General Motors has announced that it will no longer fund the development of its Cruise division’s robotaxi service, citing increasing competition, capital allocation priorities, and the significant time and resources required to grow the business.that in a major strategic shift, GM has decided to abandon its Cruise driverless ride-hailing service and fold the division into its broader tech team.
The increasingly competitive robotaxi market, capital allocation priorities, and the considerable time and resources necessary to grow the business were cited as the main reasons behind GM’s decision. The majority-owned Cruise LLC will be combined with GM’s technical teams, though the exact number of employees transitioning to GM has yet to be determined. Cruise currently employs nearly 2,300 people.
The decision to exit the robotaxi market comes as Cruise’s operations have faced challenges in recent years. In October 2023, the company grounded its driverless operations shortly before founder Kyle Vogt’s departure. The National Highway Traffic Safety Administration also fined Cruise $1.5 million for failing to disclose details of a serious crash involving a pedestrian that same month.