Detroit — General Motors CEO and Chair Mary Barra has long been promising a new direction for the company, moving away from a traditional automaker to a tech-focused, forward-thinking entity ready for expansion. GM’s innovation division aimed to uncover vast market opportunities, including electric commercial vehicles, auto insurance, military defense, autonomous vehicles, and the potential for urban air mobility, also known as “flying cars.”
During a virtual CES keynote in January 2022, Barra emphasized the creation of cutting-edge technology solutions and services that will revolutionize transportation, introducing new fleet solutions and business models. Despite not disclosing the revenue from these ventures, GM’s recent decision to end its Cruise robotaxi operations signifies a shift in growth priorities towards core operations and adjacent opportunities like software, electric vehicles, and personal autonomous vehicles.
The Cruise robotaxi service, once seen as a significant growth opportunity for GM, is now being discontinued after over $10 billion in investments since its acquisition in 2016. The decision reflects the competitive nature of the robotaxi market, capital allocation priorities, and the challenges in scaling the business. GM’s move has been positively received by analysts, with the company expected to save over $1 billion in capital annually.
While GM remains committed to vehicle autonomy, it will now focus on personal autonomous vehicles rather than robotaxis. The cancellation of the Cruise robotaxi business is part of a broader trend where GM’s mobility ventures and growth initiatives have not met expectations, with previous ventures like BrightDrop EV commercial vans being integrated into Chevrolet due to underwhelming sales.
Despite setbacks in certain areas, GM continues to operate successful noncore businesses such as GM Energy, BrightDrop commercial EVs, and its insurance business launched in 2020. The company also maintains a military defense unit and a fuel cell business with recent contract wins. GM’s decision to prioritize the development of its Super Cruise hands-free system over robotaxis underscores its commitment to advancing autonomous vehicle technology for personal use.
The cancellation of the Cruise robotaxi business signals GM’s strategic shift towards focusing on core operations and profitable growth avenues. The move reflects the challenges of scaling a robotaxi network and the evolving landscape of autonomous vehicle commercialization. While GM’s decision may have disappointed some, it underscores the company’s commitment to innovation and adapting to market dynamics in the automotive industry.
