GM representatives referred Automotive News to public comments about Cruise from CEO Mary Barra and other executives, who have expressed optimism about the company’s prospects.
At last month’s South by Southwest event in Austin, Barra said Cruise and AVs more broadly represent the automaker’s goal of zero emissions, congestion and crashes.
Last year, GM acquired SoftBank Vision Fund 1’s ownership position in Cruise for $2.1 billion and made a separate investment of $1.35 billion into Cruise that SoftBank previously had committed, according to an annual report filed with the U.S. Securities and Exchange Commission. In the filing, GM said it made “additional investments in Cruise of $1.1 billion” in 2022.
The investments brought GM’s ownership stake up to about 80 percent. Honda Motor Co. has been a minority owner since 2018 and worked with GM to develop the Origin.
“The growth opportunity with Cruise is just phenomenal,” Barra said at South by Southwest.
GM can build as many Origin vehicles as Cruise needs, she said, while the company’s technology, combined with Vogt’s road maps on how to reduce costs with scale, could open up a larger ride-hailing market than exists today.
“We’re here. It’s happening now,” Barra said. “We’re charging for rides. Now’s not the time to take the foot off the accelerator.”
One key step forward will be getting the Origin into operation, Vogt said. The vehicle is designed for robotaxi use and to last for hundreds of thousands of miles, he said, lowering Cruise’s costs and making it difficult for competitors to match by retrofitting vehicles.
Cruise continues to work with regulators on its request for an exemption from Federal Motor Vehicle Safety Standards to deploy the Origin for commercial service, Vogt said.
The automaker hasn’t said whether Cruise’s technology eventually will show up in GM’s passenger vehicles. But Cruise’s work, coupled with GM’s work on advanced driving technologies, could create the economies of scale necessary to offer autonomous technology for personal transportation, Barra said at the 2022 CES technology expo.
“In pursuing multiple paths simultaneously, GM and Cruise are gaining significant technological expertise and experience, and we are working to be the fastest to market with a retail personal autonomous vehicle,” she said. “In fact, we aim to deliver our first personal autonomous vehicles as soon as the middle of this decade.”
The opportunities Cruise’s robotaxi service and even consumer AVs offer could change the thinking about automotive revenue as a function of pricing and annualized sales rates to one of the revenue a vehicle can generate over its lifetime, said Itay Michaeli, a Citi research analyst who covers GM.
“You can start to take potentially a much larger share of that lifetime revenue as you’re creating new business models on a machine that over time will have declining cost per mile,” Michaeli said.
