Things are getting worse at Cruise, General Motors’ troubled self-driving taxi division. After a series of mishaps in California, the ouster of its founder and CEO and the dismissal of nine executives, the robotaxi startup is also laying off 900 employees, or roughly 24% of its workforce, TechCrunch first reported on Thursday.
No one knows exactly how, when or if Cruise will bounce back after these incidents caused GM to slam the brakes on its robotaxi service. What is clear is that its primary rival, Alphabet’s Waymo, is chugging along just fine.
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Cruise Has Had A Rough Time This Year
Cruise, the self-driving subsidiary of General Motors, was making progress in creating a viable, profitable business around self-driving taxis. A bad crash has made it rethink things and allowed rival Waymo to pull ahead, and now GM is even reducing its spending on the division.
What garnered far fewer headlines is the fact that Waymo kicked off curbside drop-offs and pick-ups at Phoenix airport terminals today. Previously, the startup offered rides to and from airport train stations, but not all the way to the airport itself. That may not sound like groundbreaking news, but it still serves to underscore the vastly divergent paths of the two biggest names in autonomous driving in the U.S.
Earlier this year, both companies were offering driverless rides to actual paying customers. They operated in limited areas, but they had both made strides in solving one of the hardest—and potentially most lucrative—engineering challenges on the planet. Today the race to build a profitable business around self-driving cars is extremely lopsided in Waymo’s favor.
In the final stretch of 2023, Cruise has gone through executive shakeups, a full-on pause to its driverless taxi operations and, now, mass layoffs.
Waymo, meanwhile, keeps making progress. In the last few months, it’s introduced its driverless taxis to parts of Los Angeles for limited stints, expanded service to all of San Francisco, and added its cars to the Uber app in Phoenix. Waymo cars have been the subject of criticism, too, often for blocking traffic.
Scrutiny of Cruise intensified this year and came to a head after one of its vehicles hit and dragged a pedestrian who was initially struck by a human driver. In the aftermath, the California Department of Motor Vehicles revoked Cruise’s permit to test driverless cars. Its CEO and founder stepped down in November. In another sign of a bumpy road ahead, GM paused production of a custom-built taxi for Cruise called the Origin, Forbes first reported.
In an email to staff, Cruise CTO and President Mo ElShenawy said the layoffs were necessary as the company slows its roll on commercialization. The new priority will be safety and improved vehicle performance, he said, adding that engineering roles will be largely unaffected.
Getting to reliable, profitable autonomy has taken longer than carmakers and other big players in the self-driving car industry anticipated, leading to some high-profile exits from the business. Last year, Ford- and Volkswagen-backed Argo AI shut down. Uber, which had hoped to reap massive profits by taking the drivers out of its cars, abandoned its robotaxi project in 2020.
Cruise plans to relaunch its robotaxi service in a yet-to-be-named city. We’ll have to wait and see if it bounces back stronger and safer than before, or if Waymo runs away with it all.
Do you have any information about the layoffs at Cruise, or what’s going on at Waymo these days? Contact the author: [email protected].
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