GM is Spending a Lot of Cash so You Don't Have to Drive

Steph Willems
by Steph Willems
gm is spending a lot of cash so you don t have to drive

General Motors wants you to have more texting time in your car, and it’s dropping a lot of cash to see that it happens.

The company announced Friday that it will purchase San Francisco-based Cruise Automation in order to access and advance its self-driving vehicle technology, a buy worth upwards of $1 billion, Fortune reports.

The three-year-old startup has been busy gathering investor capital to develop and push aftermarket kits designed to turn regular vehicles into autonomous cars.

The dollar figure of the deal hasn’t been confirmed by GM, but it is known that Cruise will operate as an independent unit within GM’s Autonomous Vehicle Development Team, which has its own proving ground dedicated to self-driving technology. That team is lead by Gord Parks, and is also based in San Francisco.

“Cruise provides our company with a unique technology advantage that is unmatched in our industry,” said Mark Reuss, GM’s executive vice president of Global Product Development, Purchasing and Supply Chain, in a statement.

“We intend to invest significantly to further grow the talent base and capabilities already established by the Cruise team.”

Cruise Automation founder Kyle Vogh, now freed from the hassle of raising capital, called the purchase a “necessary step toward rapidly commercializing autonomous vehicle technology.”

The team at Cruise, working alongside the GM team, would give the automaker the talent boost it needs to compete with the self-driving technology being developed by Google and Apple. Beginning in 2014, GM has been working on a semi-autonomous system dubbed “Super Cruise” for use in the 2017 Cadillac CT6, but that system could soon resemble a hand-cranked starter once self-driving technology takes off.

Earlier this year, GM sank $500 million into the ride-sharing service Lyft in the hopes of partnering on an autonomous venture sometime in the future.

The only fully-autonomous vehicles on the road right now are involved in pilot projects in select locales, but work on the regulatory front is progressing.

In February, the National Highway Traffic Safety Administration admitted in response to a letter from Chris Urmson, director of Google’s Self-Driving Car Project, that the artificial intelligence controlling an autonomous car could officially be considered the driver of the car, and not the human occupant.

The self-driving system would only be considered the driver if the human occupant had no way of controlling the vehicle’s movements — in other words, if the vehicle had no pedals or steering wheel that could be manipulated by a human.

Despite lending more clarity to the disputed term “driver,” the letter said that certain exemptions would still be needed for autonomous vehicles to operate under existing regulations.

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3 of 21 comments
  • El scotto El scotto on Mar 12, 2016

    OK, so GM is buying into a ride-share company (Lyft)instead of owning part of a rental car company (Avis) and is also buying a high-tech self-driving automobile start-up (Cruise Automation) because they've done so well in the past with (EDS)high-tech electronics. Different place cards; the meal will still be disastrous.

  • on Mar 13, 2016

    A ridiculous waste of money. If you want to be driven, take public transportation. A cab when you need to. Lot cheaper than buying one of these silly cars.

    • Swester Swester on Mar 13, 2016

      Right, taking a cab or (non-existent) public transportation from your house in the suburbs is a much better option than having a self-driving car. /s

  • Inside Looking Out You should care. With GM will die America. All signs are there. How about the Arsenal of Democracy? Toyota?
  • DenverMike What else did anyone think, when GM was losing tens of billions a year, year after year?
  • Bill Wade GM says they're killing Android Auto and Apple Carplay. Any company that makes decisions like that is doomed to die.
  • Jeff S I don't believe gm will die but that it will continue to shrink in product and market share and it will probably be acquired by a foreign manufacturer. I doubt gm lacks funds as it did in 2008 and that they have more than enough cash at hand but gm will not expand as it did in the past and the emphasis is more on profitability and cutting costs to the bone. Making gm a more attractive takeover target and cut costs at the expense of more desirable and reliable products. At the time of Farago's article I was in favor of the Government bailout more to save jobs and suppliers but today I would not be in favor of the bailout. My opinions on gm have changed since 2008 and 2009 and now I really don't care if gm survives or not.
  • Kwik_Shift I was a GM fan boy until it ended in 2013 when I traded in my Avalanche to go over to Nissan.