Cruise’s robotaxi service will shut down as GM pulls its funding

General Motors stated it could now not fund its Cruise robotaxi service because it seeks to focus autonomous car improvement on personally owned automobiles.

GM stated Cruise staff can be mixed with its inside groups engaged on superior driver help techniques, in addition to its challenge to develop personally owned autonomous automobiles.

“Consistent with GM’s capital allocation priorities, GM will now not fund Cruise’s robotaxi improvement work given the appreciable time and assets that might be wanted to scale the enterprise, together with an more and more aggressive robotaxi market,” the automaker stated in a press release revealed Tuesday.

It’s doubtless that GM’s transfer will lead to layoffs at Cruise, although none are being introduced proper now. What is obvious is that Cruise’s testing in Arizona and Texas will pause as the corporate decides its subsequent transfer. GM will want repurchase its remaining shares of Cruise (the automaker owns 90 % of the corporate) after which Cruise’s board will decide subsequent steps, which incorporates restructuring, layoffs, or just shutting down.

The shutdown of Cruise’s robotaxi service comes amid a turbulent time for autonomous automobiles. While Alphabet’s Waymo continues to eye new markets, different ventures have faltered. The most notable was Argo AI, which shutdown in 2022 after Ford and Volkswagen pulled funding.