GM’s self-driving car company Cruise lost $3.48 billion in 2023
source link: https://www.washingtonpost.com/technology/2024/01/31/cruise-self-driving-company-loss-gm/
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GM’s self-driving car company Cruise lost $3.48 billion in 2023
General Motors, which owns Cruise, said it will reduce the company’s expenses by about $1 billion to “slow the cash burn"
SAN FRANCISCO — General Motors-owned self-driving car company Cruise’s operating loss totaled $3.48 billion in 2023, a staggering deficit that comes as the company faces two federal probes over an October crash in San Francisco and uncertainty over when it will resume its driverless testing program around the country.
Cruise, once regarded as a front-runner in the autonomous car industry, has been bleeding money since General Motorsacquired it in 2016. While General Motors said Tuesday that it “remains committed” to Cruise, the automotive giant also said it will reduce Cruise’s expenses by about $1 billion to “slow the cash burn and align with a narrower focus in 2024.”
Cruise, which lost $3.2 billion in 2022, according to financial statements, halted its driverless testing program around the country after a crash in the fall in which one of its cars hit and dragged a pedestrian about 20 feet at 7 mph.
“At Cruise, we are committed to earning back the trust of regulators and the public through our commitments and our actions,” General Motors CEO Mary Barra said in a Tuesday call with investors. Barra added that GM plans to “refocus and relaunch” the embattled self-driving car company this year and that the company plans to cooperate with two ongoing federal investigations by the Department of Justice and Securities and Exchange Commission that were disclosed last week.
General Motors had a strong 2023 overall, with a revenue of $171.8 billion. Still, the autonomous-car company’s financial woes come as investors pour billions of dollars into the wider self-driving car industry, with hopes that robot-driven cars will usher in a future with fewer road injuries and fatalities. But even as the technology rapidly improves, the sector has been beset by recalls, financial issues and accidents that often gain far more attention than if they involved human drivers.
Google, which owns Waymo — Cruise’s main competitor — doesn’t disclose how much money the self-driving car unit burns each year, but it’s probably in the billions as well. The company’s “other bets” division, of which Waymo is one of the main expenses, lost $4.1 billion in 2023, according to the company’s financial statements.
Both Cruise and Waymo hit a major milestone this summer when California regulators allowed the companies to offer 24/7 robotaxi service in San Francisco. But the California Department of Motor Vehicles suspended Cruise’s permits just a few months later, after the Oct. 2 crash in which a human-driven car hit a jaywalking pedestrian and flung her in the path of a Cruise driverless car.
In footage initially shared by Cruise with The Washington Post, other media outlets and the California Department of Motor Vehicles, the robot car appeared to stop as soon as it made contact with the pedestrian.But it has since been revealed — by state regulators and in a more than 100-page third-party report dissecting the crash — that the car continued to drag the woman.
According to the report, a human driver would probably “not have been able to avoid the collision under similar circumstances.” But, the report said, an “alert and attentive human driver would be aware that an impact of some sort had occurred and would not have continued driving without further investigating the situation.”
Cruise, which did not respond to a request for comment Wednesday, has had a tumultuous few months since the crash, including layoffs and the resignation of its CEO late last year.
Gerrit De Vynck contributed to this report.
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