General Motors has announced that it will no longer provide funding for the development of Cruise’s self-driving taxis, considering the significant time and resources required to scale up the business and the increasingly competitive market for self-driving taxis. It is reported that GM has invested over $10 billion in Cruise.

According to General Motors’ statement, Cruise will be integrated into General Motors’ driving assistance technology business division, focusing on developing advanced driving assistance systems for General Motors’ future vehicle sales. General Motors expects that the restructuring plan will be completed by the end of June next year, after which the company will reduce its expenses by more than $1 billion annually.

General Motors owns approximately 90% of Cruise’s shares and has already reached an agreement with other shareholders to increase its stake in Cruise to more than 97%. At the same time, General Motors will seek to acquire the remaining shares of Cruise.

On December 11, Mary Barra said, “This is the latest in a series of decisions we’ve announced for GM, and it underscores our commitment to the right technology for the future of our company and the industry, and our commitment to executing quickly and efficiently.” However, Mary Barra declined to reveal how many Cruise employees would be transferred to GM.

After the above report was released, General Motors’ stock rose by 3.2% in after-hours trading.

Last month, Cruise admitted submitting false reports, thereby affecting the US Federal Investigation, and agreed to pay $500,000 in criminal fines as part of a deferred prosecution agreement. The US Department of Justice stated that Cruise failed to disclose key details of a crash that occurred in October last year, when one of the company’s self-driving taxis in San Francisco collided with a pedestrian and caused serious injuries.

In July this year, General Motors announced that it would stop developing an autonomous taxi without a steering wheel or other manual controls. In 2022, General Motors submitted an application to the US National Highway Traffic Safety Administration (NHTSA) requesting permission to deploy up to 2,500 Origin autonomous vehicles per year without human control devices such as brake pedals or mirrors. However, NHTSA has taken no action on this request. General Motors claims that NHTSA’s decision is due to regulatory risks.

Due to the difficulties and high costs of developing autonomous taxi technology, some of General Motors’ competitors have also stopped funding their autonomous business. In October 2022, Ford stopped investing in Argo AI, and then Argo AI went bankrupt. Ford is still developing advanced driver assistance systems internally, but this is different from the fully autonomous driving system developed by Argo AI.