Financial Markets


Dark Clouds loom over the Future of Autonomous Vehicles as Leadership Crisis Hits GM’s Cruise

General Motors’ autonomous vehicle subsidiary, Cruise, is steering through tumultuous waters, throwing a dark shadow over the auto industry’s future. Kyle Vogt, the CEO of Cruise has resigned, and there are indications of a potential exit by co-founder and Chief Product Officer, Dan Kan. This management fiasco, coupled with a dreadful incident where a pedestrian suffered unusually in a hit-and-run involving a Cruise vehicle, has cast a wave of uncertainty over GM's ambitious vision of a future of "zero crashes, zero traffic, and zero emissions".

The growing list of setbacks has also fueled apprehension about job security in an industry segment that once projected boundless innovation and unbridled potential. The unknotting crisis has led to a nationwide freeze of GM's autonomous driving operations, an unforeseen safety audit by a third-party organization, and the recall of all 950 of its driverless vehicles.

This latest incident led to the California Department of Motor Vehicles suspending Cruise's permit to operate autonomous vehicles - a significant blow that raises questions on the viability and safety of driverless cars, following which, GM CEO, Mary Barra, reportedly appointed GM’s general counsel Craig Glidden alongside Mo Elshenawy as co-presidents of Cruise.

In what might be seen as a ripple effect in the industry, other automakers have also cautiously reconsidered their aggressive push for autonomous vehicles. Ford and Volkswagen have significantly cut back their funding in the self-driving car startup, Argo AI. Similarly, the ambitious project of Toyota's driverless car technology has experienced a setback, marking a slowdown.

Questions are also swirling around the future of BrightDrop – GM’s electric vehicle delivery subsidiary. The company spun off from GM nearly two years ago, only to be recently re-absorbed, fueling speculation about the automaker's strategic objectives and aspirations in the autonomous and electric vehicle industry.

Speculations also point towards potential layoffs. Cruise has already let go of a significant number of contract workers who were involved in maintenance and fleet operations. However, there remains a deep haziness around the timing and the cause of these looming job cuts.

The current tumultuous state of affairs at Cruise and the broader autonomous vehicle industry brings into the spotlight, the critical challenges tied to the advancement in autonomous vehicle technology. Not only does it raise questions about safety and efficacy, but it also underlines the need for legislative scrutiny and regulatory vigilance. Indeed, the ongoing crisis at Cruise signals a crucial test for the future of self-driving vehicles. The industry, seen as the vanguard of the next industrial revolution, is experiencing what could be considered its most significant turning point, one that could define whether autonomous vehicles are indeed our future, or if they are just a wonderful but unreachable dream. The road ahead remains uncertain, with many stumbling blocks yet to be navigated.