 2023, CEO Mary Barra projected that Cruise could generate $50bn in annual revenue by 2030. However, the division’s financial challenges and the complexity of operating a robotaxi fleet ultimately made it unsustainable.
Soon after the announcement, Honda Motor Company decided pull out of robotaxi partnership GM.
The robotaxi industry remains highly competitive, with players such as Alphabet’s Waymo, Baidu, and Tesla continuing to invest heavily in autonomous technology.
However, the high costs and technological challenges associated with fully autonomous systems have prompted several automakers to reassess their strategies.
